General Business Construction Finance & Banking

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Money, Dirt & Steel: Spring 2015 NC Real Property Litigation Update

MONEY: GUARANTORS CAN NOW RELY ON G.S. §45-21.36 VALUE DEFENSES - By statute in North Carolina, G.S. §45-21.36, certain obligors may defend a deficiency action where the bank is the successful bidder by arguing...more

OAS UPDATE: Bankruptcy Court Grants Limited Temporary Relief in Chapter 15 Case

Background: Grupo OAS, a Brazilian construction conglomerate linked to a massive corruption scandal (“OAS”), filed for Chapter 15 creditor protection in the Bankruptcy Court for the Southern District of New York on April 15,...more

Construction Law Advisory - May 2015

In This Issue: - Beware of penny bidding: Contractors could be stuck footing the bill for differing site conditions - Pennsylvania Supreme Court weighs whether good faith refusal to pay is a factor in awarding...more

Bank ordered to honour refund guarantees despite foreign court orders prohibiting payment

The Claimant Buyers brought proceedings against the Defendant Bank under refund guarantees issued by the Bank in support of two shipbuilding contracts between the Buyers and Sellers. Pursuant to the contracts, the Claimant...more

Security on Large Construction Projects. The Payment Remedy You Probably Never Heard of

California has a number of statutory payment remedies available on construction projects. Some, such as the mechanics lien, are relatively well known and often utilized. Others, such as the stop payment notice, are somewhat...more

From Handshake to Ribbon Cutting: Lessons in Implementing Economic Development Incentives that Avoid Clawbacks

Once an incentive agreement is in place, it is time for the company to get to work building and staffing the new or expanded facility. While the economics of a deal are typically still on track, the initial buildout/expansion...more

Letters of the Law: 'G' is for Guarantee

Security in the form of guarantees (or bonds) is common practice in construction projects. With contractors, sub-contractors, suppliers and even consultants being required to provide some or all of tender, performance,...more

7th Circuit Rules That Title Insurer Is Not Liable for Construction Liens Resulting From Lender’s Failure to Fund

The 7th Circuit has ruled that a lender is not insured by a title company for liens that arise after a construction loan became significantly out of balance and the lender stopped funding. In BB Syndication Services, Inc v....more

To Fund or Not to Fund – that is the Question

On Friday the 13th (3/13/2015), the Court of Appeals for the 7th Circuit decided that a title insurer did not have to provide coverage to its insured – the perfected, first lien lender – for priming mechanics’ liens that –...more

Seventh Circuit Court of Appeals: No Coverage under Title Insurance for Mechanics’ Liens Arising after Construction Lender Stops...

On March 12, 2015, the United States Court of Appeals for the Seventh Circuit entered an opinion interpreting “the most litigated provision in the standard-form title-insurance policy purchased by real-estate lenders to...more

Summary of HUD’s LEAN 232 Program Email Blast: Office of Residential Care Facilities (ORCF), February 2015

In an effort to summarize the highlights of the LEAN Email Blasts that we receive, and rarely have time to review in a timely fashion, we at Pepper Hamilton are providing this quick synopsis of the latest LEAN update. Our aim...more

Colorado Supreme Court: Construction Lender's Subsidiary Is Not a Subsequent Purchaser - Negligence Claim May Not Be Asserted...

Lenders and contractors may want to take additional precautions before they take title to a newly constructed home through foreclosure (or deed in lieu of foreclosure) following a recent decision by the Colorado Supreme...more

Understanding the 4 “P’s” Before the P3 (Public-Private Partnership)

To get a P3 proposal to the starting line, public officials need to make sure that there is clarity and agreement on basic issues and priorities - Aging and inadequate infrastructure, required upgrades and scarce...more

Sound Bites from Infocast Wind Finance 2015

The Infocast Wind Power Finance & Investment Summit 2015 was held from February 10 to 12 in San Diego. Below are selected sound bites regarding the tax equity market and other finance related matters....more

Surety Bonds: Direct Claims v Derivative Claims – Who Knew?

New Bern Riverfront Dev., LLC v Weaver Cooke Constr., LLC (In re New Bern Riverfront Dev. LLC), 521 B.R. 718 (Bankr. E.D.N.C. 2014) – The debtor made claims against a surety that issued a performance bond in connection with a...more

Letters Of Intent In Construction Project Negotiations, P.2

In our last post, we began speaking about letters of intent and their use in negotiating the terms of construction projects. As we noted, letters of intent are not contracts, but courts do sometimes enforce them as binding,...more

Letters Of Intent In Construction Project Negotiations

Anyone who works in the construction industry knows how important it is for everybody to have the same understanding about the terms of a project, including the materials needed, deadlines to be met, and the procedure for...more

First Reg A Issuer to Complete State Review Process Would Do It Again

This Growth Capital Investor article references Smith Anderson attorneys Benji Jones and Merrill Mason. A company that focuses on micro-lending for independent builders in real estate is now the first Reg A issuer to...more

The Status of Lien Waivers in Utah Remains Cloudy

On December 19, 2014, the Utah Supreme Court issued its opinion in Lane Myers Construction, LLC v. National City Bank, et al. 2014 UT 58 (UT 2014). In this case, a total of nine Utah jurists considered the question of whether...more

Oil and Gas Restructurings: Exploration and Production Companies Face Unique Issues

The recent drop in oil prices will likely spur a flurry of industry restructurings, governed by a complex set of bankruptcy and state laws. Introduction - At the close of business on December 31, 2014, the...more

Act 117 Brings Significant Changes to Mechanic’s Lien Law

Over the summer, Governor Corbett signed into law Act 117 of 2014 (the “Act”), which brings two significant changes for contractors to the Mechanic’s Lien Law of 1963. First, subcontractors are now prevented from filing...more

Guarantor Waivers Narrowed

A general waiver by a guarantor of “all defenses” does not actually waive “all defenses.” California Bank & Trust v. Del Ponti, — Cal.Rptr.3d —, 2014 WL 6908141 (Cal.App. 4 Dist.). That was the holding in a recent opinion...more

Equitable Subordination: Construction Lenders Beware

Atlantic Builders Group, Inc. v. Old Line Bank (In re Prince Frederick Inv., LLC), 516 B.R. 778 (Bankr. D. Md. 2014) – A construction contractor contended that the claim of the debtor’s construction lender should be...more

What’s in that Contract Again? Reflections on the Recent Recession

During and immediately after the most recent recession, construction litigation seemed to hit an apex. New pre-litigation matters to resolve monetary disputes from recession-era construction projects continue to keep many...more

N.C. Court of Appeals: Limitations Period Does Not Apply to Local Government Enforcement of Subdivision Performance Bonds

A post-Great Recession treat, the North Carolina Court of Appeals affirmed today a ruling that the Town of Black Mountain is entitled to enforce subdivision performance bonds originally in the name of Buncombe County, after...more

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