Category: Construction Litigation

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Think the ADA preempts contractual risk shifting? Not so fast, says the Ninth Circuit.

Rejecting an argument that the ADA preempts all contractual claims for indemnity and contribution, the Ninth Circuit recently upheld a public owner’s right to seek contribution for damages arising out of ADA violations caused by the designer and contractor of a transportation facility. See City of Los Angeles v. AECOM Services, Inc. (here). This decision … Continue Reading

What’s Up with Bertha?

Regular readers of this blog know that Stoel Rives represents the State of Washington Department of Transportation (“WSDOT”) with regard to construction of the new highway 99 tunnel in downtown Seattle. The giant tunnel boring machine, named “Bertha” (not “Big Bertha” as is sometimes reported), finished its work in April and is now undergoing a … Continue Reading

WSBA Construction Section Annual Seminar – June 9, 2017

On June 9, 2017, my colleague, Karl Oles, and I (both from the Seattle office of Stoel Rives) will present at the annual meeting and seminar for WSBA’s Construction Section, which this year is entitled Washington Statutes Affecting Construction.  This seminar, located at the WSBA Conference Center in Seattle, will feature in-depth discussions regarding important … Continue Reading

Alter Ego: The $5MM personal danger of neglecting corporate formalities and utilizing substandard building materials

Many building developers utilize a single purpose entity limited liability company (an “LLC”) to purchase and develop property, such as an apartment complex, a subdivision, or a shopping center. Generally, an LLC’s debts, whether incurred or judicially imposed, belong only to the LLC, not to its members.  However, an LLC’s individual member may be subject … Continue Reading

Redefining Priorities: Risk Management, Enhanced Quality, and Minimizing Disputes

When engaging in a new construction project, the primary focus is frequently on the immediate issues — plans, permits and the build-out itself.   But building good risk management procedures and techniques into the front end of your project planning can have bottom-line business benefits. In my recent article for the Daily Journal of Commerce, written … Continue Reading

One Unanticipated Cost of Being an Owner-Builder in California: Liability for Retained Control over Safety

Many times I hear from people who want to “save money” and serve as their own “owner-builder” under the exemption to the California Contractor’s Licensing law, which generally requires that any “construction” work over $500 to be performed by a licensed California contractor in the absence of an exemption.  (Bus. & Prof. Code section 7048).  … Continue Reading

Self-Imposed ADA Audits: The Developer’s Best Option

Recent rulings indicate that courts across the country view project owners’ and developers’ liability for ADA claims differently than they do other compliance violations.  Owners’ attempts to raise questions of contractor negligence, breach of contract or breach of warranty are being rejected.  So what can a project owner do? In my recent article for the … Continue Reading

Architect Off the Hook for ADA Defects

Continuing a disturbing trend, another recent case finds that an architect is not liable for a design that failed to comply with the ADA and Section 504 of the Rehabilitation Act (RA). In Chicago Housing Authority v. DeStefano & Partners, Ltd. (here), an Illinois appellate court followed several other federal and state decisions in holding … Continue Reading

“Without Performance Specifications, Green Building Can LEED to Disputes

It’s been more than 20 years since the LEED standard was introduced, and green building has now become a significant percentage of new U.S. commercial real estate construction.  The benefits of green building techniques and products have made LEED certification a hot commodity and changed the construction industry.  But there are also risks involved if … Continue Reading

“From, For, and Against”: What’s the Difference?

Indemnity provisions are often among the most negotiated and least understood provisions of commercial contracts, and construction contracts are no exception to this rule. Despite, and perhaps because of, the importance of these clauses, they have evolved into an almost impenetrable jumble of legal terminology. This jumble of words is not, however, without meaning. Although … Continue Reading

A New Wrinkle In Time To Claim Construction Defects

Oregon’s law on statutes of limitation and/or repose periods on construction claims is complex and ever-changing.  A recent Oregon Supreme Court ruling has introduced yet another instance of differing time limits on construction defect claims. In my recent article for the Daily Journal of Commerce, I discuss Schell v. The Schollander Companies, Inc. and the … Continue Reading

Termination Clauses a Must for Owners

The recent termination of the joint venture of Skanska-Hunt from the Washington State Convention Center project (article here) is a good reminder of the importance of well-written termination clauses in your owner-contractor contracts.  The reasons for termination (or “severance,” a slightly kinder word) can be many, including failure to agree on pricing (the reason given … Continue Reading

Think all Oregon construction defect claims are governed by the same 10-year statute of repose? Think again.

In Shell v. Schollander Companies, Inc., the Oregon Supreme Court affirmed a line of appellate decisions distinguishing between defect claims arising out of construction performed for an owner and defect claims arising out of an owner’s purchase of an existing structure.  In Schollander, the homeowner sought recovery for defects in the construction of a spec … Continue Reading

Yes, Contractor Licensing May Be Required Under California Law Even if the Contractor Does Not Physically Build Anything Itself

It seems that almost weekly, and certainly monthly, I receive a call or inquiry from colleagues and/or prospective clients as to whether a license is really required if the prospective “contractor” is not actually building anything but is merely facilitating a “deal” or is hiring otherwise qualified and licensed contractors and trades. Virtually every time … Continue Reading

Court of Appeals affirms Brightwater judgment, reviews law regarding differing site conditions and surety obligations

On November 9, 2015, Division One of the Court of Appeals affirmed a 2012 King County trial court judgment that joint-venture tunneling contractor Vinci Construction Grands Projets/Parsons RCI/Frontier-Kemper (VPFK) was liable to King County for $144 million in damages and attorney fees. The case arose from the Brightwater project, a wastewater treatment plant north of … Continue Reading

Take Care in Reaching for Deep Pockets: Don’t Let Insurance Companies Off the Hook When Drafting Settlement Agreements in Construction Defect Cases

It will happen to almost every contractor at some point — an owner or project developer will try to sue you.  Hopefully your insurer agrees you are covered, and you’ve dodged a bullet. But if your insurer tells you that you are not covered, things get sticky.  One common strategy is for the parties to … Continue Reading

Protections Against Subcontractor Defaults

Subcontractor default is a construction project nightmare that can result in significant additional costs and delay completion of the project. But there are two chief options to protect against such risks — performance bonds and subcontractor default insurance.  In my recent article for the Daily Journal of Commerce, I outline the unique characteristics of each … Continue Reading

The Jury’s Out: AAA Issues New Construction Industry Rules Expanding Powers of Arbitrators

There are inherent risks in proceeding to trial by jury. Juries are often unpredictable, and civil litigation also requires extensive discovery and motions practice, which can delay resolution and increase uncertainty and costs. Arbitration has long been accepted as the answer to these problems. But the changing nature of disputes, increasing costs and inefficiencies have … Continue Reading

Contract Conflict Bears a Cautionary Tale

In the haste to get design and construction moving on real estate projects, one may lose sight of important lien priority issues when negotiating and executing contracts. In my recent article for the Daily Journal of Commerce, I discuss a notable Washington appellate case that addresses a lien priority issue in the context of multiple … Continue Reading

Finishing Strong vs. Finishing Wrong: Tips & Traps for Project Completion

Complex construction projects carry complex problems as they approach completion. In my recent article for the Daily Journal of Commerce, I address 10 potential pitfalls that owners, contractors and design professionals may encounter, and I offer tips to help you prepare for them. Read the full article here. “Finishing Strong vs. Finishing Wrong: Tips & … Continue Reading

All is Not Well with Oregon’s ELL

In my latest Daily Journal of Commerce Construction column, I discuss Oregon’s Employer’s Liability Law or the ELL, workers’ compensation and why the Oregon legislature should take another look at these piecemeal laws. As it stands, the party with the greatest culpability may not pay anything for the injuries they cause. Read the full article here. … Continue Reading

Multi-Family Sellers Beware: Don’t “Alienate” Your Project from Insurance Coverage for Construction Defects

The apartment business is booming right now. Unfortunately, construction defects persist as well, particularly in garden-style and wood-framed construction. Most developers are savvy enough to maintain a good insurance program, but many do not understand (until too late) that the policies they bought may not cover the risk of construction defects.  As an owner-developer, neither your property … Continue Reading

Pay Attention to Your Contract Terms and Scope – Recent Washington Supreme Court Decision Reshapes Independent Duty Doctrine

In a recent case, Donatelli v. D.R. Strong Consulting Engineers, Inc., 312 P.3d 620 (Wash. 2013), a sharply divided 5-4 opinion by the Washington Supreme Court provides further evidence that the line between Washington’s “economic loss” rule and “independent duty” doctrine remains quite blurred.  The case arose out of an agreement between property owners, the … Continue Reading
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