Benefits and Risks of Involving a Project’s Contractor in The Design

By Karl Oles on March 25, 2021 Posted in Construction Industry, Design Build Agreements

The roles of designers and contractors are being combined for more and more construction projects, an approach that comes with both benefits and risks. Several methods of project delivery are commonly in use, none of which is entirely exclusive — different projects may include different and overlapping roles for owner, designer and contractor. In my latest column for the Daily Journal of Commerce I compare three methods of project delivery — “design-bid-build,” construction manager” or “CM,” and “design-build” — and outline some advantages, and risks, inherent to each as well as means of protection against the risks. Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on March 18, 2021.

New Washington Case Strictly Construes Lien Statute and Rejects Warranty Work as Basis to Extend Lien Filing Period

By Bart Reed and Loni Hinton on March 15, 2021 Posted in Commercial Construction Contracts, Liens, Washington

In its March 11, 2021 opinion, Division Three of the Washington Court of Appeals considered whether the 90-day period to record a claim of lien is extended by a contractor performing work after substantial completion to correct nonconforming work – usually referred to as “warranty work.” In the case of Brashear Electric, Inc. v. Norcal Properties, LLC, the Court strictly construed the statutory term “repairing” to exclude the contractor’s correction of its own work and rejected the notion that warranty work extended the 90-day timeframe to file a lien claim.

Norcal Properties, LLC (“Norcal”) and Blue Bridge Properties, LLC (“Blue”) own adjacent properties. Norcal and Blue separately contracted with Vandervert Construction (“Vandervert”) to construct a building on each property. The prime agreements’ substantive provisions were identical. Vandervert subcontracted with Brashear Electric, Inc. (“Brashear”) to work on both projects.

Under the prime agreements, Vandervert promised to correct nonconforming work up to a year after substantial completion. Vandervert’s subcontracts with Brashear required Brashear to assume the prime agreements’ warranty provisions. Continue Reading

Strategic Tips That Parties Should Consider When Mediating Disputes

By Sean Gay on February 22, 2021 Posted in Alternative Dispute Resolution, Construction Contracts

Nearly all construction industry standard form contracts require mediation as part of their dispute resolution provisions. Often confused with arbitration, mediation is a negotiation facilitated by a neutral third party. Unlike arbitration — a proceeding like a trial — mediation does not result in a final binding decision. And the mediator typically does not have any decision-making authority in the context of the mediation.

Instead, like any negotiation, the outcome of mediation is entirely in the hands of the parties. The mediator helps the parties by managing the exchange of information and other aspects of the negotiation process, like finding common ground and dispelling unrealistic expectations. In my latest article for the Daily Journal of Commerce, I provide some considerations parties involved in a mediation should keep in mind to maximize the possibility of a successful outcome. Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on February 18, 2021.

Three Tips for Owners and Contractors to Improve Their Odds of Success in 2021

By Tamara Boeck on January 20, 2021 Posted in Construction Industry, General

While all of us begin 2021 still confronting the challenge of COVID-19, construction project owners face particular pandemic-related issues in their industry, including the need to maintain strict best practices for projects and manage scheduling and labor challenges for existing and new projects. In my latest article for the Daily Journal of Commerce, I provide owners and contractors with three tips to increase their chance of success in 2021:

Negotiate and agree to reasonable contract terms for new projects, and verify carefully the status with regard to completion of existing projects.
Evaluate your insurance and consider whether a performance bond may be necessary to try to ensure work completion.
Diligently address project events such as deadlines, requirements and forecasts.

Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on January 14, 2021.

Why Early Mediations Often Fail, and Possible Remedies

By Eric Grasberger on January 7, 2021 Posted in Alternative Dispute Resolution, Construction Claims

Unlike 20 years ago, when a mediation – a commonly used route for resolving disputes in the construction claims process – was typically held close to the trial date, today the prospect of an early settlement can lead to the parties often seeking multiple mediation sessions over the course of a dispute. Additionally, construction and design contracts drafted recently generally call for an early mediation session before a lawsuit or arbitration demand can be filed. However, despite best intentions and highly competent mediators, early mediations often fail. In my latest article for the Daily Journal of Commerce, I look at a few steps the parties can take to increase the odds for a successful mediation. Read the column here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on December 22, 2020.

Ensuring Your Construction Project Remains Insured

By Andrew Gibson on November 24, 2020 Posted in Construction Claims, Construction Industry, Insurance

In too many cases, the developers, builders and designers of a construction project focus on starting work and pay inadequate attention to making sure important details of their insurance coverage are fully in place. Coverage denials can result from deferring to “standard” insurance forms, relying on informal broker assurances and not taking the time to fully the review the range of policy “endorsements” that may act to exclude particular claims. In my latest article for the Daily Journal of Commerce, I look at several of the more common insurance coverage mistakes that might reduce or negate your coverage and provide some best practices to keep in mind for your next time reviewing coverages or claims. Read the column here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on November 19, 2020.

OR-OSHA Publishes Model Infection Control Policy Required by New COVID- 19 Rules

By John Dudrey, Lou Ferreira, Karen O'Connor and Willa Perlmutter on November 19, 2020 Posted in COVID-19, Oregon, OSHA

On November 6, 2020, the Oregon Occupational Health and Safety Administration (“OR-OSHA”) published final temporary rules for workplace safety protections specific to COVID-19. Our alert about the new rules is available here.

Among other requirements, the new rules require employers to adopt a COVID-19 Infection Notification policy for notifying exposed and affected employees of possible exposure within 24 hours of learning that an infected individual was in the workplace. OR-OSHA yesterday published on its website a model Infection Notification policy, which you can review here. Employers must adopt a policy (whether their own or the OR-OSHA model) by Monday, November 16, 2020.

Please join us on November 19, 2020, at 11 a.m. for a webinar to discuss the new OR-OSHA rules. Registration information is available here.

Mitigation of Risk in the Age of COVID-19: Ten Ways Owners Can Protect Themselves Against Lien Claims in Washington

By Bart Reed on November 3, 2020 Posted in Construction Industry, Construction Liens, Risk Management, Washington

Among the many effects on the U.S. economy of the COVID-19 pandemic, construction projects that started before it began but were halted in its aftermath may be slow to resume or be abandoned altogether thanks to funding issues. Contractors, subcontractors, and suppliers feel immense pressure to protect and preserve their rights to payment for work performed on their jobs, and one tool they use to ensure they are paid is the construction lien. In my latest article for the Daily Journal of Commerce, I look at several strategies owners and developers can employ to mitigate the risk they face from lien claims. Read the article here.

Originally published as “OP-ED: Ways owners can protect themselves from lien claims in Washington,” by the Daily Journal of Commerce, October 15, 2020.

When to Have the Hard Talk About Setting Liquidated Damages

By Colm Nelson on October 2, 2020 Posted in Commercial Construction Contracts, Construction Contracts, Risk Management

In my latest column for the Daily Journal of Commerce, I look at the concept of liquidated damages – in my experience one of the top five heavily negotiated (and litigated) clauses in a construction contract. Because a project owner’s potential delay damages are often difficult to determine with certainty at the beginning of a project, the parties stipulate what those damages will be in advance through their contract – in other words, they liquidate the amount of the owner’s delay damages. In theory, at least, the benefit of this approach is that it provides both sides with certainty for a risk that is highly uncertain: late delivery. For a few suggestions as to what to include in this important risk-shifting clause, please read the column here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on September 17, 2020.

California Passes Bills Expanding Rights to Both Paid and Unpaid Leave

By Bryan Hawkins on September 24, 2020 Posted in California, COVID, COVID-19, Labor and Employment Issues

California Assembly Bill 1867 (signed by California Governor Gavin Newsom on September 9, 2020) and Senate Bill 1383 (signed on September 17, 2020) significantly expand the rights of California employees to both paid and unpaid leave. In addition, and especially as they relate to Senate Bill 1383, these laws will require California employers to promptly revise their policies and procedures when it comes to reviewing employee requests for unpaid leave.

Assembly Bill 1867

To recap, the Families First Coronavirus Response Act (“FFCRA”) provides that employees are entitled to up to 80 hours of paid sick leave for reasons related to COVID-19. FFCRA, however, applies only to employers with fewer than 500 employees. Like many ordinances adopted after the passage of FFCRA, AB 1867 attempts to fill the gap left by FFCRA by applying to employers with 500 or more employees.

AB 1867 fills this gap in two ways. First, it creates new California Labor Code section 248, which mirrors Governor Gavin Newsom’s prior Executive Order N-51-20. Section 248 requires entities with 500 or more employees to provide their “food sector workers” with up to 80 hours of “COVID-19 food sector supplemental paid sick leave.” Second, it also creates new Labor Code section 248.1. This section applies more broadly than section 248 as it requires that employers with 500 or more employees provide all employees with up to 80 hours of “COVID-19 supplemental paid sick leave.” Continue Reading