CAMBRIDGE MASSACHUSETTS BUILDING EXPERT
DIRECTORY AND CAPABILITIES

The Risk of A Fixed Price Contract Is The Market

August 03, 2022 — David Adelstein - Florida Construction Legal Updates
When performing work on a fixed price or unit, there is risk that is being assumed on your end. One risk is the market. You are ultimately banking on the fact that the market is not going to make your fixed prices unprofitable. That’s not an unforeseeable occurrence because the market shifts and that shift can have a negative ripple effect. In a recent case out of the Federal Circuit, U.S. Aeroteam, Inc. v. U.S., 2022 WL 243176 (Fed.Cir. 2022), this market risk played a role in a fixed price contract. Here, a contractor was hired by the federal government to produce ground support trailers. A key component of these trailers was a running gear. The contractor relied on a vendor for these running gears. Due to financial difficulties, the vendor had to raise its unit price for the running gears. Based on the increased price, the contractor elected to manufacture the running gears itself. The contractor asked the government if this was ok and the government approved the request. Once the contractor started manufacturing these running gears, it had an “awe” moment – the manufacturing costs were higher than anticipated. The contractor submitted a request for equitable adjustment which the government denied. The Contractor than sued the government raising three arguments to support its entitlement to additional costs: (1) constructive change; (2) cardinal change; and (3) commercial impracticability. The contractor lost on all arguments. It probably should have lost on all arguments. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Hilti Partners with Canvas, a Construction Robotics Company

April 03, 2023 — Aarni Heiskanen - AEC Business
Hilti announced a strategic partnership with Canvas, a construction robotics company that has developed a robotic drywalling solution. The partnership allows Canvas to scale globally. Hilti launched its Jaibot, the world’s first semi-autonomous ceiling-drilling robot, in 2020. As part of the partnership, Hilti will assume the manufacturing responsibilities for future Canvas systems. They will be based on the Jaibot platform, giving Canvas a reliable and scalable global supply to meet the huge demand for its finishing robots. The partnering companies share a common vision: that robotic tools will unlock vastly untapped potential and drive a new era of productivity and safety for skilled trade workers. Read the court decision
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Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aec-business@aepartners.fi

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Defending Against the Res Ipsa Loquitur Doctrine – Liability Considerations

February 14, 2022 — Rina Clemens - Traub Lieberman Insurance Law Blog
A doctrine of limited applicability, res ipsa loquitur, stands for the proposition that the “things speaks for itself.” This doctrine allows a plaintiff to shift their evidentiary burden of proof to the defendant where a court can infer negligence from the fundamental nature of an accident or injury. We’re noticing a dangerous trend of more plaintiffs seeking to apply this doctrine in liability cases and clients need to know how to defend themselves. When faced with a person claiming that they sustained injuries while on your property, ask yourself: did your business have exclusive control of the instrumentality plaintiff alleges caused their injury? Would the accident have occurred without the negligence of the one in control of the instrumentality? Reprinted courtesy of Rina Clemens, Traub Lieberman Ms. Clemens may be contacted at rclemens@tlsslaw.com Read the full story... Read the court decision
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Illinois Court Addresses Coverage Owed For Subcontractor’s Defective Work

May 06, 2019 — Brian Bassett - TLSS Insurance Law Blog
In Acuity Ins. Co. v. 950 W. Huron Condo. Assoc’n, 2019 IL App (1st) 180743, the Illinois Court of Appeals held that a claim against a subcontractor for damage caused to property outside the scope of its work satisfied the insuring agreement of a CGL policy. The condominium association for the building located at 950 West Huron Street in Chicago, Illinois (“the Association”), sued its general contractor and construction manager Belgravia Group, Ltd., and Belgravia Construction Corporation (collectively “Belgravia”). The Association sought to recover for alleged defects from Belgravia’s unworkmanlike construction of the building that permitted water to permeate and cause damage. In the Association’s complaint, it alleged that in June 2002, after the Association took possession of the building but prior to the completion of construction, Belgravia became aware of numerous conditions and defects, including extensive water infiltration of the building. After discussing the issues with Belgravia, the Association claimed that Belgravia retained contractors to provide cosmetic fixes. However, this did not address the problems and defects. The Association alleged that it spent a substantial amount of money to identify and correct the damage and that it would incur additional costs for future repairs. Read the court decision
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Reprinted courtesy of Brian Bassett, Traub Lieberman
Mr. Bassett may be contacted at bbassett@tlsslaw.com

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Don’t Put Yourself In The Position Of Defending Against An Accord And Satisfaction Defense

October 10, 2022 — David Adelstein - Florida Construction Legal Updates
The doctrine of accord and satisfaction lives and breathes in disputes including construction disputes. Unfortunately, a contractor, in the case discussed below, found out the hard way after it cashed checks that were accompanied with a letter that clearly indicated the checks were final payment. Once those payments were cashed, there was no “buyer’s remorse” that would allow it to still pursue disputed amounts. Remember this the next time you accept and cash a payment that says on the check it is full and final payment OR is accompanied by a letter that makes clear the payment is full and final payment. If you cash it, there is no second bite out of the apple, so to speak. If you are not interested in the payment being full and final payment, return the check. If you are not sure, either return the check or inquire and get that response in writing. Don’t put yourself in the position of defending against an accord and satisfaction defense. Even without the doctrine of accord and satisfaction, the contract between the contractor and owner discussed below made clear that contractor’s acceptance of final payment meant that contractor was unconditionally waiving other claims against the owner, further reinforcing that there would be no second bite out of the apple. The morale:

(1) read the letter that accompanies a check and do NOT cash a check that indicates it is for final payment unless you are prepared to accept that amount; and (2) read your contract to understand any contractual obligation that kicks-in with the acceptance of final payment.

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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Georgia Supreme Court Rules Construction Defects Can Constitute an Occurrence in CGL Policies

April 05, 2011 — Beverley BevenFlorez CDJ STAFF

Recently, the Supreme Court of Georgia reversed the decision in American Empire Surplus Lines Insurance Company v Hathaway Development Company, Inc. stating that because Whisnant’s faulty workmanship caused damage to the surrounding properties, the construction defects constituted “occurrences” under the Commercial General Liability (CGL) policy. Unlike the South Carolina Supreme court ruling in the case of Crossman Communities v Harleysville Mutual, the Georgia Supreme Court stated that an accident can happen intentionally if the effect is not the intended result.



Interestingly, the only dissenting judge, J. Melton, disagreed with his colleagues on the basis that “although the term ‘accident’ is not specifically defined in the policy, it is axiomatic that an ‘accident’ cannot result from ‘intentional’ behavior.” It is clear that what constitutes an occurrence in CGL policies is still being hotly debated.



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Brad Pitt’s Foundation Sues New Orleans Architect for Construction Defects

September 25, 2018 — David Suggs – Bert L. Howe & Associates, Inc.
Brad Pitt’s foundation has sued its architect of New Orleans projects alleging “defective design work led to leaks and other flaws in homes built for residents of an area that was among the hardest hit by Hurricane Katrina,” reported Insurance Journal. The Make It Right Foundation claims damages of more than $15 million caused by architect John C. Williams. According to Insurance Journal, “The foundation paid Williams’ firm millions of dollars to produce architectural drawings for more than 100 homes under the program, which was supposed to provide Lower 9th Ward residents with sustainable and affordable new homes.” This lawsuit against the architect is apparently in response to a class-action lawsuit by New Orleans attorney Ron Austin against Pitt’s Make It Right Foundation. Austin’s lawsuit “accused the charity of building substandard homes that are deteriorating at a rapid pace,” Insurance Journal reported. The 39 homes involved in a previous suit regarding the manufacturer of TimberSIL are excluded from the lawsuit against Williams. Read the court decision
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Getting U.S to Zero Carbon Will Take a $2.5 Trillion Investment by 2030

December 29, 2020 — Will Wade & Eric Roston - Bloomberg
It’s going to take $2.5 trillion in spending over the next decade to get the U.S. on a path to a carbon-free economy, but the transition will help to pay for itself, Princeton University researchers say. Achieving net-zero emissions by 2050 -- a central goal of President-elect Joe Biden’s climate plan -- would require expanding renewable-energy systems, building more efficient homes and putting 50 million electric cars on the road, according to a report released Tuesday. The effort, two years in the making, is the first major assessment since the election detailing how the U.S. can transition to an energy system that satisfies scientific guidance for keeping the climate livable. While the upfront costs are significant, they would be offset by savings associated with switching to cheaper electricity and the creation of as many as 1 million new jobs, according to the researchers, who shared an earlier draft with Biden’s transition team. Read the court decision
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Reprinted courtesy of Will Wade & Eric Roston, Bloomberg

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