subcontractor Archives

Feb 21, 2017

Constructive Change: A Claim by Any Other Name

What should a contractor do when it and the owner’s representative dispute whether certain work requested by the owner is required by the drawings and specifications and the contract states that (1) the contractor waives its right to a change order by proceeding to perform a change without first obtaining a change order or directive signed by the owner’s representative, and (2) the contractor is obligated to continue performance of the work pending resolution of a disputed claim? If the contractor is right that the work is in addition to what is required by the drawing and specifications, the contractor… Read more

Jan 24, 2017

Is Your Company’s Drug Testing Policy Compliant with OSHA’s New Rules?

Authored by Darren Rowles and Scott Cahalan Occupational Safety & Health Administration (“OSHA”) requires that employers inform employees about how to report occupational injuries and illnesses.[1] OSHA recently updated its rules to clarify that the reporting method required by employers must include (1) a “reasonable procedure” for employees to report work-related injuries and illnesses, and (2) not discriminate or retaliate against employees who report such injuries or illnesses.[2] A procedure is unreasonable if it would deter or discourage a reasonable employee from accurately reporting a workplace injury or illness.[3] OSHA’s rationale for the new rules is to encourage employees to… Read more

Feb 20, 2015

CGL Policy Coverage for Rip and Tear Costs

General contractors are all too familiar with the limitations in a CGL policy relating to defective work. Those limitations exclude coverage for costs associated with damage caused by “your work.” There is a limited exception to the “your work” exclusion in some CGL policies that affords coverage for damage to other work caused by defective work performed by subcontractors (the “Subcontractor Exception”). Regardless, there is no coverage for the costs of correcting the defective work itself – only for damage to other work caused by the defective work. Water intrusion situations provide good examples of how this coverage works. A subcontractor’s… Read more

Jan 7, 2015

The Spearin Doctrine: Determining Who Bears the Construction Risk of Design Errors

All owners, contractors, and subcontractors should carefully negotiate contract clauses that govern their relationships. In addition, all construction participants should be aware of the many implied obligations in construction contracts. An implied obligation is one that is not expressly stated in a contract but implied, by courts, arbitration panels, and dispute review boards. One such implied obligation is the implied warranty of the adequacy of the plans and specifications, also known as the Spearin Doctrine. Before the turn of the 19th century, the law generally placed all construction risk on contractors, except in the event that their contract expressly stated… Read more

Nov 18, 2014

Georgia Lien Law: How much time do I really have to file a Lien Action?

In 2009, Georgia amended its lien statute. One of the many amendments to the statute requires lien claimants to include on the face of the lien the following statement in at least 12-point bold font: “This claim of lien expires and is void 395 days from the date of the filing of the claim of lien if no Notice of Commencement of Lien Action is filed in that time period.” (emphasis added). O.C.G.A. § 44-14-367. The failure to include this language in the claim of lien shall invalidate the lien and prevent it from being filed. Id. By now, most… Read more

Apr 17, 2014

Effective Immediately: Brand New Mississippi Lien Laws

In an earlier blog post, we discussed a Fifth Circuit Court of Appeals opinion, Noatex Corp. v. King Constr. of Houston, LLC, 732 F.3d 479 (5th Cir. 2013), which found Mississippi’s Stop Notice Statute unconstitutional. The ruling was particularly harsh because Mississippi did not allow subs and suppliers the right to record a lien. After the ruling, the only apparent recourse for subs and suppliers that had not been paid for work completed was to sue those with whom they had a contract for breach of contract. We questioned how the Fifth Circuit’s ruling would affect Mississippi’s lien laws. Now… Read more

Feb 26, 2014

Utility Interference Work in New York

Imagine you are a contractor that has decided to pursue work with the city. You are lucky enough to secure a lucrative contract to upgrade the city’s infrastructure, but you discover that certain other infrastructure owned by a private utility must be relocated to complete your work. Now imagine that the private utility refuses to relocate its infrastructure and refuses to enter into a contract to allow you to relocate the utility’s interfering infrastructure. The utility’s lack of cooperation is likely to cause significant and costly delays on your job with the city. What can you do? In Perfetto Contracting… Read more

Nov 11, 2013

Sovereign Immunity from a Surety’s Subrogation Claims? Not in Georgia

Authored by Darren Rowles and Scott Cahalan When a surety receives notice that its principal has defaulted, the surety is faced with a decision. Depending on the terms of the bond, the surety can either complete the work at its own expense, obtain bids from completion contractors and then arrange for them to contract directly with the owner or other obligee, allow the obligee to arrange for completion of the work with the costs to be paid by the surety, settle with the obligee, or it can choose to defend against the default and assert the principal’s claims, if any, against… Read more

Sep 18, 2013

Can You Arbitrate Where You Want To?

Authored by: Darren Rowles A forum selection clause is a contractual provision designating a certain state or court as the jurisdiction in which the parties will resolve disputes arising out of their contract. These clauses are very common in the construction industry. Just as common are agreements to arbitrate disputes arising out of the contract, which may also select where the dispute will be heard. If, for example, a Georgia company enters into contracts to perform work outside of the state, it might still want its contract to include a provision indicating that all disputes relating to the contract are… Read more