IRMI Construction Risk Conference

August 3, 2022
Beverley BevenFlorez – CDJ Staff

The International Risk Management Institute’s (IRMI) Construction Risk Conference will be returning this fall to Las Vegas, Nevada. Attendees will “experience top-tier speakers, focused construction risk and insurance content, and innovative ideas for contractor insurance programs.” The Gary E. Bird Horizon Award, Bill McIntyre Leadership Award, and the Words of Wisdom Award will be presented during the conference. The event is relevant for Contractors and Subcontractors, Project Owners, Architects and Engineers, Insurance Companies, Insurance Agents and Brokers, Consultants, Attorneys, and Independent Adjusters.

November 13th-16th, 2022
The Cosmopolitan of Las Vegas
3708 Las Vegas Blvd. S.
Las Vegas, NV 89109


Nomos LLP Partner Garret Murai Recognized by Super Lawyers

Gold star on sand

This is the ninth consecutive year that Mr. Murai has been recognized by Super Lawyers.

August 3, 2022
Garret Murai - California Construction Law Blog

Nomos LLP Partner Garret Murai has been recognized as a 2022 Northern California Super Lawyers honoree in the area of Construction Litigation. This is the ninth consecutive year that he has been recognized by Super Lawyers.

Super Lawyers, an annual listing of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and personal achievement, is limited to no more than five percent (5%) of lawyers in a state who are selected through a multiphase process that includes a statewide survey of lawyers, independent research evaluation and peer reviews by practice area.

Mr. Murai may be contacted at gmurai@nomosllp.com


Lower Your Home’s Fire Risk (and Insurance) With These Steps

August 3, 2022
Leslie Kaufman - Bloomberg

Homeowners in the US got new guidance today to help them defend against increasingly frequent wildfires and associated rising insurance premiums.

The Insurance Institute for Business & Home Safety, a research nonprofit funded by insurers, announced it has developed the first ever standard that can demonstrably lower a home’s risk of wildfire damage. To earn the Wildfire Prepared Home designation, homeowners have to meet a series of criteria — including, for example, clearing anything flammable like shrubs five feet around their homes — and pass an annual inspection.


Military Veterans Bring Safety, Leadership and Career Ambition to Construction

August 3, 2022
Dale L. Crawford - Construction Executive

Military veterans have invaluable skills that position them well for careers in construction. Veterans have great leadership and teamwork skills, sometimes with actual hands-on experience, as there are many engineering and electronic roles in the military. Veterans also respect hierarchy and have excellent communication skills that help inspire their teams to reach common goals. Military veterans are an invaluable asset to the construction industry. However, veterans of construction should also be commended for their commitment to training those who have come after them and will succeed them.

Reprinted courtesy of Dale L. Crawford, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.


Effective July 1, 2022, Contractors Will be Liable for their Subcontractor’s Failure to Pay its Employees’ Wages and Benefits

Construction worker looking at laptop and plans

Illinois Governor J.B. Pritzker signed two House Bills that amend the Illinois Wage Payment & Collections Act, 820 ILCS 115 et. seq.

July 25, 2022
Edward O. Pacer & David J. Scriven-Young - Peckar & Abramson

On June 10, 2022, 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 to attorneys’ fees and costs that are incurred by the employee in bringing an action under the Wage Act.

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 and David J. Scriven-Young, Peckar & Abramson
Mr. Pacer may be contacted at epacer@pecklaw.com
Mr. Scriven-Young may be contacted at dscriven-young@pecklaw.com


‘We Need More People’: Trudeau Lacks Workers for His Housing Fix

July 25, 2022
Ari Altstedter - Bloomberg

One of Canada’s biggest real estate developers warned that a lack of skilled workers threatens to derail the country’s effort to tackle its housing affordability crisis.

“We can’t build any more than we built in the last few years,” Michael Cooper, president of Dream Unlimited Corp., a Toronto-based real estate company, said of Canada’s housing industry. “If you want to have more units, we need more people to build.”


John Boyden, Alison Kertis Named “Top Rank Attorneys” by Nevada Business Magazine

Business partners raising arms in triumph

Formerly known as "Legal Elite," this annual list represents the top talent in the legal industry across the State of Nevada.

July 25, 2022
John Boyden & Alison Kertis - Lewis Brisbois

Reno, Nev. (June 16, 2022) – Reno Partner John Boyden and Associate Alison Kertis were recently named to Nevada Business Magazine's 2022 list of "Top Rank Attorneys." Formerly known as "Legal Elite," this annual list represents the top talent in the legal industry across the State of Nevada.

According to Nevada Business Magazine, thousands of attorneys are nominated for the list and then scored based on the number and type of votes they receive, with votes from outside an attorney's firm receiving more weight. Finally, before being added to the list, the attorneys, and the votes they receive, go through several levels of verification and scrutiny, with each ballot individually reviewed for eligibility and every voting attorney verified with the State Bar of Nevada. The magazine has published this list for the past 15 years.

Reprinted courtesy of John Boyden, Lewis Brisbois and Alison Kertis, Lewis Brisbois
Mr. Boyden may be contacted at John.Boyden@lewisbrisbois.com
Ms. Kertis may be contacted at Alison.Kertis@lewisbrisbois.com


Wildfire Insurance Coverage Series, Part 5: Valuation of Loss, Sublimits, and Amount of Potential Recovery

Flames

Policyholders need to take a close look at the policy’s terms to select the right type and amount of coverage for a potential loss.

July 25, 2022
Scott P. DeVries & Yosef Itkin - Hunton Insurance Recovery Blog

Insurance policies provide different levels of insurance coverage and even if the amount purchased was adequate at one time, developments over time (e.g., inflation, upgrades, regulatory changes and surge pricing) may leave the policyholder underinsured. In this post in the Blog’s Wildfire Insurance Coverage Series, we emphasize the need for policyholders to take a close look at the policy’s terms to select the right type and amount of coverage for a potential loss.

Various types of coverage are available and there has been extensive litigation concerning the amount of coverage provided by one policy form or another. For example, the policyholder may have purchased market value coverage (the value of the house at the time of the wildfire), replacement coverage subject to a policy limits cap, guaranteed replacement cost coverage, or some variation on the theme. While the property may be properly valued when the insurance is purchased, it may become undervalued at the time of loss due to factors like inflation or home improvements that were not disclosed to the insurer. And, however generous the limits may be when the policy is procured, as one court discussed, it may be insufficient when “surge pricing” occurs after a wildfire.[1]

Reprinted courtesy of Scott P. DeVries, Hunton Andrews Kurth and Yosef Itkin, Hunton Andrews Kurth
Mr. DeVries may be contacted at sdevries@HuntonAK.com
Mr. Itkin may be contacted at yitkin@HuntonAK.com


Pennsylvania Federal Court Finds No Coverage For Hacking Claim Under E&O Policy

Businessman pointing at red digital lock

Attorneys Celestine Montague and Paul A. Briganti discuss Construction Fin. Admin. Servs., Inc. v. Federal Ins. Co.

July 25, 2022
Celestine Montague & Paul A. Briganti - White and Williams LLP

On June 9, 2022, the U.S. District Court for the Eastern District of Pennsylvania held, on summary judgment, that an insured was not entitled to coverage under a Professional Errors and Omissions (E&O) policy for loss allegedly resulting from a hacking incident. See Construction Fin. Admin. Servs., Inc. v. Federal Ins. Co., No. 19-0020, 2022 U.S. Dist. LEXIS 103042 (E.D. Pa. June 9, 2022). Applying North Carolina and Pennsylvania law, the court reasoned that: (1) coverage was barred by the policy’s unauthorized computer access, or “breach,” exclusions; and (2) the insured violated a condition in the policy that required the insurer’s consent to settlements and the violation prejudiced the insurer.

The insured, Construction Financial Administration Services, Inc. (CFAS), was a third-party fund administrator for construction contractors. In April 2018, the CFAS received email requests from what it believed to be one of its clients, SWF Constructors (SWF), to disburse $1.3 million from an SWF account to a foreign company. CFAS authorized the payments, despite not having received a copy of any executed agreement between SWF and the foreign company. After the funds were disbursed, SWF advised that it had not authorized or requested the payments to the foreign company. In response, CFAS placed approximately $1.2 million of recovered and borrowed funds into the SWF disbursement account. SWF then sent a letter advising CFAS that the requests from the foreign company did not include documentation required under the contract between SWF and CFAS. It was later determined that the emails had been initiated by a fraudster who had gained unauthorized access to the sender’s email account.

Reprinted courtesy of Celestine Montague, White and Williams LLP and Paul A. Briganti, White and Williams LLP
Ms. Montague may be contacted at montaguec@whiteandwilliams.com
Mr. Briganti may be contacted at brigantip@whiteandwilliams.com


Elon Musk's Boring Co. Is Feuding With Texas Over a Driveway

Coworkers punching each other

Another corner of Musk’s empire is pushing the boundaries of regulation.

July 25, 2022
Sarah McBride - Bloomberg

While Elon Musk is publicly making a big deal about moving to Texas and cozying up to the governor, behind the scenes his tunnel-building venture, Boring Co., is wrangling with local authorities in the state over a host of seemingly mundane permitting issues.

Since Boring bought land last May to create a research and development center in Bastrop, Texas, a rural area outside Austin, the company has put workers up on mobile homes at the site without authorized sewage facilities, failed to get air and stormwater permits and built a driveway without first getting official approval, according to documents obtained by Bloomberg News through a public records request.

The company’s dealings with Bastrop are yet another illustration of how Musk’s businesses often push the boundaries of or simply ignore regulations that bind other companies. In recent years his Tesla Inc. restarted production at its Fremont plant in defiance of pandemic rules to stay closed, Boring tried to build a tunnel in Los Angeles without going through an environmental review process and the US Securities and Exchange Commission is examining the disclosure of Musk’s stake in Twitter Inc.


Fewer NYC Construction Deaths as Safety Law Awaits Governor's Signature

Two construction workers posing

Contractors seek changes before final approval.

July 25, 2022
Richard Korman - Engineering News-Record

The hoped-for progress in New York City construction safety is coming too late for laborer Jose Fortina Armenta Hernandez. At 8:37 a.m. on May 27, 2021, while jackhammering a roof section on a Brooklyn building, the section on which Armenta stood gave way and he fell 60 ft. When last year his family sent his body from New York City to Mexico to be buried, they used a GoFundMe page to raise money for the laborer's funeral.

Reprinted courtesy of Richard Korman, Engineering News-Record

Mr. Korman may be contacted at kormanr@enr.com

Read the full story...


Buy Clean California Act Takes Effect on July 1, 2022

California palm trees over sunset

Effective July 1, 2022, successful bidders on certain state projects will be required to submit an EPD identifying the product’s environmental impact over its life cycle.

July 25, 2022
Garret Murai - California Construction Law Blog

The Buy Clean California Act (BCCA) – Public Contract Code section 3500 et seq. – requires state agencies to consider the carbon content of the following products when awarding contracts:

  • Structural steel;
  • Concrete reinforcing steel;
  • Flat glass; and
  • Mineral wool board insulation.

It is anticipated that additional products may be added through future legislation.

Mr. Murai may be contacted at gmurai@nomosllp.com


Insurer Has Duty to Defend Sub-Contractor

Businessman holding umbrella challenging storm in urban environment

Attorney Tred R. Eyerly analyzes County Wide Mech. Servs. LLC v. Regent Ins. Co.

July 25, 2022
Tred R. Eyerly - Insurance Law Hawaii

Interpreting Connecticut law, the federal district court had that the insured sub-contractor was entitled to a defense. County Wide Mech. Servs. LLC v. Regent Ins. Co., 2022 U.S. Dist. LEXIS 86726 (D. Conn. May 13, 2022).

The underlying plaintiff, The Saybrook at Haddam, entered a contract with PAC Group to serve as general contractor for construction of an addition to The Saybrook's facility. PAC Group sub-contracted with County Wide Mechanical Services to install the HVAC system.

The HVAC system was put into service on November 14, 2014. In October 2019, The Saybrook filed the underlying action against PAC group, County Wide, and others. The underlying complaint alleged that there had been at least seven "critical failures" of the HVAC system. As a result, The Seabrook had to replace multiple compressors and several circuit boards, valves, and other components. Further, the entire system had to be replaced. The underlying complaint alleged breach of contract against PAC Group and County Wide. In addition to the alleged breach of contract between The Saybrook and County Wide, the Saybrook also alleged it was a third-party beneficiary of PAC Group's contract with County Wide regarding installation of the HVAC system. PAC Group cross-claimed against County Wide, asserting one count of contractual indemnification and one count of breach of contract under the PAC Group's contract with County Wide.

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


Infrastructure Money Comes With Labor Law Strings Attached

Dollar sign over dark sky

Contractors must be prepared to comply with special requirements.

July 25, 2022
Cheryl Behymer, Patrick M. Dalin & Collin Cook - Construction Executive

The federal government has committed to spending $1 trillion under the Infrastructure Investment and Jobs Act on nationwide construction, alteration and repair projects. Billions of dollars have already been deployed on projects to improve highways, bridges, airports, electrical infrastructure and drinking water distribution, and the government is poised to spend the remaining funds on a massive infrastructure build-out over the next five years. While federal government contracts may provide a lucrative and reliable stream of revenue for construction companies, contractors must be prepared to comply with special requirements, particularly under the labor and employment laws enforced by the U.S. Department of Labor (USDOL).

1. The Davis Bacon Act Requires Payment of Prevailing Wages and Fringe Benefits
The Davis Bacon Act (DBA) applies to most federally funded and federally assisted projects for construction, alteration or repair work. This law requires all contractors and subcontractors on a covered project to pay all “laborers or mechanics” the wages and fringe benefits that “prevail” in the locality where the work is being performed. The USDOL determines what the prevailing wages and fringe benefits are for each trade and publishes them in wage determinations that should be issued to all contractors on the project.

Reprinted courtesy of Cheryl Behymer, Patrick M. Dalin & Collin Cook, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.


May Heat Wave Deaths Prompt New Cooling Rules in Chicago

Man helping woman with heatstroke

The discovery of victim's bodies after a brief heat wave this month has raised questions about whether Chicago and the country are ready for a brutal heat wave.

July 25, 2022
The Associated Press (Don Babwin) - Bloomberg

Chicago (AP) -- A month after three women were found dead inside their stifling hot apartments at a Chicago senior housing facility, the City Council on Wednesday passed new cooling requirements for residential buildings.

Under the rules approved by the Council's Zoning Committee on Tuesday and the full Council on Wednesday, any new construction of senior facilities and larger residential buildings must include permanent air conditioning, giving them the same requirements already in place for nursing homes.

Any time the heat index climbs above 80 degrees, those buildings must run their air conditioning systems. Existing housing for older people can use portable cooling and dehumidification until May 2024, when they will be required to have permanent equipment installed.


BWB&O’s Los Angeles Office Obtains Major Victory in Arbitration!

Businessman facing a storm

The Arbitrator found for BWB&O’s client on every single issue and awarded $0 to homeowner on his Arbitration claim.

July 25, 2022
Dolores Montoya - Bremer Whyte Brown & O'Meara LLP

Bremer Whyte Brown & O’Meara Partner Patrick Au and Senior Associate Theresa Mallen recently achieved a major victory in binding Arbitration.

The subject action involved a construction project in the backyard of homeowner’s residence. Homeowner maintained that BWB&O’s contractor client abandoned the project. Furthermore, homeowner alleged that the work performed by BWB&O’s client was deficient. The primary construction defect claim is that the pool deck is not properly sloped which is preventing surface water from running off the top of the retaining wall as designed.

The Arbitrator ultimately sided with BWB&O’s client finding that BWB&O’s client did not abandon the project, but rather was terminated by homeowner. Additionally, BWB&O successfully proved that despite the fact that the three pertinent elevations that determine the slope of the concrete pool slab were pre-established before BWB&O’s client even got on the project, that BWB&O’s client properly installed the concrete pool slab and would have established the necessary slope of the pool deck had it not been terminated from the project. Homeowner asserted many other secondary construction defect claims and the Arbitrator found in BWB&O’s client’s favor on each and every issue.


Construction Law in Georgia

July 25, 2022
Beverley BevenFlorez – CDJ Staff

This one-day event produced by The Seminar Group “will discuss the prosecution and defense of construction related claims, how to protect the rights of your client, and your company’s right to receive payment.” Attendees will “hear from attorneys and other professionals regarding recent trends and issues facing the construction industry.” Examples of topics to be covered include Lien Law and Waiver Consideration, Key Concepts and Issues in Drafting and Negotiating Construction Agreements, and How to Successfully Prosecute a Construction Claim.

October 11th, 2022
In Person & Virtual Event
Location TBD


Federal District Court Submits Certified Question to Maryland Court of Appeals on COVID-19 Claim

July 25, 2022
Tred R. Eyerly - Insurance Law Hawaii

In an unusual move for a federal district court handling COVID-19 claims, a certified question was submitted to the Maryland Court of Appeals for an interpretation of state law. Tapestry, Inc. v. Factor Mut. Ins. Co., 2022 U.S. Dist. LEXIS 75665 (D. Md. April 25, 2022).

Tapestry owned three luxury accessory lifestyle brands: Coach, kate spade new york, and Stuart Weitzman. Before the pandemic, Tapestry had 1540 retail and outlet stores under its three brands, with 414 stores in the United States. Tapestry employed approximately 16,000 people across the United States.

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


Thank U.S. Military Veterans by Hiring Them for Construction Jobs

July 25, 2022
Zachary L Green - Construction Executive

The American construction marketplace has confronted numerous challenges over the past few years. In addition to disruptions and the renewed call for safety precautions based on COVID-19, construction firms nationwide have been besieged by material shortages, rising costs and widespread labor issues.

And even though the industry is projected to grow by 8.8% in 2022, the same problems are expected to persist well into the near future. In fact, NCCER recently confirmed the “finding and hiring of skilled workers” is still one of the industry’s greatest challenges. However, the organization also noted that the problem has accompanied “the unique opportunity to refurbish” and “emerge stronger than before.” This includes “building cultures that attract long-term talent,” “making the industry a great place for young workers to shine,” reinforcing the value of continued learning programs and helping workers find “dream positions” that “leverage better opportunities.”

Reprinted courtesy of Zachary L Green, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.


What I Love and Hate About Updating My Contracts From an Owners’ Perspective

Laptop next to agreement with pen and glasses

ConsensusDocs’ Executive Director & Senior Counsel Brian Perlberg spoke on a panel with Joe Cleves of Taft Law and Pen Wolf from the Cleveland Clinic.

July 25, 2022
ConsensusDocs

The Construction Owners Association of America (COAA) is the largest association of construction owners in the United States. COAA just held its Spring Connect conference in downtown Baltimore on the University of Maryland, Baltimore (UMB) campus. One session featured “What I Love and Hate About Updating My Contracts from an Owners’ Perspective.” ConsensusDocs’ Executive Director & Senior Counsel Brian Perlberg spoke on a panel with Joe Cleves of Taft Law and Pen Wolf from the Cleveland Clinic.

Pen Wolf from Cleveland Clinic outlined the process he used to update his contracts recently. The Cleveland Clinic builds facilities annually and owns different facilities at different locations. The clinic employs over 75,000 employees. For an owner with a broad reach like the Cleveland Clinic, Wolf recommended using outside counsel with construction expertise to update contracts. He concluded that while it was a significant effort, the endeavor to update the Clinic’s contracts was absolutely worth the time commitment and expense. Wolf shared that updating the Clinic’s contracts has generated positive reviews internally and externally. Now their written agreements better reflect their business practices in their construction design and construction program.



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