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Millennium Tower Fix Test Declared ‘Successful'
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This article provides an overview of no-damage-for-delay clauses and the exceptions to enforcement of these clauses.
No Damage for Delay? No Problem: Exceptions to the Enforceability of No Damage for Delay Clauses
Monday, October 18, 2021
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Chris Broughton, Jones Walker LLP - ConsensusDocs
Introduction:
Under a no-damage-for-delay clause, the owner is not liable for any monetary damages resulting from delays on the project. In lieu of monetary recovery, the contractor’s remaining remedy is a non-compensatory time extension. These clauses are common at the contractor-subcontractor interface as well.
While no-damage-for-delay clauses are enforced in most jurisdictions, some states, either by statute or case law, have limited the enforceability of no-damage-for-delay clauses. Other states have also limited the enforceability of these clauses on state government contracts, and a select few have outlawed them on all projects regardless if they are publicly or privately owned. Additionally, for subcontractors on federal projects, the Miller Act may provide a way to avoid no-damage-for-delay and recover against the general contractor’s payment bond.
This article provides an overview of no-damage-for-delay clauses and the exceptions to enforcement of these clauses. However, due to the consequences of a no-damage-for-delay clause, it is important to know the terms of your contract and the law that governs your project.
Reprinted courtesy of Chris Broughton, Jones Walker LLP
Mr. Broughton may be contacted at cbroughton@joneswalker.com
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The following recent cases highlight the potential waiver of privilege in light of the preparation of a forensic report.
Attorney-Client Privilege in the Age of Cyber Breaches
Monday, October 18, 2021
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Shaia Araghi - Newmeyer Dillion
Investigations and forensic reports relating to a cybersecurity breach may not always be protected by the attorney-client privilege or work product protection. Companies seeking such reports after a data breach must take caution to protect them from a possible waiver of privilege in the event of subsequent litigation relating to a data breach. The following recent cases highlight the potential waiver of privilege in light of the preparation of a forensic report.
- In re Capital One Consumer Data Security Breach Litigation, 2020 WL 3470261 (E.D. Va. June 25, 2020)
- After a data breach occurred, Capital One retained a law firm that later entered into an agreement with Mandiant for various cyber-related services (including incident remediation), which required that Mandiant provide deliverables to the firm, rather than to Capitol One. In re Capital One Consumer Data Security Breach Litigation, 2020 WL 2731238, at *1 (E.D. Va. June 25, 2020). Plaintiffs sought release of the report created by Mandiant (regarding the factors leading to the breach), arguing that it was prepared for business and regulatory purposes and therefore was not privileged, while Capital One argued that the report was privileged because it was prepared in anticipation of litigation. Ibid. The Court determined that Capital One did not carry its burden of establishing that the report was protected by the attorney work-product doctrine and ordered that Capital One produce the report. Id. at *7. In its reasoning, the Court stated that the fact that there is litigation does not, by itself, provide prepared materials with work-product protection. Ibid. The work-product protection applies when a party faces a claim following an event that may result in litigation, and the work product would not have been prepared in a substantially similar form but for the prospect of that litigation. Ibid.
Reprinted courtesy of Shaia Araghi, Newmeyer Dillion
Ms. Araghi may be contacted at shaia.araghi@ndlf.com
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This article aims the spotlight on five often overlooked aspects of construction contracts.
Five Frequently Overlooked Points of Construction Contracts
Monday, October 18, 2021
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Craig H. O'Neill - White and Williams LLP
There is no shortage of articles addressing the key points of construction contracts. Just enter that phrase into any internet search engine and you will find plenty. It should go without saying that a construction contract should be in writing, it should clearly identify the scope of work to be performed and the sums to be paid for that work, and it should address the parties’ rights and responsibilities with regard to termination or suspension of the contract, correcting defective work, and handling claims and disputes—just to name a few. Of course, these items should receive their due consideration. Too often, however, other important aspects of the construction contract get shortchanged. This article aims the spotlight on five often overlooked aspects of construction contracts.
Project Schedules
Surprisingly, many construction contracts pay little attention to a central component of any construction project: the project schedule. Many contracts provide the dates of commencement and substantial completion but not much else. With the frequent use of project management techniques such as the Critical Path Method (CPM) and the associated software, it is easier than ever to identify which tasks should be prioritized and identify potential areas of delay. The owner’s contract with the general contractor should clearly define the scheduling methods used and provide measures to keep the parties informed of the progress of the work. By including basic scheduling requirements in the contract documents—such as the submission of “Baseline Project Schedules” (consistent with the contract time provisions), “Schedule Progress Updates” (comparing the progress of the work against the Baseline Project Schedule), and “Schedule Recovery Plans” (when Schedule Project Updates indicate projected delays)—the parties can avoid or reduce disputes over project delays that often lead to litigation.
Reprinted courtesy of Craig H. O'Neill, White and Williams LLP
Mr. O'Neill may be contacted at oneillc@whiteandwilliams.com
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COVID-19 Pandemic: Is it Over Yet? Not so Fast!
October 18, 2021 — John P. Ahlers - Ahlers Cressman & Sleight
The COVID-19 Pandemic created a global disruption across trade, finance, health, education, businesses, and society in general like few others in the past 100 years. The pandemic’s fallout is being felt in the supply chain interruption experienced across all construction projects. This vulnerability, especially to an industry that has high dependence on China to fulfill its need for raw materials or finished products, has been exposed. China’s dominant role as the “world factory” means that any disruption to China puts global supply chains at risk. The impact to construction has manifested itself in rising prices of steel, other metals, PVC products, lumber, and a variety of other essential construction materials. The impact to the supply chain has shocked the construction industry and likely future measures will address the overdependence on foreign markets for construction supplies. News accounts are filled with COVID-19 mutations and virus strains that threaten further disruptions to the construction industry. Simply put, the pandemic is not over yet.
Viewpoint: Adjusting to the ‘Post-Truth’ Environment Driving Up Insurance Claims Costs
October 18, 2021 — Michael Germano - Engineering News-Record
Social Inflation is a term insurers are using to describe increasing insurance losses. It is fueled by societal instability and appeals to emotion and fear, which cause higher jury awards, larger settlements and the inevitable result—more litigation.
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3M Homeowner Survey Shows Strong Interest in Eco-friendly Construction Materials and Practices
October 18, 2021 — PR Newswire
ST. PAUL, Minn., Oct. 6, 2021 /PRNewswire/ -- From reducing air pollution to using renewable energy as a power source, U.S. homeowners have an overwhelming desire for more information, more choices, and more action across the industry for eco-friendly construction materials and practices, according to the 2021 3M Home Renovation Study.
The majority of homeowners surveyed – 74% – agree that using eco-friendly construction materials would make a strong impact to the environment, and 70% plan to purchase eco-friendly materials for their next renovation.
For more information on how 3M science can drive change for more sustainable home construction solutions, visit 3M smog-fighter. To read more about the Home Renovation Study, visit https://3m.com/homereno.
Upcoming “Bid Protests on Public Works Projects” CLE November 30, 2021
October 18, 2021 — Cameron Sheldon - Ahlers Cressman & Sleight PLLC
The Seminar Group, Inc. is hosting a CLE entitled “Bid Protests on Public Works Projects” in Seattle on November 30, 2021. The seminar will address the following topics:
- View from the Contractor v. View from the Owner;
- W/MBE & DBE Considerations;
- Sealed Bidding;
- Best Value Procurements and Award Disputes; and
- The Subcontractor Listing Law and Other Bid Protest Regulars.
The seminar is available in person (location TBD), live webcast, or on demand. We will update this blog when an in-person location is announced.
Ahlers Cressman & Sleight is excited to have one of its attorneys presenting at the seminar:
- Lindsay K. Watkins, a partner at ACS, will be presenting on W/MBE & DBE CONSIDERATIONS at 2:15 PM.
November 30th, 2021
Virtual & In-Person Event
Location TBD
Seattle, WA
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How do you determine damages for a breach of a construction contract?
Measure Of Damages for Breach of Construction Contract
Monday, October 18, 2021
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David Adelstein - Florida Construction Legal Updates
How do you determine damages for a breach of a construction contract? If you are interested in pursing a breach of a construction contract action, this is something you NEED TO KNOW!
The recent Fourth District Court of Appeal’s decision in Cano, Inc. v. Judet, 46 Fla. L. Weekly D2083b (Fla. 4th DCA 201) explains:
Where a contractor breaches a construction contract, and the owner sues for breach of contract and the cost to complete, the measure of damages is the difference between the contract price and the reasonable cost to perform the contract. See Grossman Holdings Ltd. v. Hourihan, 414 So. 2d 1037, 1039-40 (Fla. 1982). In Grossman, the supreme court adopted subsection 346(1)(a) of the Restatement (First) of Contracts (1932), which it concluded was “designed to restore the injured party to the condition he would have been in if the contract had been performed.” Id. at 1039. In other words, the owner will obtain the benefit of his bargain [and this is known as benefit of the bargain damages]. But where there is a total breach of the contract as opposed to a partial breach, an injured party may elect to treat the contract as void and seek damages that will restore him to the position that he was in prior to entering into the contract or the party may seek the benefit of his bargain. See McCray v. Murray, 423 So. 2d 559, 561 (Fla. 1st DCA 1982).
In Judet, an owner entered into a fixed price contract with a contractor to repair damage from a lightning strike. The contract amount was $300,000 payable in $30,000 installments. A few months after the contractor commenced performance, the owner terminated the contractor because the owner learned the contractor had not obtained required electrical and plumbing permits. At this time, the owner had paid the contractor $90,000. The contractor recorded a $40,000 lien for an amount it claimed it was owed and filed a lawsuit to foreclose its construction lien. The owner counter-sued the contractor to recover a claimed over-payment and a disgorgement of monies for unpermitted work. The owner was NOT claiming benefit of the bargain damages, but rather, damages for the contractor’s total breach “to restore him to the position that he was in prior to entering into the contract.”
Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com
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A general overview of the changes to the residential landlord tenant laws in Washington State and Seattle.
Updates to Residential Landlord Tenant Law
Monday, October 18, 2021
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Lawrence S. Glosser - Ahlers, Cressman & Sleight
Over the past several months, there have been major updates to the residential landlord tenant laws in Washington State and Seattle. There are also some remaining moratoria or eviction restrictions in Washington and Seattle. The following is a general overview of the changes.
Eviction Moratoria:
Washington State
Governor Inslee’s state-wide eviction moratorium technically ended on June 30, 2021. However, in late June 2021, Governor Inslee announced a “bridge” proclamation between the eviction moratorium and the housing stability programs put in place by the Washington State Legislature. The bridge is effective July 1 through September 30. The goal of the bridge period was to protect tenants from evictions for non-payment of rent to allow local governments to set up distribution programs for funds. More than $650 million of federal relief dollars allocated to assist renters was predicted to be available beginning in July. This is in addition to the $500 million previously released by the Department of Commerce to local governments for rental assistance and will help more than 80,000 landlords and renters. However, insofar as many localities have not established distribution protocols, the bridge period was instituted to allow time for those programs to be set up in various parts of the state.
Reprinted courtesy of Lawrence S. Glosser, Ahlers, Cressman & Sleight
Mr. Glosser may be contacted at larry.glosser@acslawyers.com
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There are key differences between routine document destruction (when done before receiving notice of potential claims or litigation) and spoliation.
The Difference Between Routine Document Destruction and Spoliation
Monday, October 18, 2021
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Steven A. Neeley - Construction Executive
In today’s world, there is a tendency to believe that everything must be preserved forever. The common belief is that documents, emails, text messages, etc. cannot be deleted because doing so may be viewed as spoliation (i.e., intentionally destroying relevant evidence). A party guilty of spoliation can be sanctioned, which can include an adverse inference that the lost information would have helped the other side. But that does not mean that contractors have to preserve every conceivable piece of information or data under all circumstances. There are key differences between routine document destruction (when done before receiving notice of potential claims or litigation) and spoliation.
The Armed Services Board of Contract Appeals decision in Appeal of Sungjee Constr. Co., Ltd., ASBCA Nos. 62002 and 62170 (Mar. 23, 2021) provides a good reminder. There, Sungjee challenged its default termination under a construction contract at Osan Air Base in South Korea. Sungjee argued that the government denied it access to the site for 352 days (out of a 450-day performance period) by refusing to issue passes that were needed to access the base. The government argued that it had issued the passes, but it could not produce them to Sungjee in discovery because they had been destroyed as part of a routine document destruction policy. The base security force issued hard copy passes and entered the information in a biometric system. The government was able to produce the biometric system data but not the hard copy passes because they were destroyed each year.
Sungjee argued the government was guilty of spoliation and moved for sanctions. It asked the Board to draw an adverse inference that the passes would have shown that the government had not issued proper passes on a timely basis, which delayed Sungjee’s performance. The Board denied Sungjee’s motion for several reasons.
Reprinted courtesy of Steven A. Neeley, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
Mr. Neeley may be contacted at steve.neeley@huschblackwell.com
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In Mendoza v. Fonseca McElroy Grinding Co., Inc., the California Supreme Court weighed in on whether prevailing wages must be paid on mobilization work involving transporting heavy machinery to and from a public works project.
California Supreme Court Holds that Prevailing Wages are Not Required for Mobilization Work, for Now
Monday, October 18, 2021
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Garret Murai - California Construction Law Blog
In the midst of the Great Depression the federal government enacted the Davis-Bacon Act (40 U.S.C. section 32141 et seq.) to help workers on federal construction projects. Under the Davis-Bacon Act, minimum wages must be paid to workers on federal public works projects based on local “prevailing” wages. At the time, the goal of the law was to help curb the displacement of families by employers who were recruiting lower-wage workers from outside local areas. A darker history suggests that it was also intended to discourage minority workers from competing with unionized white workers.
Fast forward to today. Many states, including California, adopted “Little Davis-Bacon” laws applying similar requirements on state and local public works projects. California’s prevailing wage law (Labor Code section 1720 et seq.) requires contractors on state and local public works projects pay their workers the general prevailing rate of per diem wages based on the classification or type of work performed by the employee in the locality where the project is located.
Over the years, labor unions have sought to expand the definition of what constitutes a “public works project” from private residential developments receiving public funding (generally, prevailing wages required) to off-site fabrication of materials at permanent facility for a public works project (no prevailing wages required) to enforcement mechanisms such as making a general contractor liable for prevailing wage violations of its subcontractors (yes, indeedy, see Labor Code section 1775).
Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com
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Super Lawyers, a Thomson Reuters business, is a rating service of lawyers from more than 70 practice areas, who have attained a high degree of peer recognition and professional achievement.
Traub Lieberman Attorneys Recognized as 2021 New York – Metro Super Lawyers®
Monday, October 18, 2021
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Traub Lieberman
Traub Lieberman is pleased to announce that six Partners from the Hawthorne, NY Office have been selected to the 2021 New York - Metro Super Lawyers list.
2021 New York – Metro Super Lawyers
Reprinted courtesy of Traub Lieberman
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Some key points to keep in mind regarding the new standard.
PSA: Virginia DOLI Amends COVID Workplace Standard
Monday, October 18, 2021
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Christopher G. Hill - Construction Law Musings
As the governmental response to COVID-19 evolves, so do the various standards that apply to employers. Effective September 8, 2021, the Virginia Department of Labor and Industry superseded its earlier permanent workplace standard with a new standard.
In many ways, the new standard simplifies compliance because it gets rid of what I believed to be overly confusing workplace classifications into risk levels and simply applies the new standard to all workplaces regardless of how they would have been classified. Some key points to keep in mind regarding the new standard are the following (with the recommendation that all employers read and understand the text of the standard):
- Masks: All unvaccinated employees must wear masks in all public, common, or shared workspaces with certain exceptions. These exceptions include when an employee is alone in a room/office, when eating, certain medical conditions, and where it is important that the mouth can be seen (such as communication with the deaf). Vaccinated employees need not mask up unless working in a high or substantially transmission area per the CDC Data Tracker.
- Vaccination Requirement: As of now, the DOLI does not require employee vaccinations. However, employers will need to have a way to determine vaccination status to comply with other parts of the standard.
Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com
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Miami Condo Collapse: Water Attacked Roof, Inside, Pool Deck
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HHMR is highly regarded for its expertise in construction law and the litigation of construction related claims, including the defense of large and complex construction defect matters.
HHMR Celebrates 20 Years of Service!
Monday, October 18, 2021
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David M. McLain – Colorado Construction Litigation
I remember it (almost) like it was yesterday. It was September of 2001, and I was a third-year associate at Long & Jaudon, practicing with the construction litigation group. After a long weekend away, I received word that the firm had just announced that it would cease providing legal services. Long & Jaudon, which formed in 1967, had been a stalwart of Colorado’s defense bar, counting among its number some of the finest and most well-respected defense attorneys in the state. To learn that the firm would be shutting its doors was devastating. I would be out of a job.
Soon after L&J’s announcement, Dave Higgins, one of that firm’s senior partners, inquired as to whether I would be interested in starting a new firm focused on supporting Colorado’s construction industry and its insurers. Instead of riding into the sunset of retirement, Dave wanted to leave a legacy. That legacy is Higgins, Hopkins, McLain & Roswell. Shortly after the sprout of the idea, I spent an afternoon at a picnic table in Cheesman Park with Dave Higgins, Steve Hopkins, and Sheri Roswell, sketching out an idea for a new law firm. Twenty years later, HHMR is still here, still serving Colorado’s construction industry and its insurers, and still embodying the principles of service and stewardship upon which the firm was founded.
Reprinted courtesy of David McLain, Higgins, Hopkins, McLain & Roswell
Mr. McLain may be contacted at mclain@hhmrlaw.com
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Real estate tokenization and smart home technology continue to grow, negotiations surrounding the bipartisan infrastructure bill stall its passing, artificial intelligence is poised to transform the construction industry, and more.
Real Estate & Construction News Round-Up (10/06/21)
Monday, October 18, 2021
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Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
Real estate tokenization and smart home technology continue to grow, negotiations surrounding the bipartisan infrastructure bill stall its passing, artificial intelligence is poised to transform the construction industry, and more.
- Contra Global leverages real estate tokenization, the process of creating tokens on the Blockchain and assigning them to real estate properties that already exist or are under construction, to remove traditionally high barriers to investment entry as well as intermediary fees in the industry. (Navid Ladani, Yahoo Finance)
- Following the 2-week closure of the construction industry after protests turned violent over vaccine mandates, the Victorian government announced its reopening with up to 25 percent capacity of workers and new vaccination rules. (ABC News)
- Though the construction industry has traditionally relied heavily on human experience and expertise to complete projects, the industry is rapidly adopting digital solutions to adapt to chronic labor shortages, the need for sustainable solutions, and supply-chain disruptions. (Tom Taulli, Forbes)
Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team
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The First Street report comes as Congress is debating whether to put trillions of dollars toward rebuilding aging infrastructure—and making it more resistant to extreme weather and flooding being exacerbated by climate change.
Flood-Threat Assessment Finds Danger Goes Far Beyond U.S. Homes
Monday, October 18, 2021
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Leslie Kaufman, Rachael Dottle & Mira Rojanasakul - Bloomberg
If the floods don’t get you, lack of electricity or a swamped hospital might.
Nearly a quarter of U.S. critical infrastructure—utilities, airports, police stations and more—is at risk of being inundated by flooding, according to a new report by First Street Foundation, a Brooklyn nonprofit dedicated to making climate risk more visible to the public.
Around 25% of national critical infrastructure is at risk.
Roughly 14% of Americans’ properties face direct risk from major storms, but the study shows danger extends far from those property lines.
Reprinted courtesy of Leslie Kaufman, Bloomberg, Rachael Dottle, Bloomberg and Mira Rojanasakul, Bloomberg
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EEOC complaint claims that Black laborers at the contractor's Google data center worksite in Clarksville, Tenn., were harassed because of their race, and that some were fired after they complained.
EEOC Sues Whiting-Turner Over Black Worker Treatment at Tennessee Google Project
Monday, October 18, 2021
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James Leggate - Engineering News-Record
The Whiting-Turner Contracting Co., which ranks as one of the industry’s largest contractors, has been accused in a federal civil rights lawsuit of creating a racially hostile work environment at a Tennessee project site and of retaliating against employees who complained.
Reprinted courtesy of James Leggate, Engineering News-Record
Mr. Leggate may be contacted at https://www.enr.com/leggatej@enr.com
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