Another Reminder that Your Construction Contract Language Matters
June 06, 2018 —
Christopher G. Hill - Construction Law MusingsHere at Musings, I have often (some might say too often) discussed the fact that in Virginia (as well as other places), your construction contract language will be strictly enforced. I have also discussed the need for attorney fees provisions as well as other language in order to mitigate your risk as a contractor. A recent case from the City of Roanoke Circuit Court discussed both of these principals and their intersection.
In LAM Enterprises, LLC v. Roofing Solutions, Inc., the Roanoke Court looked at a contract between LAM and Roofing Solutions, Inc. that contained two provisions of the construction contract between the parties. The first provision limited the liability of Roofing Solutions to the contract price. The second provision is a relatively typical “prevailing party” attorney fees provision in which the winner of any lawsuit would be entitled to collect its attorney fees. For the specific language of these provisions, I commend the opinion linked above for your reading.
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Christopher G. Hill, The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Contractors Can No Longer Make Roof Repairs Following Their Own Inspections
July 02, 2018 —
Jason Feld & Alex Chazen - Kahana & Feld LLPCalifornia law mandates that any person who conducts roof inspections for a fee can no longer effectuate the actual repairs to the same property. Effective January 1, 2018, Business & Professions Code Section 7197 (Unfair Business Practices) deems it to be an unfair business practice for a home inspector who charges a homeowner a monetary fee for inspecting the property, to perform or offer to perform additional repairs due to the inherent financial interest and conflict raised by identifying alleged defects necessitating repairs. The new law is a result of California AB 1357, which was signed into law on October 5, 2017. The goal of the new law is to disincentivize a roof inspector from creating a report for the sole purpose of obtaining a bid to perform those documented repairs. The roof contractor can perform repairs identified in their report only after a twelve month “cooling period” which provides the homeowner an opportunity to obtain multiple bids/estimates for repairs based upon the inspector’s report. The new law also discourages home inspectors from providing a list of contractors who provide monetary referral fees back to the home inspector upon receiving repair work from the homeowner based exclusively on the home inspection report.
The California Business & Professions Code Section 7195(a)(1) defines a “home inspection” as a “non-invasive, physical examination, performed for a fee in connection with the transfer…of the real property…or essential components of the residential dwelling.” Home inspection includes “any consultation regarding the property that is represented to be a home inspection or any confusingly similar term.” Business & Professions Code section 7195(a)(2) further defines a “home inspection” as including energy efficiency and solar. A “home inspection report” is a written report prepared for a fee issued after an inspection. Business & Professions Code section 7195(c). It is noted that a home inspector does not have to be a licensed architect, professional engineer, or general contractor with a Class “B” license issued by the California Contractors State License Board, but “it is the duty of a home inspector who is not licensed as a general contractor, structural pest control operator, or architect, or registered as a professional engineer to conduct a home inspection with the degree of care that a reasonably prudent home inspector would exercise. Business & Professions Code section 7196.
Reprinted courtesy of
Jason Feld, Kahana & Feld LLP and
Alex Chazen, Kahana & Feld LLP
Mr. Feld may be contacted at jfeld@kahanalaw.com
Mr. Chazen may be contacted at achazen@kahanafeld.com
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N.J. Governor Signs Bill Expanding P3s
September 04, 2018 —
Nick Steingart - Construction ExecutiveGovernment entities in New Jersey that enter into public-private partnerships to help finance public construction projects are now required to utilize a project labor agreement (PLA) and pay state prevailing wages, among other requirements. Previously, P3s were only available to state and county colleges, but did not contain prevailing wage or PLA mandates.
The new law, Senate Bill 865, allows the state and its subdivisions, including counties, municipalities and school districts, to enter into agreements with private funding sources provided they follow the additional mandates such as abiding by the state’s prevailing wage law and utilizing a union-only PLA for construction of the project.
Reprinted courtesy of
Nick Steingart, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Mr. Steingart may be contacted at
steingart@abc.org
Supreme Court of Idaho Rules That Substantial Compliance With the Notice and Opportunity to Repair Act Suffices to Bring Suit
July 31, 2018 —
Lian Skaf - The Subrogation StrategistIn Davison v. Debest Plumbing, Inc., 416 P.3d 943 (Ida. 2018), the Supreme Court of Idaho addressed the issue of whether plaintiffs who provided actual notice of a defective condition, but not written notice as stated in the Notice and Opportunity to Repair Act (NORA), Idaho Code §§ 6-2501 to 6-2504, et. seq., substantially complied with the act and if the plaintiffs’ notice was sufficient to bring suit. Section 6-2503 of the NORA states that, “[p]rior to commencing an action against a construction professional for a construction defect, the claimant shall serve written notice of claim on the construction professional. The notice of claim shall state that the claimant asserts a construction defect claim against the construction professional and shall describe the claim in reasonable detail sufficient to determine the general nature of the defect.” Any action not complying with this requirement should be dismissed without prejudice. The court held that the defendant’s actual notice of the defect was sufficient to satisfy the objectives of the NORA and, thus, the plaintiffs’ action complied with the NORA.
In Davison, Scott and Anne Davison hired general contractor Gould Custom Builders (Gould) to remodel a vacation home in McCall, Idaho. Gould subcontracted out the plumbing work to Debest Plumbing (Debest). This work included installing a bathtub. When the Davisons arrived at their home for the first time on July 25, 2013, they noticed a leak from the subject bathtub. The Davisons contacted Gould and, the next morning, Gil Gould arrived with a Debest employee to inspect the home. In addition to inspecting the home, the Debest employee repaired the leak and helped Gould remove some water-damaged material.
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Lian Skaf, White and Williams, LLPMr. Skaf may be contacted at
skafl@whiteandwilliams.com
It’s Time to Change the Way You Think About Case Complexity
August 07, 2018 —
Ben Patrick - Gordon & Rees Construction Law BlogThere are few things that lawyers love more than telling war stories. Partially, that’s because many lawyers either only or primarily have friends who are lawyers, and war stories are a way for lawyers to relate to each other—your barber doesn’t understand the pain of reading through 5 paragraphs of irrelevant objections posed to each of 75 interrogatories, but your fellow lawyers will. One common feature of war stories is a note regarding how much was at issue in the case. “I was handling this $25 million claim once….” Lawyers include the dollar figure in dispute as a shorthand for the complexity of the case they’re talking about. “Oh, we’ll be in depositions for a month solid, this is a $10 million case!”
I don’t know where I picked up this habit, but I know exactly how I learned to rethink it. A friend of mine, as in-house counsel, was handling a case worth over a billion dollars. When he told me about it, my jaw dropped. One of the first things I asked him was, how do you manage a case that big? And he told me about the several law firms he had engaged, all the people working on it. But then he said: it’s not really a complicated case. There were only 4-5 real factual questions, and a similar number of legal ones. It’s just that every factual question had a very high price tag associated with it. The high price tag doesn’t make the factual question any more complex, or any harder to litigate. For example, your builders’ risk policy either has coverage for flood damage or it doesn’t. If it does, then it doesn’t matter whether the flood washed the whole building away or just some materials from the laydown area—coverage is coverage, irrespective of quantum.
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Ben Patrick, Gordon & Rees Scully MansukhaniMr. Patrick may be contacted at
jpatrick@grsm.com
Administrative and Environmental Law Cases Decided During the U.S. Supreme Court’s 2017-2018 Term
July 28, 2018 —
Anthony B. Cavender & Amy L. Pierce - Gravel2GavelUnlike other Terms, only a handful of cases addressed administrative and environmental law issues in the U.S. Supreme Court’s 2017-2018 Term. However, the next Term of the Court promises to be more active in these areas.
- On January 22, 2018, the Court issued a unanimous opinion in the Clean Water Act (CWA) case, Nat’l Assoc. of Mfrs. v. Dep’t of Defense, holding that the plain language of the CWA requires the appeal of the Environmental Protection Agency’s (EPA) redefinition of “waters of the United States” (WOTUS Rule) must be heard first in the federal district courts. Whereas all appeals of most EPA CWA effluent limitation rules must be heard in the federal Courts of Appeals, Congress chose not to do this with respect to this definitional rule.
The Court points out that reviews in the Courts of Appeals must take place within 120 days of the rule’s promulgation, but any review of a rule in the federal district court must take place within 6 years of the date the claim accrues.
Reprinted courtesy of
Anthony B. Cavender, Pillsbury Winthrop Shaw Pittman and
Amy L. Pierce, Pillsbury Winthrop Shaw Pittman
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com
Ms. Pierce may be contacted at amy.pierce@pillsburylaw.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
Massachusetts Judge Holds That Insurer Breached Its Duty To Defend Lawsuit After Chemical Spill
October 16, 2018 —
Lawrence J. Bracken, II & Alexander D. Russo - Hunton Insurance Recovery BlogA District Court Judge for the District of Massachusetts recently ruled that Ace Property and Casualty Insurance Co. breached its duty to defend its insured in a lawsuit brought by Plaistow Project, LLC, after a family owned laundromat leaked chemicals onto Plaistow Project’s property. Plaistow Project, LLC v. ACE Prop. & Cas. Ins. Co., No. 16-CV-11385-IT, 2018 WL 4357480, (D. Mass. Sept. 13, 2018). Plaistow Project sued State Line Laundry Services in state court, and ACE denied coverage under the pollution exclusion in State Line Laundry’s insurance policy. Plaistow Project then settled with State Line Laundry. Under the settlement terms, Plaistow Project was assigned State Line Laundry’s rights against ACE.
In the subsequent coverage litigation, Plaistow Project alleged that ACE had breached its duty to defend State Line Laundry under its insurance policy. ACE argued that (1) the burden was on the policyholder to demonstrate that the policy’s “sudden and accidental” exception applied to the policy’s pollution exclusion; and (2) the policyholder could not show the “sudden and accidental” exception applied based on the complaint.
Reprinted courtesy of
Lawrence J. Bracken, II, Hunton Andrews Kurth and
Alexander D. Russo, Hunton Andrews Kurth
Mr. Bracken, may be contacted at lbracken@HuntonAK.com
Mr. Russo may be contacted at arusso@HuntonAK.com
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