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Those negotiating new contracts now are undoubtedly cognizant that they are negotiating in the midst of an unpredictable future that is tipping the historical negotiating balance.

How Will Today’s Pandemic Impact Tomorrow’s Construction Contracts?

Monday, October 26, 2020 — Levi W. Barrett, Nathan A. Cohen & Mark A. Snyder - Peckar & Abramson

The emergence of COVID-19 has created a new set of challenges in the already complex world of negotiating construction contracts. In the pre-COVID-19 era, general contractors, construction managers and those negotiating on their behalf, needed to balance a variety of fairly well-established legal risks and exposures and commercial realities with the need to maintain a positive relationship with their counterparty. While many are rightfully concerned with addressing the impacts of COVID-19 to their on-going projects, those negotiating new contracts now are undoubtedly cognizant that they are negotiating in the midst of an unpredictable future that is tipping the historical negotiating balance. The following presents some crucial areas to focus on when negotiating and drafting your contracts in this new era.

Contract Terms Through the COVID-19 Lens

Contractors should examine proposed new contracts carefully to identify rights that afford COVID-19 protections and identify contractual obligations that create COVID-19 commercial risks.

Specific attention should be paid to those sections relating to force majeure/excusable delay, emergencies, changes (including changes in law), contingency, suspension and termination, site investigation as well as all representations and warranties. The paramount concern in examining these provisions is to ensure that they not only entitle the contractor to relief for those unknown events, emergencies and changes, but that they also contain sufficient entitlement for the contractor to obtain both time extensions and financial compensation for unknown impacts of a known event – the COVID-19 pandemic.

Reprinted courtesy of Levi W. Barrett, Peckar & Abramson, P.C., Nathan A. Cohen, Peckar & Abramson, P.C.and Mark A. Snyder, Peckar & Abramson, P.C.

Mr. Barrett may be contacted at lbarrett@pecklaw.com
Mr. Cohen may be contacted at ncohen@pecklaw.com
Mr. Snyder may be contacted at msnyder@pecklaw.com


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If a material breach is a “substantial factor” in causing damages, the breaching party must answer for all damages that were reasonably contemplated by the parties when they formed the contract.

Comparative Breach of Contract – The New Benefit of the Bargain in Construction?

Monday, October 26, 2020 — Steven Hoffman - Florida Construction Law News

Ask most Florida Construction Law practitioners, and you will likely hear that liability may not be apportioned in “pure” breach of contract cases via the Comparative Fault Act, section 768.81, Florida Statutes (the “Act”). If a material breach is a “substantial factor” in causing damages, the breaching party must answer for all damages that were reasonably contemplated by the parties when they formed the contract. Claimants argue that matters of contract should be governed strictly by the agreement, and risk can be controlled by negotiated terms, including waivers and limitations. Defendants complain that construction projects are collaborative, multi-party affairs, and strict application of contract principles leads to harsh results for relatively minor comparative fault for the same or overlapping damages.

The notion of apportioning purely economic loss contract damages based on comparative fault is not new. Since April 2006, Florida has been a “pure” comparative fault jurisdiction with limited exceptions. Prior to the amendment, tort liability for non-economic damages was purely comparative, but liability for economic damages was typically a combination of joint and several liability with an additional exposure based on comparative fault.

Reprinted courtesy of Steven Hoffman, Cole, Scott & Kissane

Mr. Hoffman may be contacted at Steven.Hoffman@csklegal.com

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Hurricane Matthew damaged the Greater Hall Temple Church of God's (Church) roof.

Insured's Experts Excluded, But Insurer's Motion for Summary Judgment Denied

Monday, October 26, 2020 — Tred R. Eyerly - Insurance Law Hawaii

Despite barring the insured's expert witnesses from testifying as to the cause of the loss, lay witnesses were still available, making the district court's award of summary judgment to the insurer improper. Greater Hall Temple Church of God v. Southern Mut. Church Ins. Co., 2020 U.S. App. LEXIS 21934 (11th Cir. July 15, 2020).

Hurricane Matthew damaged the Greater Hall Temple Church of God's (Church) roof. Leaks occurred, causing water damage to the Church's interior. A claim was submitted to Southern Mutual. The policy did not cover loss caused by water. Nor did it cover loss to the interior of buildings unless the rain entered through openings made by a specified peril. An independent adjuster found that the damage was caused not by wind, but by pre-exisiting structural issues. Southern Mutual denied the claim.

The Church filed suit. Southern Mutual moved for summary judgment and also moved to strike three of the Church's expert witnesses. The district court agreed that none of the witnesses could qualify as experts. Two of the witnesses did not have the requisite experience nor had they used a sufficiently reliable methodology formulating their opinions. A third expert was barred because his expert opinion had not been timely disclosed. Thereafter, Southern Mutual's motion for summary judgment was granted because the Church had not provided admissible evidence that damage to the Church's roof was caused by Hurricane Matthew.

Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Building Space

October 26, 2020 — Jessica Porter - Construction Executive

The effects of COVID-19 on the global economy are far-reaching, and the construction industry is no exception. No one can predict precisely how the shutdowns and new way of living will impact the industry long term. Though business will never return to normal, it will continue, and construction will adapt.

The markets most likely to experience significant change include health care and office construction. Some markets, including hospitality, arena and convention centers, may never return to the construction levels contractors once experienced. The jury is still out on education and municipal construction, as the United States awaits guidelines on how to reopen public schools, and colleges and universities go virtual.

Reprinted courtesy of Jessica Porter, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Ms. Porter may be contacted at porter@constructionexec.com

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COVID-19 Halts Construction on $200M Anchor Project at Heartwood Preserve in Omaha

October 26, 2020 — Star-Herald - Engineering News-Record

Construction is about to stall on a roughly $200 million anchor office project at the Heartwood Preserve site, in light of the COVID-19 crisis.
California -based Applied Underwriters, a national workers' compensation insurer, confirmed that it is suspending construction temporarily in part to "protect" workers and suppliers involved in building its new office complex on a 50-acre stretch southwest of 144th and Pacific Streets .

ENR may be contacted at ENR.com@bnpmedia.com

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Portland, Ore., Forges Ahead With Ambitious Affordable Housing Construction Goals

October 26, 2020 — Oregonian - Engineering News-Record

Portland has committed to building 720 new affordable housing units downtown as part of its ambitious Broadway Corridor redevelopment, but to meet that goal it may have to shift some of that housing to an auxiliary site across the railroad tracks from the main project.
And the city will have to overcome a legacy of failed housing goals at other major redevelopments. Backers say they are cognizant of those setbacks, and are structuring this project differently in hopes of avoiding past missteps.

ENR may be contacted at ENR.com@bnpmedia.com

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Protecting Your Clients Against Construction Defect Claims

October 26, 2020 — Beverley BevenFlorez – CDJ Staff

This one-day seminar will cover the following topics: Update in Building Products, LEED and other Certifications; High-Efficiency HVAC; Cost Impacts; Federal, State and Local Funding Programs; Designer/Engineer Standard of Care; Engineering Practicalities; and Environmental Impact Studies. It is relevant for Architects, Attorneys, Contractors, Engineers, Government Employees, Insurance Professionals, and Municipal Employees.

December 2nd, 2020
Live Webcast

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Had COVID-19 not hit, the Colorado Legislature may have passed bills that would have had a severely negative impact on the home building industry.

Colorado’s Abbreviated Legislative Session Offers Builders a Reprieve

Monday, October 26, 2020 — David M. McLain – Colorado Construction Litigation

Would you believe me if I told you that this year could have been worse for builders? Had COVID-19 not hit, the Colorado Legislature may have passed bills that would have had a severely negative impact on the home building industry. In response to the COVID-19 pandemic, the Legislature temporarily adjourned in mid-March, 67 days into the 120-day legislative session. After a two-month recess, the Legislature returned for approximately one month to pass critical bills including the state budget, the school finance act and what to do with the money from the federal CARES Act. Of the bills on the calendar when the Legislature temporarily adjourned, legislators focused on those that were “fast, free, and friendly,” and let the others fall by the wayside.

Bills that died included SB 20-138, which would have extended Colorado’s statute of repose for construction defect claims from six plus two years to 10 plus two years. The bill also contained a number of accrual and tolling provisions, which would have made it harder for builders to convince tribunals that claims were untimely. This bill died on the Senate floor, for lack of support. We will see whether plaintiffs’ attorneys will revive this effort next year.

SB 20-093, while not an outright ban on arbitration or a legislative overturning of the Vallagio decision, would have made it harder to administer and more difficult to get cases into arbitration. The bill died under the “fast, free, and friendly” test, i.e., it faced too much opposition. I expect to see this bill again next year, in some form.

Reprinted courtesy of David McLain, Higgins, Hopkins, McLain & Roswell

Mr. McLain may be contacted at mclain@hhmrlaw.com

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Judge Stephen V. Wilson of the Central District of California, entered the latest ruling in the ongoing saga of the COVID-19 business interruption coverage dispute between celebrity plaintiff’s attorney Mark Geragos and Insurer Travelers.

Despite Misapplying California Law, Federal Court Acknowledges Virus May Cause Physical Alteration to Property

Monday, October 26, 2020 — Scott P. DeVries, Michael S. Levine & Michael L. Huggins - Hunton Insurance Recovery Blog

On August 28, Judge Stephen V. Wilson of the Central District of California, entered the latest ruling in the ongoing saga of the COVID-19 business interruption coverage dispute between celebrity plaintiff’s attorney Mark Geragos and Insurer Travelers.

The case, 10E, LLC v. The Travelers Indemnity Co. of Connecticut, was filed in state court. Travelers removed to federal court, where Geragos sought remand and Travelers moved to dismiss. Judge Wilson denied remand and granted the Motion to Dismiss, finding plaintiff did not satisfactorily allege the actual presence of COVID-19 on insured property or physical damage to its property. This holding is inconsistent with long standing principles of California insurance law and appears to improperly enhance the minimal pleading threshold under Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (To survive a motion to dismiss, a complaint need only allege a claim “that is plausible on its face.”).

After rejecting Geragos’ attempt to have the case remanded based on a finding that Geragos had fraudulently joined a defendant to avoid removal, the Judge proceeded to the Motion to Dismiss which raised three issues: (1) the effect of the Virus Exclusion in the Travelers’ Policy, (2) whether plaintiff failed to allege that the governmental orders prohibited access to its property, and (3) whether plaintiff could “‘plausibly allege that it suffered ‘direct physical loss or damage to property’ as required for civil authority coverage.’” Rather than address the effect of the exclusion, which would be the narrowest issue (this exclusion is not present in all policies), the Court proceeded directly to the third issue, which has the broadest potential application.

Reprinted courtesy of Scott P. DeVries, Hunton Andrews Kurth, Michael S. Levine, Hunton Andrews Kurth and Michael L. Huggins, Hunton Andrews Kurth

Mr. DeVries may be contacted at sdevries@HuntonAK.com
Mr. Levine may be contacted at mlevine@HuntonAK.com
Mr. Huggins may be contacted at mhuggins@HuntonAK.com


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The pollution exclusion has run amok in many states and has allowed insurers to avoid liability for otherwise covered claims.

Not Everything is a Pollutant: A Summary of Recent Cases Supporting a Common Sense and Narrow Interpretation of the CGL's Pollution Exclusion

Monday, October 26, 2020 — Philip B. Wilusz & Jeffrey J. Vita - Saxe Doernberger & Vita

Those of us who suffered through law school are familiar with the argument that there are fundamental rules applicable to contract interpretation and that a certain contract language interpretation would “swallow the rule.” However, insurance companies have long advocated for an interpretation of the CGL policy’s pollution exclusion that would “swallow the coverage” that the insureds thought they were purchasing. Insurers have successfully argued in several states that the pollution exclusion’s definition of “pollutant” should be read literally, and be applied to any “solid, liquid, gaseous, or thermal irritant or contaminant including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste.” As anyone with children can attest to, the range of items and substances that can be considered an “irritant” is limitless. The logical extent of the insurer’s interpretation brings to mind the high school student who, for his science fair project, convinced his fellow students to ban “dihydrogen monoxide.”1 Citing evidence such as the fact that everyone who has ever died was found to have consumed “dihydrogen monoxide,” he convinced them of the dangers of . . . water. Similarly, an overly expansive reading of the definition of “pollutant” could lead to the absurd result of even applying it to ubiquitous harmless substances such as water. The pollution exclusion, therefore, has run amok in many states and has allowed insurers to avoid liability for otherwise covered claims.

Fortunately, insureds in many states have successfully argued that the pollution exclusion is subject to a more limited interpretation based on several different theories. For example, some courts have agreed that the pollution exclusion, as initially introduced by the insurance industry, should be limited to instances of traditional environmental pollution. Others have held that the exclusion is ambiguous as to its interpretation. The reasonable expectations of the insureds do not support a broad reading of the defined term “pollutant.” Below, this article addresses a number of recent decisions that have adopted a pro policyholder interpretation of the pollution exclusion. As with most insurance coverage issues, choice of law clearly matters.

Reprinted courtesy of Philip B. Wilusz, Saxe Doernberger & Vita and Jeffrey J. Vita, Saxe Doernberger & Vita

Mr. Wilusz may be contacted at pbw@sdvlaw.com
Mr. Vita may be contacted at jjv@sdvlaw.com


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When delays are excusable, a contractor is entitled to a time extension, such that the government may not assess liquidated damages for those delays.

Contractor’s Burden When It Comes to Delay

Monday, October 26, 2020 — David Adelstein - Florida Construction Legal Updates

When a contractor is challenging the assessment of liquidated damages, or arguing that it is entitled to extended general conditions, the contractor bears a burden of proof to establish there were excusable delays that impacted the critical path and, in certain scenarios, the delays were not concurrent with contractor-caused delay:

When delays are excusable, a contractor is entitled to a time extension, such that the government may not assess liquidated damages for those delays. The government bears the initial burden of proving that the contractor failed to meet the contract completion date, and that the period of time for which the government assessed liquidated damages was correct. If the government makes such a showing, the burden shifts to the contractor to show that its failure to timely complete the work was excusable. To show an excusable delay, a contractor must show that the delay resulted from “unforeseeable causes beyond the control and without the fault or negligence of the Contractor.” “In addition, the unforeseeable cause must delay the overall contract completion; i.e., it must affect the critical path of performance.” Further, the contractor must show that there was no concurrent delay.

Ken Laster Co., ASBCA No. 61292, 2020 WL 5270322 (ASBCA 2020) (internal citations omitted).

Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.

Mr. Adelstein may be contacted at dma@kirwinnorris.com

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City says the reconstruction, new terminal project will continue.

Chicago Debt Document Says $8.5B O'Hare Revamp May Be Delayed

Monday, October 26, 2020 — Jeff Yoders - Engineering News-Record

The $8.5-billion revamp of O'Hare International Airport may have to be delayed because of COVID-19 related economic impacts, according to documents included in paperwork to refinance existing airport debt. The city forcefully disagreed with that summation, however, and says the project will move forward and is not endangered.

Reprinted courtesy of Jeff Yoders, Engineering News-Record

Mr. Yoders may be contacted at yodersj@enr.com

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A landmark fair labor standards act decision establishes due process review for employers.

Recent Federal Court Decision Favors Class Action Defendants

Monday, October 26, 2020 — Amber Karns & Dan Pipitone - Construction Executive

The commercial construction contracting and subcontracting industry in general is unique under the law for industry professionals, as they’re typically limited to wage and hour litigation under provisions of the Fair Labor Standards Act.

The majority of FLSA cases seek class action status or collective classification, while other FLSA litigation is initiated by individuals seeking damages. For the former, past and current employees can opt into class action litigation and seek collective damages against a construction company. The looming financial burden of class action or collective litigation against construction companies consume time, money and resources to the extent it’s often advisable for Defendants to negotiate an unfair settlement.

Yet, thanks to a recent federal court decision on March 27, 2020, the legal maneuvering behind unreasonable Plaintiff demands may soon be counter-balanced by the class action Defendants’ right to due process review. A recent legal opinion in a recent FLSA case has potentially wide-ranging implications for Defendant employers mired in future class action litigation. Moreover, as the FLSA applies to all employers, this decision potentially applies to all ownership groups representing the commercial construction industry, extending to partners, contractors and subcontractors.

Reprinted courtesy of Amber Karns & Dan Pipitone, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Mr. Pipitone may be contacted at dpipitone@munsch.com
Ms. Karns may be contacted at akarns@munsch.com


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Although some of these tips may sound like common sense, I often encounter situations where these basic rules are violated by experienced contractors, subcontractors, suppliers and design professionals.

Top Five General Tips for All Construction Contracts

Monday, October 26, 2020 — Christopher G. Hill - Construction Law Musings

For this week’s Guest Post Friday here at Musings we welcome Spencer Wiegard. Spencer is a Partner with Gentry Locke Rakes & Moore, LLP. He is a member of the firm’s Construction Law and Commercial Litigation practice groups. Spencer focuses his practice in the areas of construction law and construction litigation. Spencer is a member of the Board of Governors for the Virginia State Bar Construction Law and Public Contracts Section, and a member of the Legislative Committee of the Associated General Contractors of Virginia and the Executive Committee for the Roanoke/SW Virginia District of the Associated General Contractors of Virginia.

I would like to thank Chris for inviting me to author today’s guest post. Over the past few days, I have found myself wading through the terms and conditions of a lengthy and complicated construction contract, while at the same time aggressively negotiating for Houston house leveling cost readjustments. As I slogged through the legalese, I was reminded of a presentation that I gave earlier this year to the Roanoke District of the Virginia Associated General Contractors. The district’s executive committee asked me to speak to its members concerning the broad topic of “Construction Contracts 101.” At the beginning of my presentation, I passed along my top five general tips for all construction contracts. Although some of these tips may sound like common sense, I often encounter situations where these basic rules are violated by experienced contractors, subcontractors, suppliers and design professionals. My top five general tips for all construction contracts are:

  1. Reduce the terms of the agreement to writing.
    1. The written agreement should include all important and relevant information and terms. If it was important enough to discuss prior to signing the contract, it is important enough to include in the written contract;
    2. At a minimum, include who, what, when, where, how, and how much;
    3. Both parties should sign the written agreement; and
    4. Don’t ignore handwritten changes to the contract, as these changes may either mean that you don’t have a deal, or they may become part of the contract when you sign it.
Reprinted courtesy of The Law Office of Christopher G. Hill

Mr. Hill may be contacted at chrisghill@constructionlawva.com

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Gold five under spotlight

The pandemic has shown the world how vital the construction industry is.

My Top 5 Innovations for Greater Efficiency, Sustainability & Quality

Sunday, October 25, 2020 — Cristina Savian - AEC Business

As a construction professional and British citizen, I genuinely could not have been any prouder and humbled to have opened UK Construction Week Virtual last week.

2020 is the year of disruptions, and we are all looking for this “New Normal”, and while this newfound regularity may have opened new opportunities, as we are now broadcasting to a much wider audience than previous in-person events, and indeed we have to thank technology for that. For us construction professionals, this pandemic has put our industry further under pressure, however, it has also taught us something extremely important. The pandemic has shown the world how vital the construction industry is. The world cannot function without it. This new extraordinary experience has given us the prospect to turn our industry around and transform it into one of the most productive industries in our society.

How are we going to do it? I think you can guess what I am about to say, of course by leveraging technology! The panel discussion with leading construction experts across the UK with representatives from Skanska UK, Bryden Wood, and Innovate UK, focused on our top 5 innovations for greater efficiency, sustainability and quality in construction. Here are my top 5.

Reprinted courtesy of Cristina Savian, AEC Business
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A lawsuit backed by the National Apartment Association and other challenges aim to undo the national eviction moratorium ordered by the CDC.

Landlords Challenge U.S. Eviction Ban and Continue to Oust Renters

Sunday, October 25, 2020 — Kriston Capps - Bloomberg

In September, the Trump administration announced a national moratorium on evictions, via an order by the Centers for Disease Control and Prevention aimed at reducing the spread of coronavirus. The four-month temporary suspension applies to any tenant who can’t make rent due to economic conditions and who presents a written declaration about their circumstances to their landlord.

But the CDC ban now faces legal challenges on multiple fronts, even as landlords continue to routinely file evictions for nonpayment of rent — the very outcome that the order was designed to prevent.

On Oct. 20, the U.S. District Court for the Northern District of Georgia heard the first case against the moratorium, Richard Lee Brown, et al. v. Secretary Alex Azar, et al.. That challenge, brought by a nonprofit called the New Civil Liberties Alliance, has been joined by the National Apartment Association, which represents some 85,000 landlords responsible for 10 million rental units. Lawyers and scholars working on behalf of plaintiffs in the cases say that the CDC lacks the constitutional authority to enact a policy affecting rents.

Reprinted courtesy of Kriston Capps, Bloomberg
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The court noted cases in which courts had found physical loss even without tangible destruction to the covered property.

Texas Federal District Court Dismisses COVID-19 Claim

Sunday, October 25, 2020 — Tred R. Eyerly - Insurance Law Hawaii

Judge Ezra, formerly on the bench in Hawaii, dismissed a COVID-19 claim pursued by a Texas policy holder. Diesel Barbershop, LLC v. State Farm Lloyds, 2020 U.S. Dist. LEXIS 147276 (W.D. Texas Aug. 13, 2020).

Local and state officials in Texas issued shutdown orders in March 2020 due to the spread of the cornavirus. All non-essential businesses, including the insureds' barbershop businesses, were ordered closed from April 2, 2020 until April 30, 2020. The insureds submitted a claim for business interruption and civil authority coverage to their carrier, State Farm. The claim was denied based on the policy's exclusion for loss caused by enforcement of ordinance or law, virus, and consequential losses. For Civil Authority coverage, State Farm contended the policy required that there by physical damage within one mile of the described property and that the damage be the result of a Covered Cause of Loss, which, State Farm asserted, a virus was not.

The insureds sued and State Farm moved to dismiss. The court noted cases in which courts had found physical loss even without tangible destruction to the covered property. Yet, the court found that the line of cases requiring tangible injury to property were more persuasive. Therefore, the court found that the insureds failed to plead a direct physical loss.

Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

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