Managing Engineering Liability and Risk in Oregon

On February 25, 2022, my colleague Zachary Davis and I will be presenting as part of a HalfMoon Education live interactive webinar Managing Engineering Liability and Risk in Oregon. Zachary will present “Law of Engineering Malpractice,” an overview of professional liability claims. I will present “Understanding How Contracts Can Shift, Reduce (or Increase) Risk,” an overview of contract law and key concepts. Click here to learn more and to register online.

Every Construction Project Comes With Risk, but It Can Be Managed

In my latest article for the Daily Journal of Commerce, I provide a few suggestions for contractors, and perhaps project owners as well, to manage risk through a construction contract. Provisions that can be included in a contract to achieve that end might include:

  • The owner limits its potential claims to direct damages and waives claims for consequential damages.
  • The contractor’s maximum liability to the owner is capped at a stated sum.
  • The contractor’s potential liability for late performance is limited to a set amount per calendar day.
  • The contractor’s bid includes contingency to guard against unforeseen risks, or provisions to address material price escalation or “force majeure” events such as pandemics.

Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on January 20, 2022.

 

Ideas to Help Contractors Build Better Projects in the Year Ahead

The year 2021 was an interesting and unsettled one in the construction industry — bids and projects grew in numbers in some market sectors and regions yet slowed or halted in others. An aftereffect of this activity was a variety of claims and disputes, which, coupled with the ongoing pandemic and increasing market uncertainty, particularly with respect to the supply chain, led to a year of disruption for the industry. In my latest article for the Daily Journal of Commerce, I provide some suggestions for those in the construction industry, and specifically contractors, to get ahead of similar claims and disputes in 2022. Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on December 20, 2021.

Don’t Overlook Your Liquidated Damages Provision

Among contractual provisions that sometimes go unnoticed or unappreciated is the “liquidated damages” provision, which is often used in construction contracts to identify the amount of damages that a contractor will owe the owner if there is a delay in completing construction. In my latest article for the Daily Journal of Commerce, I provide some tips for owners and contractors to avoid the potentially harsh consequences, waiver of a potential benefit, or unnecessary litigation that can be the byproduct of inclusion of this provision in a construction contract. Read the full article here.

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

‘Project Float’: Who Owns it and What Should Be Done About It?

Construction projects are complex and often experience delays.  The party responsible for the delay can find itself subject to potentially severe consequences. There are various ways project owners and contractors can cause project delays, and each party wants to “own” the project float to be able to apply the project’s extra schedule time toward its own delays and avoid potential liability. Courts have grown increasingly sophisticated in determining how much and to which parties float should be allocated in disputes over delays. In my article for the Daily Journal of Commerce, I examine the question of who owns the project’s float and discuss “float-sharing” and “float-allocating” clauses, for which owners and contractors often negotiate in their contracts to protect themselves against construction delays. Read the full article here.

Surety Bonds vs. Subcontractor Default Insurance

If a contractor cannot meet deadlines on a construction project or a subcontractor pulls out of a new project bid in order to pursue a more attractive opportunity, the project owner and/or prime contractor face potentially significant damages, which can include corrective work, costs of completion or substitute performance, and delay. In my latest column for the Daily Journal of Commerce, I discuss the characteristics of the two most important options that exist for owners and prime contractors to protect themselves against such risks – performance bonds and subcontractor default insurance (SDI) – and provide some suggestions to help them pick the appropriate one. Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on September 16, 2021.

Construction Contract Termination Provisions: Recent Washington Case Examines Parties’ Rights

The importance of carefully drafting, and following, a construction contract’s termination provisions was made clear for project owners and contractors by a recent Washington Supreme Court decision, Conway Construction Co. v. City of Puyallup. The city contracted with Conway to build a major roadway, but when the city lost confidence in Conway’s work, it issued the contractor a notice of termination for default and withheld payments. In the ensuing case, the Washington Supreme Court sided with Conway, holding that the termination was improper because evidence showed that Conway did not neglect or refuse to correct the defects – as was required by the contract – and affirming that the city could not claim an offset for defective work that was discovered after termination. In an article for the Daily Journal of Commerce, we provide a few tips for owners and contractors that may reduce their risk of claims and preserve their right to damages, in light of the Conway decision. Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on Aug. 19, 2021.

A Key Battleground: Material Price Escalations and Supply Chain Disruptions

At the forefront of concerns for those in the construction industry is the escalation in material prices and disruptions to supply chains that were in large part a byproduct of the pandemic. Project owners and contractors want to understand their rights with regard to these risks and also how the risks should be apportioned. In my latest column for the Daily Journal of Commerce, I look at how contractor risk is shared using a variety of methods in several types of commonly used construction contracts. I also provide some suggestions to help parties to a stalled contract negotiation find an outcome in which both the owner’s and contractor’s interests are aligned. Read the full article here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on July 16, 2021.

Don’t Be Late! (But Assume That Your Construction Project May Be)

Today, the construction industry faces a myriad of challenges – as well as the COVID-19 pandemic, rapidly increasing construction material costs, labor and material shortages, and a hot housing market are potential obstacles for project owners and contractors that, despite their best efforts and intentions, could prevent them from completing their construction projects on time. In my latest article for the Daily Journal of Commerce, I look at some steps owners and contractors can take to mitigate the risk brought by these challenges. Read the full column here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on June 17, 2021.

Liability Laws Still Require Contractors to Follow Safety Guidelines

About a year ago, I wrote a column for the Daily Journal of Commerce about effective COVID-19 safety policies and what contractors can do to maximize job site safety to comply with developing Occupational Safety and Health Administration (OSHA) and Centers for Disease Control and Prevention (CDC) COVID-19 safety standards and guidelines. In the interim,  much has changed but much has remained the same – OSHA and CDC guidance, as well as how businesses must operate during a pandemic, continues to evolve, but the fact remains that contractors still need to make their job sites safe and take steps to prevent their employees and clients from contracting COVID-19 on the job site or at the office. In my latest column for the DJC, I look at a few of the liability issues facing contractors and outline a few steps for them to protect themselves from such liability. Read the full column here.

Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on May 20, 2021.

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