Construction project schedules often generate disputes between project owners and contractors. These disputes commonly become the subject of claims that assign fault for delayed project completion to one party or another. When delays occur and float is available, each party may assume entitlement to the float on the project schedule and subsequent exemption from liability for damages relating to its delay; however, merely assuming float ownership can lead to unfavourable outcomes.
If a trade contractor submits a bid that a general contractor relies on to win a contract, questions may arise as to whether that bid is a contract and whether it is binding. Even if the bid does not meet the elements of a contract, it can still be binding. The courts apply the doctrine of promissory estoppel to hold parties to their bids in the absence of a contract. Differences in jurisdiction and in the facts of each case may affect the outcome, but when a bid is submitted it should be assumed to be binding.
Underground utilities and pipelines pose potential problems for excavators and other contractors performing work below ground. Whether a business involves the construction of buildings primarily above ground or running pipes or cables below, there are issues to consider where a construction involves excavations. Ultimately, excavators must use care to avoid damaging marked lines and take all reasonable steps to protect underground facilities, pipelines and on-site people from harm.
The 13th Court of Appeals in Edinburg, Texas recently issued an opinion that could eliminate the statutory employer protection for general contractors in certain circumstances if allowed to stand. The court held that in order to avail itself of the statutory employer defence, a general contractor must do something more than pass the onus of obtaining workers compensation coverage to its subcontractor. General contractors may need to rethink how they provide for workers' compensation coverage in future.
Pennsylvania's intermediate appellate court has affirmed a defence verdict for the design and construction manager of a major league baseball stadium. The court issued its ruling following extensive discovery and motions practice, a six-week bench trial in 2010 and two defence verdicts. The case has a number of key takeaways for complex, multi-party cases.
Proving waiver of a party's contractual right to arbitrate has often been a laborious obligation of the party bearing such burden. In the case between Legoland and Superior Builders, the court of appeals concluded that Legoland's actions in Superior's suit did not substantially invoke the judicial process; therefore, Superior failed to carry its heavy burden to show that Legoland had waived its contractual right to arbitrate. Accordingly, the court compelled the parties' dispute to arbitration pursuant to their arbitration agreement.
Construction delay claims are regarded as being among the most difficult types of claim in the industry, due in large part to the difficulty in analysing the home office overhead costs associated with a specific project in conjunction with the percentage of the total amount of these costs for the company. It is important for a contractor to select a recognised methodology for calculating allocable home office overhead costs and ensure that all elements tied to such damages methodology are satisfied.
Anyone watching what has happened recently in Houston and Florida will immediately think about the safety and wellbeing of those affected by Hurricanes Harvey and Irma. Once the aftermath of destruction is assessed, both areas and their residents will be looking at a long road to recovery. Among the many coming challenges, owners and contractors of existing projects must take steps to assess the effects and identify their contractual rights and obligations.
The construction industry has long accepted that the New York scaffold law imposes strict liability on construction contractors and property owners for injuries suffered by workers who fall or are hit by a falling object as a result of inadequate scaffolding or similar construction structures. A recent decision by the New York Court of Appeals indicates that this common understanding is wrong.
The Third Circuit Court of Appeals recently filed an opinion regarding whether the filing of a mechanic's lien after the commencement of a bankruptcy case violated the automatic stay. Given the frequent involvement of many companies in Delaware bankruptcy cases, the Third Circuit's ruling is important.
The economic loss doctrine is widely misunderstood and often misapplied. At its most basic, the premise of the doctrine is that a party cannot recover purely economic losses in a tort action. While simple in theory, the economic loss doctrine has suffered from wide variations in application – for example, states are split about whether the economic loss doctrine bars third-party claims against design professionals.
In a recent decision, the Seventh Circuit joined the Eighth, Ninth and Tenth Circuits in holding that the federal disadvantaged business enterprise (DBE) programme is constitutional on its face because it serves the compelling government interest in remedying a history of discrimination in highway construction contracting. With four appellate courts approving of the constitutionality of this federal DBE programme, should non-DBE specialty subcontractors be worried?
Given the critical role of written documentation in resolving construction claims – whether inside or outside of the courtroom – it is essential that companies adequately train the individuals who create written documentation. Companies should also be aware of the best practices for generating and preserving construction records to avoid evidentiary challenges to company records if a construction claim is litigated.
A recent decision of the New York Supreme Court Appellate Division, First Department highlights that a party seeking coverage as an additional insured by virtue of a provision in a construction contract must carefully review both the contract and the insurance policies at issue to make sure that they work together to provide the coverage sought.
The use of mobile phones on construction sites can pose significant safety hazards, which are proving of considerable interest to the Occupational Safety and Health Administration (OSHA), law enforcement, insurers and potential civil litigants. As OSHA's enforcement in this regard is expected to have a significant effect on law enforcement, employers in the construction industry should take care to reduce their potential civil and criminal liabilities.
Under the Occupational Safety and Health Administration (OSHA), multi-employer worksites have come under increased scrutiny, particularly in the construction industry. OSHA will likely continue to enforce compliance with worksite safety and health laws and regulations more forcefully, and the newly invigorated multi-employer worksite policy will be another tool that OSHA employs in its mission.
Construction contractors working under government contracts need to understand the complexities of the claims process under the Contract Disputes Act. A slew of recently decided cases have placed limitations on the landmark Maropakis decision, which illustrated the strict compliance requirements of the act. This confusing and evolving area is full of risk for the unwary government contractor.
California has expanded the definition of public works requiring the payment of prevailing wages to include the hauling or delivery of ready-mixed concrete for a public works project. The law blurs the distinction between contractors and suppliers and attempts to expand the number of employees who are entitled to prevailing wages, which are generally higher than regular wages.
While few construction disputes are heard in Delaware, there are some considerations that litigators must bear in mind, including the fact that because many construction lawsuits involve contract claims only, they will likely be heard in Delaware Superior Court. Further, if the dispute exceeds $1 million, it will be adjudicated before a judge assigned to the Complex Commercial Litigation Division, which was designed to streamline commercial litigation in the Delaware Superior Court.
The primary goal for employers at construction worksites – as well as at industry worksites in general – is to protect the health and safety of the workforce. To this end, the Occupational Safety and Health Administration regulates a variety of workplace safety concerns in both the public and private sectors. One of the most complex and heavily regulated areas of concern is confined spaces.