General Business Construction Civil Procedure

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Changes Made to the Pennsylvania Mechanics’ Lien Law to Protect Holders of Open-End Mortgages and Residential Property Owners

Mechanics’ liens grant contractors and subcontractors an interest in improvements made to real property to secure the payment obligations of owners to contractors, and of contractors to subcontractors. While these liens...more

Alabama Supreme Court Reverses Course, Finds Insurance Coverage for Faulty Workmanship Claims

Companies such as homebuilders, construction companies and contractors face significant financial risk from bodily injury and property damage claims arising from allegedly faulty workmanship or construction defects. Although...more

Insurance Coverage – Duty to Defend – Construction Defects

Regional Steel Corporation v. Liberty Surplus Insurance Corporation - Court of Appeal, Second Appellate District (June 13, 2014) - There has been a split of decisions in California as to whether incorporation of...more

5th Circuit Holds No Duty to Indemnify Based on Contractual Liability Exclusion

In its recent decision in Crownover v. Mid-Continent Cas. Co., 2014 U.S. App. LEXIS 12158 (5th Cir. June 27, 2014), the United States Court of Appeals for the Fifth Circuit had occasion to consider whether the Contractual...more

CSLL Does Not Bar Successor Entity’s Compensation Claims After Contractor’s Change of Business Entity During Construction

A recent decision by the California Court of Appeal imposed a sensible limit on the prohibition of compensation claims by unlicensed contractors under the Contractors’ State License Law (“CSLL”), specifically California Bus....more

Massachusetts Superior Court Holds Construction Manager At-Risk Responsible for Design Errors / Holds that Spearin Doctrine Does...

The Worcester Superior Court recently issued a potentially landmark decision clarifying the risk that construction managers assume when entering into CM-At Risk contracts. ...more

When Can a CGL Policy Do a Disappearing Act?

In Evanston Insurance Company v North American Capacity Company, 2014 U.S. LEXIS 92682, Evanston Insurance Company sued in U.S. District Court to seek contribution from North American Capacity Insurance Company where both...more

Limitation of Liability Clauses

Many industry form documents and custom construction contracts contain provisions shifting or limiting the respective parties’ risks. One of the more potentially significant risk-limiting provisions seen primarily in...more

News for Contractors and Construction Lenders in Arizona and Nevada – The Contractors' Lien May Trump the Bank's

In addition to an arid climate and plenty of sunshine, Arizona and Nevada have something more to offer contractors: a potentially advantageous position over lenders when a project goes bad. When a project derails and...more

Disclosure By Developer Binds Condo Purchasers

Condominium purchasers often do not read the Disclosure documentation which accompanies their Agreement of Purchase and Sale. The Disclosure documentation is important because it contains information which may have an impact...more

Court of Appeal Ameliorates (a Bit) the "Harshness" of Business and Professions Code Section 7031

California courts have variously described Business and Professions Code section 7031 as “draconian,” “harsh[ ]“ and “[u]njust[ ],” but nonetheless enforceable. Section 7031 both prohibits unlicensed or improperly...more

California Supreme Court Upholds Design Professionals' Duty to Future Residential Purchasers

Design professionals, such as architects and engineers, often seek to avoid liability to third party property purchasers for their negligence by arguing that their role in preparing plans was too remote for a duty to be...more

Architects May Be Sued Directly by Homeowners Association for Design Defects

In a unanimous decision, California’s Supreme Court has ruled that the principal architects for a condominium project may be sued directly by a condominium homeowners association for design defects. The case, decided July 3,...more

Construction Contracts – Limitation on Recovery For Unlicensed Contractor

E.J. Franks Construction, Inc. v Bhupinder K. Sahota, et al. - Court of Appeal, Fifth Appellate District (June 5, 2014) - The purpose of the Contractors’ State License Law (Business & Professions Code sections...more

Texas Supreme Court Unanimously Blocks Contractors' Economic Loss Tort Claims Against Designers

Texas contractors have long tried to directly sue their owners’ professional design firms -- rarely with success -- when faulty plans cause economic losses such as increased costs from delays and disruptions. A few cases in...more

When Is a Construction Defect a Mere Business Risk and Not Insurable?

In an unpublished appellate decision from the state of Washington, on May 5, 2014, the Washington Court of Appeals affirmed a summary judgment in favor of a CGL insurer, Western National Assurance, relieving it of any...more

Privilege Issues Are Important in Homeowner Association Construction Defect Litigation

Attorneys in Homeowners Association (“HOA”) construction defect cases must meet with the homeowners to provide litigation updates and it can sometimes be difficult to preserve the attorney-client privilege for the...more

More Legal Developments for the Construction Industry in the Southeast

Alabama - The Alabama Supreme Court reversed itself and concluded that faulty workmanship can constitute an “occurrence” under a commercial general liability insurance policy which triggers coverage for the insured. In a...more

Construction Lenders Beware: Unbonded Stop-Payment Notices May Be Worth More Than The Paper They Are Written On

A common perception in the construction industry is that the most valuable part of an unbonded stop payment notice is the paper it is written on, at least when it is served on a construction lender. While an unbonded stop...more

Legal Alert: Supreme Court of Texas Finds Contractors Cannot Recover Delay Damages for Negligent Misrepresentation Against an...

On June 20, Texas joined a number of states that apply the economic loss rule to damages claims arising from negligent misrepresentation between contractors and the owner’s architect. In LAN/STV v. Martin K. Eby Construction...more

Newly-Published Regional Steel Case Raises More Questions Than It Answers

In May, California’s Second Appellate District affirmed a summary ruling that a Commercial General Liability insurer did not have a duty to defend a subcontractor who supplied faulty “seismic tie hooks” that were encased in...more

Iowa Court of Appeals Rejects Argument to Impose Implied Warranty upon Land Developers

On April 16, 2014, land developers and sellers breathed a sigh of relief after the Iowa Court of Appeals ruled that a purchaser of a residential building lot cannot sue the land developer for perceived deficiencies with the...more

Federal District Court in Pennsylvania Allows Negligence Suit Against Builder Despite Lack of Privity of Contract Between the...

A Federal Court in Pennsylvania has handed down a ruling that may expand the pool of potential plaintiffs in construction litigation. See AMCO Insurance Co. v. Emery and Associates, 926 F. Supp. 2d 634 (W.D. Pa. 2013). In...more

Collateral Estoppel Sinks LLC Members' Claim

It might seem uncontroversial that the members of a limited liability company cannot follow with a personal lawsuit for injuries after their LLC litigates, and loses, claims based on the same issues. But it took the Business...more

The Construction Advantage – Issue 5

In our fifth issue of The Construction Advantage, we discuss some potential federal tax legislation, the time of accrual for a statute of limitation on an indemnity obligation, and a payment bond case recently decided by a...more

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