The Nebraska Court of Appeals has ruled that a home builder that fails to adequately compact the soil does not have insurance coverage to repair damages to the home caused by the settling soil. In “insurance speak”, there was no occurrence to trigger coverage. In this case, Cizek Homes, Inc. v Columbia National Insurance Company, a home builder contracted with a buyer to build a house. A lot was selected and [...]
Join us for our Fall Lunch & Learn Thursday, October 16th at 11:30. We will be discussing How to Prepare a Winning Request for Compensation. The topics we will cover include: Developing a Roadmap to Prepare the Claim Determining Applicable Contract Terms The Impact of Change Orders Identifying the Important Documents Calculating the Amount Owed Seating is limited, so please RSVP to Craig Martin, (402) 397-7300, or via e-mail: [...]
Two more courts have weighed in on the “your work” exclusion in commercial general liability (CGL) policies, finding that contractors did not have coverage for work performed improperly. These cases highlight that whether you have coverage for poor workmanship will depend on the state’s law applied. It now appears that if you are in South Carolina or Massachusetts, you will not have coverage. The South Carolina case, Precision Walls, Inc. [...]
As is often the answer in this blog, maybe. And, it will likely depend on which state’s law is applied. Over the last few weeks, courts around the country have reached differing conclusions on whether a general contractor may sue an architect that it did not hire. Here’s the situation: The owner hires an architect to draft plans for a project. The project is then put out for bid and [...]
Associated General Contractors recently reported that employment expanded in 65% of the metro areas it surveyed. While this is great news for the construction industry, of great concern is that 25% of the companies responding to the survey noted that they were turning down jobs because of labor shortages. The survey revealed that construction management employees, including project managers, supervisors, and superintendents, are in the shortest supply, followed closely by [...]
Engineering News-Record had an interesting editorial commenting on the bid protests on the New Orleans airport. The article analogized bid protests to video reviews at a football game -- they cause delays, but more often than not, they provide a clearer picture of what occurred. The same can be said of bid legitimate protests. Bid protests allow for a review of the decision making process. In the New Orleans airport [...]
Many have heard the quote attributed to Mark Twain over a 100 years ago: "Whiskey is for drinking; water is for fighting over." Those words are as true today as they were a century ago. Four South Central Nebraska farmers have decided to take their fight over water to court. The farmers allege they lost yields because the State diverted water away from the farmers' irrigation supply to comply with [...]
Nothing puts your record keeping practices under a microscope like litigation. Every piece of paper that you created or kept on a project may be reviewed and analyzed. And, every decision to throw away a document will be assessed to figure out why you didn't keep it. The best way to ensure you have the necessary documents to support your claim is to have a written document retention policy. Do [...]
On August 6, Missouri narrowly passed the "Right-to-Farm" amendment by 2,500 votes. Section 35 Article 1 of the Missouri Constitution will soon read: That agriculture which provides food, energy, health benefits, and security is the foundation and stabilizing force of Missouri's economy. To protect this vital section of Missouri's economy, the right of farmers and ranchers to engage in farming and ranching practices shall be forever guaranteed in this state, subject to [...]
On July 31, President Obama issued yet another Executive Order to crack down on “federal contractors who put workers’ safety and hard-earned pay at risk.” The new Executive Order, called Fair Pay and Safe Workplaces, will require federal contractors to report certain labor law violations from the previous three years when submitting a bid on projects. It also prevents the use of arbitration agreements to resolve employment discrimination claims. These [...]
Clients often times present problems with a project and explain the need to be compensated for the problems experienced. But, having a consistent theory for recovery and evidence that supports that theory is always paramount to recovery. I was reminded of this perhaps obvious corollary when reviewing an Armed Services Board of Contract Appeals decision. The appeal involved a $35 million request for additional compensation based on differing site conditions, [...]
The United States Department of Agriculture ("USDA") has created several incentive programs for landowners and beginning farmers to help move land ownership and farming operations from today's farmer to tomorrow's. Beginning Farmer or Rancher Land Contract Guarantee The USDA Beginning Farmer or Rancher Land Contract Guarantee Program encourages shifting land to beginning farmers through installment land contracts. This program is administered by the Farm Service Agency ("FSA") and offers two types of guarantees. [...]
Most construction contracts contain a “no damage for delay” clause that generally prevents a contractor from demanding compensation for a late starting or otherwise delayed project. But, if the owner or is representative actively interferes with the project, a contractor may still recover damages for delays. The recent case of C & C Plumbing and Heating v. Williams County, out of North Dakota found the owner liable for delays even [...]
A Massachusetts trial court recently ruled that a Construction Manager at Risk could not sue the owner for design defects even thought the owner provided the plans and specifications for the project. This ruling is a substantial shift from the Spearin doctrine which has historically made the party providing the plans responsible for any shortcomings or problems with the plans. In the case of Coghlin Electrical Contractors, Inc. v. Gilbane [...]
Like their Iowa counterparts, landowners and beginner farmers in Nebraska can take advantage of tax credits and loan programs implemented to assist the next generation of farmers. Nebraska Beginning Farmer Tax Credit The Nebraska Beginning Farmer Tax Credit Act provides an incentive for a farmer who is retiring or who wants to cut back on his or her operation to rent to a beginning farmer. A qualified beginning farmer or rancher [...]
Fellow blogger Chris Cheatham posted an interesting article on his The Electronic Claim blog about ways a contractor may profit from the labor shortage. The blog is based on an article, 5 Ways to Profit from the 2014 Labor Shortage, published by McGraw Hill-Dodge. An important takeaway deals with how subcontractors are responding to the greater need for their services and whether they are profiting from this change in the [...]
According to the U.S. Dept. of Agriculture Census of Agriculture, the average age of today's farmer has increased to 58 years of age. Concerns are increasing over who will step up as the next farming generation considering dramatic increases in land prices and the high cost of equipment and inputs make it difficult for new farmers to get a foothold. Recognizing the problem, state and federal governments have introduced incentives to [...]
We have all seen this situation before. The bids come in, the lowest is taken, and lo and behold, the subcontractor finds out that it cannot perform for the amount listed in the bid. When this happens, the subcontractor may take the position that the general contractor should have told the subcontractor that their bid was too low. The case of Fidelity And Deposit Co of Maryland v Casey Industrial [...]
I had the pleasure of presenting to the Omaha chapter of the National Association of the Remodeling Industry (NARI) last week on steps they could take to ensure that they get paid for their work. The majority of our discussion dealt with construction contracts and clauses that should be included in their construction contracts. The clauses that I recommended included: Identification of contract document Detailed scope of work Dealing with [...]
My friend and construction attorney, Chris Hill, raises a great point in his blog, Construction Law Musings, this week. He addresses the two questions you should always ask when pursuing construction litigation. The first, "Can you win the case and get a judgment?" The second, and as important, "Can you collect on that judgment?" I invite you to check out Chris's post Think Twice About Heading to Court with a Construction [...]
Approaching Storm Every spring and early summer, heavy rains, hail, and tornadoes force Midwest farmers into a game of "Crop Insurance Mother May I" regarding whether they will replant damaged crops. For crop insurance purposes, permission is almost always necessary when deciding whether to destroy and replant the damaged crop or destroy the damaged crop and plant a new crop. When facing a replant decision remember the following: "When a crop is damaged and it [...]
On June 17, 2014, the U.S. Department of Labor issued its proposed rules to implement Executive Order 13658 which requires federal contractors to pay a higher minimum wage. The Executive Order requires the hourly minimum wage to be increased to $10.10 an hour. Here are a few highlights of the proposed regulations: Effective Date The proposed rule will apply to contracts that are entered into after January 1, 2015. Covered [...]
Down in Florida, CH2M Hill and AECOM Technical Services were vying for the billion dollar project. CH2M Hill and AECOM submitted their proposal in the spring of 2013. CH2M Hill then submitted materials directly to county official prior to its August presentation. CH2M Hill was awarded the project. AECOM cried foul, claiming that CH2M Hill violated local rules when it submitted materials directly to county officials. The county’s ethics chief [...]
I recently came across an article in Construction Executive, by Edwin Foulke, listing 13 ways to improve your OSHA compliance record. Mr. Foulke is a prolific writer and presenter on occupational safety and health issues, and author of the Workplace Safety and Health Law Blog You can find a copy of his article here. Although Mr. Foulke’s article mentions 13 actions that can improve your OSHA compliance, a few of [...]
Today I'm guest posting on Chris Hill's excellent blog, Construction Law Musings. I've written an article on the recent state court opinions addressing whether faulty construction is an occurrence under Commercial General Liability insurance. Click here to see my post on Construction Law Musings.
On October 6, 2007 Thomas Latzel and Daniel Vanekelenburg were involved in a car accident with Patrick Gaughen at the intersection of County Road T and Count Road 17. Three years later, Thomas Latzel would die from the injuries he incurred in the accident. Thomas' wife, Amanda Latzel, brought a lawsuit against Ronald and Doug Bartek alleging they negligently planted corn too close to the intersection causing the accident. It [...]
The landmark case has been decided in favor of genetically modified ("GM")crop production. As described in It Was Bound to Happen, Steve Marsh sued his neighbor, Michael Baxter, for alleging his organic fields were decertified because of contamination from Baxter's Roundup Ready canola. canola field Marsh never grew canola, and the scientific evidence presented at trial proved "none of the Marshes crops or sheep...could acquire any genetic traits of Roundup [...]
BuildZoom recently published an article on Rising Construction Activity. What I found interesting was that Omaha has had the most consistent growth since 2011. The article compared cities such as Atlanta, Durham, Sacramento, Portland, Seattle and Omaha. For the years 2011, 2012 and 2013, Omaha consistently outpaced the other cities listed in the survey. As set froth in the article, in 2011, Omaha issued nearly 35,000 building permits, nearly 40,000 in [...]
After last week’s blog about what is covered by a CGL policy, I received a number of questions about whether Nebraska courts would cover faulty workmanship. So, what is covered by a CGL policy in Nebraska? The latest Nebraska Supreme Court case on this issue, Auto-Owners Ins Co v Home Pride Companies Inc, in 2004, ruled that faulty workmanship is not covered under a CGL policy. But, the insurer was [...]
This post was written by Jessica Nolan, a summer associate at Lamson Dugan & Murray, LLP. The Nebraska Construction Prompt Pay Act, Nebraska Revised Statutes, §§ 45-1201 to 45-1210, was amended and approved by the Governor on April, 16 of this year. The approved changes to the statutes (§§ 45-1201 to 45-1210) will be effective July 17, 2014. Importantly, the changes will only impact contracts entered into after that date. [...]
The federal government takes very seriously the Disadvantaged Business Enterprise (DBE) regulations. When a contractor hires a DBE, the DBE must do the work with minimal involvement or control by the general contractor. A Chicago based contractor, James McHugh Construction, decided to ignore the regulations and hired a DBE that it could control and used them as pass-throughs in order to obtain over $156 million in projects. McHugh won the [...]
Over 200 Landowners, farmers and small-business owners have joined the lawsuit Ideker Farms, Inc. et al v. United States of America alleging they incurred property damage as a result of the U.S. Army Corps of Engineers' management of the Missouri River from 2006 to 2013. Reuters May 5, 2014. The lawsuit alleges the Army Corps of Engineers changed their priorities from flood management to environmental management; resulting in increased frequency and severity of flooding [...]
The Texas courts continue to wrestle with the problem of what is covered by a CGL policy.Readers may recall that in September, 2012, I wrote a blog about a Texas case winding its way through the federal courts and then being shipped to the Texas Supreme Court for additional analysis. Well, earlier this year the Texas Supreme Court finally issued its opinion, finding that a CGL policy does cover faulty [...]
Additional Insured language is contained in nearly every construction contract. But how many of you are actually reviewing the additional insured endorsement? And, does it provide the coverage that you are required to provide? Nearly every construction contract requires that general contractors add owners as additional insureds and subcontractors must add the general contractor as an additional insured. Sometimes, the subcontractors must also list the owner as an additional insured. [...]
I’m pleased to announce that the Construction Contractor Advisor blog was selected as the Best 2014 Best Construction Blog by Construction News and Report Group. The judges for the competition evaluated the various construction related blogs for frequency, design, writing quality and relevance, and found this blog to be a good resource for all things related to construction law. Thanks to everyone that voted for the blog and thanks for [...]
We all know that I-9s must be completed when employees start. But, how many of you are doing a good job of completing the I-9 form and, more importantly, keeping the I-9 form and documents which must be attached? Perhaps part of your spring cleaning should be a review of your I-9 process and documentation retention practice. First, some sobering thoughts. The U.S Immigration and customs Enforcement (ICE) is the [...]
April 23rd was Construction Safety Day. Did you take a moment to review your safety policies and tool box talks about safety? If you didn't, perhaps you should. Melissa Brumback, my friend and author of the excellent Construction Law in North Carolina blog, recently reminded her readers that falls are the #1 source of construction-site fatalities, followed by falling objects, electrocution and being caught between two objects. Together these make [...]
Imagine that you are on a job that is significantly delayed. You tell the upstream contractor that performance at this late date will cost more money. Instead of being offered more money, you are told that you have to "mutually agree" on a revised schedule. How do you do that? One subcontractor in Oklahoma found out the hard way that walking off the job was not the answer. The case, [...]
Are you confounded by change orders? Do you want to learn to better deal with them? Join us on May 15th at 11:30 for our Lunch & Learn on Change Orders. During this presentation, we will discuss two questions about change orders: 1. What is the change order process? and 2. What if the general contractor won’t sign the change order? Lunch Will Be Provided Seating is limited, so [...]
Earlier this month, President Obama took action to impose additional compliance obligations on federal government contractors. An executive order will prohibit federal contractors from retaliating against employees who discuss their pay with each other. He also directed the Department of Labor to adopt regulations requiring federal contractors to provide compensation data based on sex and race. Non-Retaliation: This executive order provides that contractors will not discharge or in any other [...]
If you are doing work on Stratcom in Omaha, or any federal project, you are obligated to comply with the new Office of Federal Compliance Programs’ (OFCCP) final rules, effective March 27, 2014. Under these new rules, contractors have additional obligations, including gathering data and setting hiring goals for individuals with disabilities and protected veterans. Here are a few important aspects of the new rules: Update the Equal Opportunity Clause: [...]
The business manager of the Ironworkers Local 401 and ten members were recently charged with conspiracy to commit criminal acts of extortion, arson, destruction of property, and assault in order to force construction contractors to hire union ironworkers. (Hat tip to Wally Zimolong’s excellent blog, Supplemental Conditions) This case, brought by the U.S. Attorney out of the Philadelphia, stems from the Local 401’s tactics to force contractors to use union [...]
On March 6, 2014, the EPA issued the Construction and Development Effluent Guidelines and standards at 40 CFR Part 450.The significance of these new rules is that the EPA elected to use best management practices (BMPs) to control stormwater and minimize soil erosion pollutant discharges instead of a numeric limit on the amount of dirt in stormwater runoff from construction sites. Under the new rule, construction site owners and operators [...]
In the last post, I discussed a Montana case in which the contractor failed to follow the notice provisions contained in the contract and lost its claim because of it. But, sometimes a court will excuse your failure to follow the technical requirements of the contract. In a recent Nebraska case, the court excused a subcontractor’s failure to follow the notice provisions and allowed it proceed with its claim. The [...]
Time and time again, courts rule that contractors must follow notice requirements in order to submit a claim for additional time or compensation. This blog looks at yet another example of a contractor that failed to follow the notice requirements and lost its demand for additional pay. This case, JEM Contracting v. Morrison-Maierle, involved a highway project in Montana. The contract provided: Contractor shall notify the Owner and Engineer in [...]
On March 24, the Environmental Protection Agency (EPA) proposed a new definition of "waters of the United States" as applied in the Clean Water Act (CWA). The definition of "waters of the United States" currently means: (a) All waters which are currently used, were used in the past, or may be susceptible to use in interstate or foreign commerce, including all waters which are subject to the ebb [...]
On January 21, 2014, Nebraska State Senator Bill Avery, introduced a bill (LB1005), which would create a board to govern the use of surface and groundwater. Currently, surface water is controlled by the State's Department of Natural Resources while groundwater is regulated by 23 Natural Resource Districts (NRDs). Recognizing a direct connection between surface water and ground water, Avery believes one board would provide a consistent regulation over the state's [...]
The Fifth Circuit Court of Appeals recently ruled in Woodward, LLC v. Acceptance Indemnity Insurance Company, that a general contractor, named as an additional insured, did not have coverage for claims that a subcontractor performed faulty work. At issue was the language in the additional insured endorsement, which provided coverage for ongoing operations, not completed operations. The court held that the damages arose out of completed operations not the subcontractor’s [...]
Iowa subcontractors convinced the Iowa Supreme Court that the Iowa Department of Transportation ("IDOT") should cover unpaid balances the general contractor owed to subcontractors. Although this ruling will only apply to situations where the IDOT has waived the bonding requirement for certain contractors, it’s still a great win for subcontractors. This case, Star Equipment v Iowa, involved the construction of a roadside rest area along Interstate 80. Universal Concrete was [...]
Incentives work. Trust me, I use incentives all the time to get my three year old to sit still, eat his dinner, and stop asking me "why?" So why don't you ever see crop insurance agents incentivizing clients with bargains on premiums? Incentives on crop insurance rates, no matter how small, are not allowed. In the crop insurance world such incentives are called "rebates" and offering rebates is illegal under the Federal [...]
