New York Amends Prompt Payment Act: Retainage Above 5% in Private Construction Contracts Now Void
February 10, 2026 —
Mark A. Snyder, Levi W. Barrett, Patrick T. Murray & Skyler L. Santomartino - Peckar & Abramson, P.C.In 2023 New York overhauled its Prompt Payment Act. The
2023 amendments, largely aimed at restricting the amount of retainage that can be withheld on private projects, were unclear about whether parties could contract around the statute, as they can with other provisions of the statute. The State Legislature recently clarified that issue.
On December 19, 2025, New York enacted a new law, tightening the State’s Prompt Payment Act retainage laws by amending the Prompt Payment Act under General Business Law § 757. Under § 757, the new law renders void any contract provision in private construction contracts that requires retainage in excess of 5% of the total contract sum, meaning owners cannot hold more than 5% from their prime contractors and prime contractors cannot hold more than 5% from their subcontractors.
Reprinted courtesy of
Mark A. Snyder, Peckar & Abramson, P.C.,
Levi W. Barrett, Peckar & Abramson, P.C.,
Patrick T. Murray, Peckar & Abramson, P.C. and
Skyler L. Santomartino, Peckar & Abramson, P.C.
Mr. Snyder may be contacted at msnyder@pecklaw.com
Mr. Barrett may be contacted at lbarrett@pecklaw.com
Mr. Murray may be contacted at pmurray@pecklaw.com
Mr. Santomartino may be contacted at ssantomartino@pecklaw.com
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LA Fire Victims Can Pursue City Utility Claims, Judge Rules
March 10, 2026 —
Jef Feeley & Maxwell Adler - BloombergThe water and power utility that serves the city of Los Angeles must face hundreds of lawsuits faulting its response to the massive 2025 wildfire that leveled one of the city’s premier seaside neighborhoods and caused tens of billions of dollars in damage.
In a significant victory for fire victims, Los Angeles Superior Court Judge Samantha Jessner concluded in a
written ruling Thursday that a unique California law allows property and business owners to pursue claims that the Los Angeles Department of Water and Power failed to supply enough water to fight the blaze that consumed the Pacific Palisades area.
Over strong objections from lawyers for the nation’s largest public utility, Jessner finalized a tentative ruling she issued last week concluding victims have a legal basis to move forward with allegations a city reservoir drained for repairs left fire hydrants with inadequate water pressure and helped the wind-whipped blaze get out of control.
Reprinted courtesy of
Jef Feeley, Bloomberg and
Maxwell Adler, Bloomberg Read the full story...
Southwest Super Lawyers Recognizes 50 Snell & Wilmer Attorneys in 2026 Rankings
June 15, 2026 —
Snell & WilmerPHOENIX (April 22, 2026) – Snell & Wilmer is pleased to announce that 50 attorneys in the Phoenix and Tucson offices have been selected for inclusion in the 2026 Southwest Super Lawyers publication. Of those 50, four were recognized for the first time and 24 were recognized as Southwest Rising Stars. Super Lawyers is a listing of lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. The selection process is multi-phased and includes independent research, peer nominations, and peer evaluations. Super Lawyers was first published in 1991 by Law & Politics and was acquired by Thomson Reuters, Legal in February 2010. Thomson Reuters is a leading source of information for businesses and professionals. The below Snell & Wilmer attorneys have been selected for inclusion in the 2026 Southwest Super Lawyers rankings.
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Snell & Wilmer
Turnover Traps for Community Associations: Investigate First, Release Claims Later
April 14, 2026 —
Nicholas B. Vargo - Ball Janik LLPTurnover of a community association from developer control to owner control is a uniquely vulnerable moment. Developers are increasingly presenting Florida condominium and homeowners’ associations with “standard” settlement or release agreements at turnover, often being framed as routine steps to finalize the transition of control. In reality, these agreements can have sweeping consequences, including the release of construction-defect claims before the association has conducted any meaningful independent evaluation.
The developer has years of project knowledge and access to plans, subcontractors, and internal records. The newly elected board is just beginning to organize, obtain documents, and understand the property’s condition. Many defects, especially those involving roofing, waterproofing, windows, or structural components, are latent and not yet visible. Signing a release at this stage means the association is making a binding decision under conditions of uncertainty, without full information, to release all future potential claims.
Over the last few years, there has been a rise in reports of developers offering a packaged deal: they agree to complete certain repairs, often minor punch-list or cosmetic items, and to “forgive” an alleged financial deficit (often around $50,000) supposedly owed by the association from the developer-control period. In exchange, the association is asked to sign a broad release covering all claims, including known and unknown construction defects. To a new HOA board that received their community with limited operating and reserve funds, they are left with a difficult decision to either accept the developer’s offer or assess their owners to pay this alleged debt.
These agreements are occasionally presented through community management companies, which may describe them as “standard” or "routine.” Whether due to misunderstanding or influence from the developer, management companies can unintentionally reinforce the idea that signing is expected. Any recommendation provided to HOAs about whether to sign these releases could open community management to liability down the road. The best practice for both associations and community managers is to refer any agreements to be reviewed by general counsel for the association.
The following two case studies illustrate the real-world consequences:
Case Study One: A newly transitioned board relies on its management company to negotiate with the developer-builder to resolve irrigation issues, pond concerns, and signage deficiencies, along with forgiving an asserted financial shortfall. In exchange, the board signs a broad release covering all claims, including latent defects.
Within a year, several punch-list items remain incomplete, and more serious issues arise. When the association demands completion, the developer delays, prompting the association to seek advice on how to enforce the settlement agreement. The association hires counsel to hold the developer responsible for both the previously agreed-upon items and newly identified construction defects. However, when the association brings claims against the developer, the developer points to the release of all potential construction defects in the community. Thus, the only remaining remedy is limited to enforcement of the specific punch-list terms. The community, still relatively new, has no viable claims against the developer-builder for the construction defects. With warranties expired and the release, the association must fund repairs through special assessments, despite defects that would otherwise have been actionable.
Case Study Two: A community is presented with a similar agreement as above. The management company encourages execution, suggesting it is standard and even telling the board to “name your price.” The developer also pressures the newly elected board to sign.
Instead of signing, the board consults with their attorney. Counsel advises the board not to sign the release and recommends further investigation. Engineers are retained and identify early indicators of broader issues, including stucco cracking, water intrusion, and irrigation deficiencies. Based on this information, the association declines to sign the release. Subsequent evaluation reveals potentially significant construction-defect claims, allowing the community to pursue recovery that would have been lost under the proposed agreement.
These scenarios underscore a fundamental point: signing a release at turnover is not an administrative formality—it is a major legal decision. Board members act in a fiduciary capacity on behalf of their community, and their decisions can bind all current and future owners. At turnover, an association’s right is to investigate and pursue claims. Preserving that right until a full and independent evaluation is completed is not adversarial—it is responsible governance.
Accordingly, associations should retain independent evaluations of the property and consult qualified legal counsel before signing any “standard” agreements, especially ones involving a release of future claims.
Nicholas B. Vargo is a partner in Ball Janik LLP’s Construction Practice Group. He may be reached at nvargo@balljanik.com.
GRSM Trial Team Holds Alameda County Asbestos Verdict to $900,000 Against $50 Million Demand
July 27, 2026 —
Gordon Rees Scully MansukhaniGordon Rees Scully Mansukhani Partners John Katerndahl and Vincent Gunter recently obtained an outstanding trial result for a manufacturer of asbestos-containing electrical cable, holding a jury verdict to $900,000 against a $50 million demand following an eight-week trial in Alameda County Superior Court, which is among the most challenging asbestos venues in the country. The GRSM team also included Associate Brandon Sanchez, on-site trial Paralegal Laura Vitanova, and Paralegal Kerrie Lease.
The plaintiffs, the surviving spouse and four children of a former painter who died of mesothelioma, alleged that the decedent was exposed to asbestos from the company’s electrical cable during construction of a California nuclear power facility. GRSM’s client was the sole remaining defendant at trial. The plaintiffs asked the jury for $50 million and called 15 witnesses across their case-in-chief and rebuttal.
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Gordon Rees Scully Mansukhani
Your AEC Firm Has a Memory Problem. Here Is How to Fix It
June 01, 2026 —
Aarni Heiskanen - AEC BusinessAEC companies trying to operationalize AI often find they lack the data foundation on which to build. There may be an abundance of data hidden in documents, but you can’t reliably use it for AI.
The lack of data quality was a key topic discussed at the AI in AEC 2026 conference. During the event, I met many experts working to solve this problem, including
Pavlina Nikolova,
Egnyte‘s EMEA AEC Practice Lead. The chat and her presentation highlighted the challenges and ways to overcome them.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
Suit Limitation Provision Eliminates Wind Loss Claim
July 27, 2026 —
Tred R. Eyerly - Insurance Law HawaiiThe insurer’s motion for judgment on the pleadings was granted after the insured failed to file suit against the insurer within the policy’s two-year suit limitation provision. Interstate Investments, LLC v. Mt. Hawley Ins Co., 2026 U.S. Dist. LEXIS 98108 (S.D. N. Y. May 4, 2026).
On or before June 27, 2023, a wind, hail and rainstorm damaged Interstate’s property in Oklahoma. Interstate filed a claim under its policy with Mt. Hawley. The policy provided that New York law applied and contained a two- year suit limitation provision.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Reducing Rework on Construction Projects Benefits Budget, Schedule and Financial Loss
February 10, 2026 —
Brian Clarke - Construction ExecutiveThe costs of not building it right the first time is statistically staggering—some research suggests up to 20% of the total project costs. This article highlights the costs of re-work, provides a financial worksheet to track the costs of re-work, and a trusted tool to help reduce the impact of re-work.
Typically, when discussing rework, one thinks of the labor and material costs, but there are other costs associated with rework that are less easily quantified:
- Liquidated damages and related legal costs
- Potential for increasing safety incidents associated with rework
- Morale loss due to performing rework
- Loss of previously trained workers due to delays caused by rework
- Reputational loss and the inability to bid on future work
- Challenges of future work to be performed due to schedule delays on a current project
Reprinted courtesy of
Brian Clarke, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
Mr. Clarke may be contacted at brianclarke1121@aol.com
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