Earlier this year, my colleague Eric Grasberger authored a blog post about a crane collapse in Lower Manhattan.  In that post, he mentioned that neighboring landowners may seek to prevent cranes from intruding into the airspace above their property.  Contractors and owners alike are often surprised to learn that a crane swinging over adjacent property

On Friday, February 5, one man died and three were injured when a 565-foot crane toppled in gusty winds in lower Manhattan, not far from the World Trade Center. The investigation will likely take weeks to months as experts try to reconstruct whether the engineering, erection, operation or manufacture of the crane, or some combination

In my latest Daily Journal of Commerce Construction column, I discuss Oregon’s new 5% retention rule. Parties negotiating construction contracts should stay mindful of how the new retention provisions may force changes to other contract and how such changes may affect all parties throughout construction of the project.

Read the full article at the Daily Journal

Those that “dig in the dirt” are very familiar with the Damage Information Reporting Tool (DIRT), which was launched in 2003 by the Common Ground Alliance (CGA). Over the years California has enacted several statutes requiring anyone moving dirt to notify a regional notification center of the area of planned disturbance that may impact a subsurface

In my recent article, "Contractor Not Entitled to Setoff Costs of Repairing Subcontractor’s Defective Work," I discuss the Oregon Court of Appeals’ decision that a contractor cannot terminate its subcontractor for convenience and setoff costs incurred in repairing the subcontractor’s defective work (affirming the trial court’s decision).

Read the full article, here.

"Contractor Not

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 insurance policy (including your builder’s risk policy) nor your general liability policy is likely to protect you from the cost of repairing defects to property you own. Most likely, your property policy has an exclusion for any damages caused by defects in construction or design. And your liability policy has exclusions for property damage to any property you currently “own, rent, or occupy.” (See exclusion J(1) below.) 

Even more surprising to some is another exclusion that prevents coverage for property damage to property that you “sell, give away or abandon” (known as the “alienated property exclusion”).  (See exclusion J(2) below) This means that for projects you develop, occupy (i.e., rent) and sell, you likely have no coverage during your occupancy of that project or after you sell  (whether to unit owners through a condo conversion or to another apartment owner). 

j.          Damage to Property

“Property damage” to:

(1)        Property you own, rent, or occupy, including any costs or expenses incurred by you, or any other person, organization or entity, for repair, replacement, enhancement, restoration or maintenance of such property for any reason, including prevention of injury to a person or damage to another’s property;

(2)        Premises you sell, give away or abandon, if the “property damage” arises out of any part of those premises;

Upon learning of this unfortunate situation, many developers ask: What good is the policy if it doesn’t cover me when I own the project and it doesn’t cover me after I sell it? Good question. The insurer’s response is that the policy only covers damage to other people’s property (like the project next door), not damage to your own property or the property you once occupied and sold.  Strangely, if you sell the project before you occupy it, coverage is more likely. 

Solutions?  There are steps you can take to minimize your risk: 

A California appellate court has clarified for public owners and contractors (a) what the results may be if the owner does not timely sign a change order and (b) under what circumstances a change order is required. In G. Voskanian Construction, Inc. v. Alhambra Unified School District, No. B221005 (Cal. Ct. App. Mar. 29, 2012)

Have you noticed unusual language in a client’s contract pertaining to broad waivers of subrogation and acceptance of risks that you never thought your client would have? A brief trend in contract negotiations for many industrial projects has been the appearance of the so-called “knock-for-knock” indemnity provision. The term “knock-for-knock” is typically used for a