Fairfield Connecticut Building Expert Directory

Contractual “Pay if Paid” and “Pay when Paid” Clauses? What is a California Construction Subcontractor to Do?

November 29, 2021 — William L. Porter - Porter Law Group
The Situation California Construction Subcontractors Face in Obtaining Payment: California construction subcontractors find themselves faced with a significant payment issue every time they are asked to sign a subcontract on a major project. Invariably, the subcontract the prime contractor presents to the subcontractor for signature will contain a clause by which the prime contractor imposes a condition on payment from the prime contractor to the subcontractor. The condition will be either one or the other of two general types. Either the prime contractor will specify that it never has to pay the subcontractor if the prime contractor itself is not paid by the owner (a “pay-if-paid” clause), or the prime contractor will pay the subcontractor only after the prime contractor has first exhausted all its efforts to obtain payment from the owner through litigation, arbitration or otherwise, possibly delaying payment to subcontractors by months or even years (a “pay-when-paid” clause). Goal of the Article: The goal of this article is to draw a distinction between the pay-if-paid and pay-when-paid clauses, discuss the legality of these clauses in California, the problems these clauses create for subcontractors, advise the reader of helpful recent legal developments in this area of law, address the possibility of a further legislative remedy to address the issue, and discuss what the subcontractor might do to protect itself while awaiting a legislative remedy that may or may not ever arrive. Read the court decision
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Reprinted courtesy of William L. Porter, Porter Law Group
Mr. Porter may be contacted at bporter@porterlaw.com

Cal/OSHA Approves COVID-19 Emergency Temporary Standards; Executive Order Makes Them Effective Immediately

July 11, 2021 — Leila S. Narvid - Payne & Fears LLP
On June 17, 2021, California's Occupational Safety and Health Standards Board (Standards Board) passed amended COVID-19 Emergency Temporary Standards (ETS). Gov. Gavin Newsom issued an Executive Order to make the amended ETS effective as soon as filed with the Secretary of State. The Office of Administrative Law (OAL) filed them, and the Secretary of State posted them, making the ETS effective immediately. These changes attempt to bring the ETS in alignment with recent changes to California Department of Public Health Order and the latest guidance from the Center for Disease Control (CDC). Highlights of the changes to the ETS can be found here. Face Coverings in the Workplace; Elimination of Physical Distancing Notably, fully vaccinated employees do not have to wear a face covering indoors except in limited circumstances. Unvaccinated workers will still need to wear face coverings indoors (unless they are alone in a room or eating and drinking) and in shared vehicles. All employees regardless of vaccination status do not have to wear masks outdoors. Unvaccinated employees must be trained that face coverings are recommended outdoors for individuals who are not fully vaccinated when six feet of physical distance cannot be maintained. Read the court decision
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Reprinted courtesy of Leila S. Narvid, Payne & Fears LLP
Ms. Narvid may be contacted at ln@paynefears.com

How AI Can Become a Design Adviser

October 02, 2018 — Aarni Heiskanen - AEC Business
Parametrized design software is not a recent invention. This software is based on predetermined, fixed algorithms, leaving most of the work to the designer. Sweco, a leading engineering consultancy, is now exploring how artificial intelligence (AI) could take design automation in the Architecture, Engineering, and Construction industry to the next level. 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

Hundreds of Snakes Discovered in Santa Ana Home

February 04, 2014 — Beverley BevenFlorez-CDJ STAFF
404 Snakes—more than half dead—were discovered after a “nearly daylong search” in a home in Santa Ana, California, reported the Los Angeles Times. “Over the past few months, neighbors called authorities about the foul odor,” claimed the Orange County Register. “They thought it was trash. Then Jehovah’s Witnesses knocked on the door.” Concerned that someone might have died, they called the police. William Buchman, the homeowner, “identified as a snake breeder, was arrested on suspicion of animal cruelty, a felony,” according to the Los Angeles Times. Police wore gas masks and “clutched Tasers” as they entered the home. “Rats scampered over furniture and scores of clear plastic boxes holding the snakes lined the walls.” The Orange County Register claimed that up until recently Bachman was a “regular joe.” A neighbor said, “Let me tell you, Bill was a nice guy, outspoken, knowledgeable. He talked to my grandkids about school.” According to the Los Angeles Times, Buchman’s mother died in 2011, which appeared to “have affected him profoundly.” Read the full story at The Los Angeles Times... Read the full story at The Orange County Register... Read the court decision
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Water Damage Sub-Limit Includes Tear-Out Costs

June 06, 2022 — Tred R. Eyerly - Insurance Law Hawaii
The Florida Court of Appeals affirmed the trial court's ruling that the homeowner policy's sub-limit for water damage included tear-out costs. Sec. First Ins. Co. v. Vazquez, 2022 Fla. App. LEXIS 1205 (Fla. Ct. App. Feb. 18, 2022). A discharge of water from the cast iron pipes caused damage to the home. The water escaped as a result of the failed cast iron pipes due to wear and tear, deterioration, and corrosion. The insurer acknowledged coverage for the water damage and paid $10,000 under the Limited Water Damage Endorsement (LWD Endorsement). The provision recited that "'[t]he limit of liability for all damage to covered property provided by this endorsement is $10,000 per loss." The insureds' suit argued they were entitled to additional benefits for the cost to tear out and replace a part of the concrete slab - an action necessary to reach the corroded pipes. The parties stipulated that the cost of the tear-out would be $40,000. The parties agreed that the LWD Endorsement provided coverage of both water damage and tear-out costs. They also agreed that the cost to repair and/or replace the corroded pipes was not covered. They disagreed, however, over the proper interpretation of the limitation of liability provision in the LWD Endorsement. The insured argued that the $10,000 limit applied to both water damage and tear-out costs. The insureds argued that the $10,00 limit applied only to water damage to covered property. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Playing Hot Potato: Indemnity Strikes Again

September 17, 2015 — Garret Murai – California Construction Law Blog
Indemnity can be like playing hot potato (for those of you closer to the Minecraft generation, in the game of hot potato, a metaphoric “hot potato” is tossed between (ahem amongst) players while music is playing, and when the music stops, the player holding the hot potato is out. It’s a barrel of monkeys, trust me.). Anyway, like hot potato, with indemnity an owner typically requires its general contractor to indemnify the owner (sometimes the property owner in TI projects and occasionally design professionals) from and against any and all claims arising out of, related to . . . blah, blah, blah . . . the general contractor’s scope of work . A general contractor in turn will usually require indemnity from its subcontractors. And subcontractors will require indemnity from their sub-subcontractors. And down the line it goes with each party pointing their finger at the next party down the proverbial “food chain.” But it doesn’t always happen that way as the next case, American Title Insurance Company v. Spanish Inn, Case No D067137, California Court of Appeals for the Fourth District (August 14, 2015), illustrates. Read the court decision
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Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
Mr. Murai may be contacted at gmurai@wendel.com

Top Developments March 2024

April 22, 2024 — Complex Insurance Coverage Reporter
CLAIMS-MADE COVERAGE Zurich Am. Ins. Co. v. Syngenta Crop Prot. LLC, 2024 Del. LEXIS 68 (Del. Feb. 26, 2024) Delaware Supreme Court concludes that a letter from a lawyer informing an insured of possible lawsuits without identifying potential plaintiffs or demanding payment is not a “claim for damages” within the meaning of claims-made CGL and umbrella liability policies. Citing case law from Delaware and other jurisdictions, it reasoned that, in the ordinary sense, a “claim for damages” (which the policies did not define) is “a demand or request for monetary relief by or on behalf of an identifiable claimant.” According to the court, the letter in question did not meet this definition because it did not identify any claimants “except in the vaguest terms” or request monetary relief on any claimant’s behalf, but rather communicated only a threat of future litigation. As a result, the letter was not a claim made before the policy periods at issue. POLLUTION EXCLUSION Wesco Ins. Co. v. Brad Ingram Constr., 2024 U.S. App. LEXIS 1488 (9th Cir. Jan. 23, 2024) A divided Ninth Circuit panel, applying California law, holds that a pollution exclusion* in a CGL policy does not preclude a duty to defend an underlying suit alleging physical injury from exposure to “clouds of toxic dust” deposited in the environment by a wildfire and released during clean up efforts. Citing MacKinnon v. Truck Ins. Exch., 73 P.3d 1205 (Cal. 2003), the majority explained that determining whether a “pollution event” (i.e., “environmental pollution”) resulting in excluded injury has occurred involves consideration of “the character of the injurious substance” and whether the exposure resulted from a “mechanism specified in the policy.” It concluded that a potential for coverage (and, therefore, a defense obligation) existed because, although wildfire debris may be considered a “pollutant” in certain circumstances, the mechanism alleged in the underlying complaint – “expos[ure] . . . to clouds of toxic dust during the loading and unloading of [the underlying plaintiff’s] truck” – did not clearly constitute an “event commonly thought of as pollution.” Read the court decision
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Reprinted courtesy of White and Williams LLP

Storm Breaches California River's Levee, Thousands Evacuate

March 20, 2023 — Associated Press - Engineering News-Record
WATSONVILLE, Calif. (AP) — A Northern California agricultural community famous for its strawberry crop was forced to evacuate early Saturday after the Pajaro River’s levee was breached by flooding from a new atmospheric river that pummeled the state. Across the Central Coast's Monterey County , more than 8,500 people were under evacuation orders and warnings Saturday, including roughly 1,700 residents — many of them Latino farmworkers — from the unincorporated community of Pajaro. Reprinted courtesy of Engineering News-Record ENR may be contacted at enr@enr.com Read the full story... Read the court decision
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