Keep An Eye On This Major Seattle Project
On January 6, 2011, the Washington State Department of Transportation (WSDOT) signed a contract with Seattle Tunnel Partners for the biggest piece of the SR 99 Viaduct replacement project, the 1.7 mile long tunnel carrying traffic from the south end of the Seattle waterfront to near the Seattle Center. This is a design-build contract with an estimated value of about $1.35 billion.
The SR 99 viaduct was built in the 1950s and concerns have been expressed about its ability to survive a major earthquake, in part because its foundations rest in part on fill materials that may liquefy in such an event. After studying various options, WSDOT has decided to replace the viaduct with a bored tunnel, which will require the use of one of the largest tunnel boring machines ever built. The SR 99 replacement project has many other parts, some of which are already in the preliminary phases of construction.
The WSDOT website has lots of interesting information about the project, including video simulations of how the existing viaduct and nearby seawall might collapse during a major earthquake and how it will look to drive through the completed tunnel.
Owners and developers: keep your eye on Section 106 compliance
A recent federal court decision underscores how a federal agency’s failure to comply with Section 106 of the National Historic Preservation Act can impact construction projects.
Section 106 is a procedural statute that requires each federal agency to take into account the effect of its “undertakings” on properties listed on or eligible for listing on the National Register of Historic Places. “Undertakings” include federally funded or federally permitted private projects.
In this case, the district court granted a preliminary injunction that suspended construction on a 700+ megawatt solar project in California. The court found that the BLM, by not adequately consulting with a tribe on the project, failed to comply with Section 106.
The case is a good reminder that owners and developers should monitor the permitting or funding agency’s approach to Section 106, because the agency’s lack of compliance can derail your project.
Have You Updated Your Mechanic's Lien Procedures in California?
Now that the holiday frenzy has wound down, many have overlooked the necessity of updating their mechanic’s lien procedures in California. Effective January 1, 2011, prevailing California law imposes new requirements and notice procedures for effective lien actions on mechanic’s lien claimants. These changes immediately affect the preparation, service, and recordation of mechanic’s lien claims. California Civil Code § 3084(a)(6)-(7) will mandate that a valid claim of lien, also known as a mechanic’s lien, must contain the following information in addition to what the law currently prescribes:
• Particular language in 10-point boldface type entitled “Notice of Mechanic’s Lien” as set forth precisely in the statute, and
• Affidavit of proof of service on the owner or reputed owner (and construction lender or original contractor in some cases, but best practices suggest that providing notice to all categories may provide an increased opportunity for payment).
If you have been using old forms, or even current commercially prepared forms, you should verify that they will not be outdated come January 1. The law makes clear that a failure to meet the requirements would cause the mechanic’s lien to be unenforceable as a matter of law. Your counsel should make certain that any preprinted form or custom form captures the new requirements of the Civil Code.
Further, the amendments affect the recordation of a lis pendens for a suit to foreclose a mechanic’s lien. The filing, which was previously performed as “good practice,” is legally mandatory beginning January 1, 2011 under Civil Code § 3146. The lis pendens must be recorded within 20 days after filing of the foreclosure action, and best practices dictate that counsel should record it immediately after the action is filed to preserve priority. You can find the legislation here.
Oregon Supreme Court Hears Abraham Appeal
Last month the Oregon Supreme Court heard oral argument in Abraham v. T. Henry Construction, Inc., a residential construction defect case. Shortly after the Oregon Court of Appeals published its opinion in September 2009, Ahead of Schedule authors Eric Grasberger (“Negligence Claims Take Another Twist in Oregon” and Kip Childs (“Oregon Court of Appeals Provides Clarification to Contractor Negligence Claims” commented on the decision. The case pits the homeowners, the Abrahams, against their general contractor, Keith Lucas, and framing contractor, Kevin Mayo.
Unhappy with the result in the Court of Appeals, Lucas and Mayo petitioned the Oregon Supreme Court seeking review on several questions that are described in the Court’s media release. Because the case involved several issues frequently litigated in construction defect cases (economic loss rule, statutes of limitation, building codes as the basis for a negligence claim, etc.), the Oregon Trial Lawyers Association (“OTLA”) and Oregon Home Builders Association (“OHBA”) weighed in and filed amicus curiae (literally, “friend of the court”) briefs. These briefs followed predictable lines of argument. Among other things, OTLA urged the Court to decide in favor of the plaintiffs and hold that, among other things, a discovery rule applies to breach of contract actions. For its part, OHBA suggested that the Court find that, absent a special relationship, one party to a contract (such the plaintiff project owner) should not be permitted to assert a negligence claim against the other party (such as the project’s general contractor).
Whether the Court will take up these important issues remains to be seen. However, until they are addressed by Oregon’s highest court (or legislature), these controversial issues will continue to be the source of much legal wrangling and uncertainty for both plaintiffs and defendants alike.
