Certificates as Evidence of Additional Insured Coverage Are All the Rage, But You Deserve Better
August 30, 2021 —
Joseph L. Cohen, W. Mason & Sean Milani-nia - ConsensusDocsConsider the following scenario: the construction project is ready to proceed. The deal is done. The agreements have all been carefully crafted, with detailed provisions on insurance dedicated to reducing risk. Those provisions require the downstream trade contractors to furnish certificates of insurance listing the owner and prime contractor as additional insureds on the downstream contractor’s policies of insurance. A provision in the prime contract further requires the prime contractor to provide the owner with a certificate of insurance showing the owner as an additional insured on the prime contractor’s policies. At the ceremonial ground-breaking and right before work commences, the downstream contractors deliver their insurance certificates to the prime contractor and the prime contractor delivers its certificate plus the downstream certificates to the owner. From there, each insurance certificate will begin its final destination to the project file (either electronic or physical) where, with any luck, it will serve the regular stint before being discarded after the project’s successful conclusion. Otherwise, it will be retrieved under much stress and heavy scrutiny. The acceptance of insurance certificates is often viewed as standard industry practice, but should it be?
The answer is a resounding “no.” There are many form development and construction agreements in circulation that deem insurance certificates to be acceptable evidence of insurance. But, a certificate of insurance should not be relied upon because it does not mean that insurance has been placed. You deserve real evidence that the requisite additional insured coverage is in place (in the form of a policy endorsement), and here is why.
Reprinted courtesy of
Joseph L. Cohen, Fox Rothschild,
W. Mason, Fox Rothschild and
Sean Milani-nia, Fox Rothschild
Mr. Cohen may be contacted at jlcohen@foxrothschild.com
Mr. Mason may be contacted at wmason@foxrothschild.com
Mr. Milani-nia may be contacted at smilani@foxrothschild.com
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Contractors Liable For Their Subcontractor’s Failure To Pay Its Employees’ Wages And Benefits
November 01, 2022 —
Edward O. Pacer & David J. Scriven-Young - ConsensusDocsRecently, Illinois Governor J.B. Pritzker signed two House Bills that amend the Illinois Wage Payment & Collections Act, 820 ILCS 115 et. seq. (“Wage Act”), to provide greater protection for individuals working in the construction trades against wage theft in a defined class of projects. Pursuant to this new law, every general contractor, construction manager, or “primary contractor,” working on the projects included in the Bill’s purview will be liable for wages that have not been paid by a subcontractor or lower-tier subcontractor on any contract entered into after July 1, 2022, together with unpaid fringe benefits plus attorneys’ fees and costs that are incurred by the employee in bringing an action under the Wage Act. This new wage theft law follows several other states that have considered and passed similar legislation.
These amendments to the Wage Act apply to a primary contractor engaged in “erection, construction, alteration, or repair of a building structure, or other private work.” However, there are important limitations to the amendment’s applicability. The amendment does not apply to projects under contract with state or local government, or to general contractors that are parties to a collective bargaining agreement on a project where the work is being performed. Additionally, the amendment does not apply to primary contractors who are doing work with a value of less than $20,000, or work that involves only the altering or repairing of an existing single-family dwelling or single residential unit in a multi-unit building.
Reprinted courtesy of
Edward O. Pacer, Peckar & Abramson, P.C. (ConsensusDocs) and
David J. Scriven-Young, Peckar & Abramson, P.C. (ConsensusDocs)
Mr. Pacer may be contacted at epacer@pecklaw.com
Mr. Scriven-Young may be contacted at dscriven-young@pecklaw.com
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De-escalating The Impact of Price Escalation
August 10, 2021 —
Brian C. Padove - ConsensusDocsWhat happens when construction material prices abruptly rise by 15%, 35%, 50%? Moreover, what happens to a construction project when such volatility occurs? While there is no definite answer, delays in procuring such materials and associated cost overruns will likely impact the construction project. The last 15 months contractors have had to work through extraordinary construction material price increases, such as a 90% price increase for lumber from April 2020 to April 2021. While there is no statistic quantifying the impact these increases have had on the construction industry, the increases surely have had an influence, whether it has been through lost profits, delays, or damage to contractors’ otherwise strong reputation for timely performance.
Considerations Prior To Contract Execution
The first way to mitigate price escalation is identifying materials most susceptible to price volatility during the bidding process and then having an open discussion with upstream parties regarding the potential price volatility. Additionally, the bid may also include either (1) an allowance for the materials providing additional funds, if necessary, should the material price increase, or (2) a shortened timeframe in which the bid is open, which would lessen the time in which a price shift may occur.
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Brian C. Padove, Watt, Tieder, Hoffar & Fitzgerald, LLPMr. Padove may be contacted at
bpadove@watttieder.com
Florida Adopts Less Stringent Summary Judgment Standard
January 25, 2021 —
John A. Rine & Sarah Hock - Lewis BrisboisOn New Year’s Eve, Florida’s Supreme Court issued an amendment to essentially apply the federal summary judgment standard to cases in Florida state courts starting on May 1, 2021. See In Re: Amendments to Florida Rule of Civil Procedure 1.510, No. SC20 1490 (Fla. Dec. 31, 2020) (per curiam). This change brings Florida in line with the majority of states (38).
Summary judgment is easier to obtain under the federal standard. A moving party need only show that the opposing party lacks the evidence to support its case at trial. Under the soon-to-be obsolete Florida standard, however, moving parties had to entirely “disprove the nonmovant’s theory of the case in order to eliminate any issue of fact." See id. at 3. The nonmoving party could defeat a summary judgment motion by showing that there was a slight doubt on any material fact. See id. at 4-5.
This change is good news for defendants and their insurers. With summary judgment easier to obtain, weak claims can be defended prior to trial. Claims may be resolved more quickly and economically. The threat of summary judgment also gives defendants powerful leverage in settlement discussions. The shift may also reduce the backlog of cases accumulated during the suspension of jury trials over the past summer.
Reprinted courtesy of
John A. Rine, Lewis Brisbois and
Sarah Hock, Lewis Brisbois
Mr. Rine may be contacted at John.Rine@lewisbrisbois.com
Ms. Hock may be contacted at Sarah.Hock@lewisbrisbois.com
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Are You Satisfying WISHA Standards?
October 23, 2018 —
Ceslie Blass - Ahlers Cressman & Sleight PLLC BlogMany general contractors and property management companies hand over project sites to subcontractors and have little, if anything, to do with the construction work that occurs. However, under RCW 49.17, the Washington Industrial Safety and Health Act (WISHA), general contractors and some property management companies/owners are still responsible for workplace safety for the employees of their subcontractors and independent contractors.
The Washington Supreme Court held in Stute v. PBMC that a general contractor could be held liable for injury to a subcontractor’s employee sustained as a result of a WISHA violation.[1] The Stute decision changed the landscape of workplace safety, imposing an expansive, per se liability on general contractors for workplace injuries. Stated differently, general contractors have a specific, non-delegable duty to ensure compliance with WISHA regulations, which extends to all employees on the project site.[2] Washington courts have held that such “expansive liability is justified because ‘a general contractor’s supervisory authority is per se control over the workplace.’”[3] Thus, the non-delegable duty requires general contractors to ensure care is exercised by anyone, even an independent contractor to whom the performance of the duty is entrusted.
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Ceslie Blass, Ahlers Cressman & Sleight PLLCMs. Blass may be contacted at
ceslie.blass@acslawyers.com
Oregon Bridge Closed to Inspect for Defects
February 25, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to The Oregonian, the Morrison Bridge in Multnomah county, Oregon will be closed Sunday, February 23rd “so county crews can inspect the decking that has caused problems since it was installed” in 2012. The “southernmost eastbound lane has been closed for weeks while crews conducted inspections.”
The defects appeared “almost immediately after the project” was completed, reported The Oregonian. Drivers have “dealt with a bumpy, noisy ride as the loose decking panels flopped beneath them.”
Multnomah county has sued “Conway Construction, the company the installed the decking, as well as Strongwell Corp., the company that supplied Conway with the decking materials, and Zellcomp, the company that made the decking materials, to determine who should foot the bill for extensive repairs or outright replacement of the decking.”
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West Coast Casualty’s 25th Construction Defect Seminar Has Begun
May 16, 2018 —
Beverley BevenFlorez-CDJ STAFFThe first day of this year’s West Coast Casualty Seminar has concluded, with two more days ahead to learn, network, and discuss the construction defect industry’s current trends.
Don’t forget to stop by the Bert L. Howe & Associate’s exhibit so that you can participate in their Sink a Putt for Charity Golf Challenge. As in the past, attendees can participate for free in the BHA golf challenge and win a $25 Amazon gift card, and for every successful putt made, BHA will make a $25 cash donation in the golfer’s name to be distributed equally between each worthy organization. This year, participant’s efforts on the green will help benefit three cancer fighting institutions that are dedicated to treating and eradicating children’s cancer: Hawaii’s Children’s Cancer Foundation, St. Jude Children’s Research Hospital, and Shriners Hospital for Children. BHA is also raffling Dodger’s tickets, so you won’t want to miss their exhibit. You may read more about this year’s exhibit at
BHA HAS A NICE SWING and take a look back at previous exhibits,
20 YEARS OF BHA AT WEST COAST CASUALTY'S CD SEMINAR: CHRONICLING BHA'S INNOVATIVE EXHIBITS.
Want some help maximizing your work-play schedule? Check out
CDJ’s Sample Itinerary to get the Most out of West Coast Casualty’s Construction Defect Seminar that includes the seminar schedule as well as dining and event suggestions. We also have included suggestions for exploring the Greater Anaheim area:
BEYOND THE DISNEYLAND RESORT: DINING,
BEYOND THE DISNEYLAND RESORT: SPECIAL EVENTS,
BEYOND THE DISNEYLAND RESORT: MUSEUMS, and
BEYOND THE DISNEYLAND RESORT: WORLD CLASS SHOPPING EXPERIENCES.
Last week, Don MacGregor wrote a not-to-be-missed piece on
THE EVOLUTION OF CONSTRUCTION DEFECT TRENDS AT WEST COAST CASUALTY SEMINAR.
Thursday, this year’s West Coast Casualty awards will be presented. To learn more about these coveted awards, please see
A LOOK BACK AT THE OLLIES and
AN ERA OF LEGENDS.
We hope you enjoy days two and three of the seminar!
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Good Ole Duty to Defend
August 02, 2017 —
David Adelstein - Florida Construction Legal UpdatesThe good ole duty to defend. Certainly, a duty that should not be overlooked.
A commercial general liability insurer has two duties to its insured when it comes to third-party claims: 1) the duty to defend its insured and 2) the duty to indemnify its insured.
The insurer’s duty to defend its insured will always be broader than its duty to indemnify because this duty is triggered by the allegations in the lawsuit. (For this precise reason, insurers will oftentimes defend their insured under a reservation of rights.) The duty to defend is a very important duty as it is the first duty that typically comes into play when a third-party claim / action is initiated against the insured. Getting the insurer on board to provide a defense is an initial focus. One that cannot be neglected or overlooked.
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
Dadelstein@gmail.com
