Construction Contract Basics: Venue and Choice of Law
February 19, 2024 —
Christopher G. Hill - Construction Law MusingsPreviously in this on-again-off-again series of posts on construction contract basics, I discussed attorney fees provisions and indemnification. In this installment, the topic at hand is venue and choice of law.
As construction professionals (outside of us construction attorneys), you are likely to be focused on things like the scope of work in a construction contract, the price terms, payment, delays, change orders, and the like. However, the venue (where any lawsuit or arbitration will have to happen) and the choice of law (what state’s law applies) can be equally important. You need to know where you will have to enforce your rights under the contract and also what law will apply. Will you need to go to another state to enforce your rights? Even if not, will your local attorney have to learn the law of another jurisdiction? These are important questions when reading and negotiating your prime contract (if with the owner) or subcontract (if with the general contractor).
Read the full story...Reprinted courtesy of
The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Judgment Proof: Reducing Litigation Exposure with Litigation Risk Insurance
March 04, 2024 —
Latosha M. Ellis & Charlotte Leszinske - Hunton Insurance Recovery BlogIt is not just your imagination: verdicts are getting bigger. So-called “nuclear verdicts” have increased in size and frequency over the past decade, particularly after the COVID-19 pandemic. Litigation risk insurance is a little known, but highly effective, option meant to compliment traditional insurance products and provide additional protection for policyholders nervous about litigation exposure.
Unfortunately, it is difficult to predict the exposure presented by any particular case. Between 2020 and 2022, the median
verdict increased 95%—from $21.5 million to $41.1 million. In
2022, a jury handed down a verdict worth $7.3 billion for injury to a single plaintiff. Even if an injury or loss is minor, juries have shown that they are willing to penalize corporate defendants with punitive damages that significantly exceed the award of compensatory damages. With such uncertainty and millions (if not billions) at stake, companies can reduce risk with litigation risk insurance.
Three key types of litigation risk insurance include: (1) punitive wrap insurance, (2) adverse judgment insurance, and (3) judgment preservation insurance.
Reprinted courtesy of
Latosha M. Ellis, Hunton Andrews Kurth and
Charlotte Leszinske, Hunton Andrews Kurth
Ms. Ellis may be contacted at lellis@HuntonAK.com
Ms. Leszinske may be contacted at cleszinske@HuntonAK.com
Read the full story...
Real Estate & Construction News Roundup (1/10/24) – New Type of Nuclear Reactor, Big Money Surrounding Sports Stadiums, and Positivity from Fannie Mae’s Monthly Consumer Survey
February 05, 2024 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogIn our latest roundup, the commercial real estate market poses a risk to financial stability, New York City moves towards net-zero building emissions, workers at several Los Angeles area hotels tentatively agree to a new contract, and more!
Read the full story...Reprinted courtesy of
Pillsbury's Construction & Real Estate Law Team
Final Rule Regarding Project Labor Agreement Requirements for Large-Scale Federal Construction Projects
January 29, 2024 —
Aaron C. Schlesinger & Julia Loudenburg - Peckar & Abramson, P.C.Beginning on January 22, 2024, in compliance with President Biden’s February 4, 2022 Executive Order, 14603, federal construction projects with a total estimated cost of $35 million are required to utilize a project labor agreement (“PLA”) unless the contracting agency grants an exception. The Federal Register estimates that this rule will impact approximately 119 IDIQ contracts each year; these contracts have an average award value of about $114 million.
The White House claims the PLAs will improve projects by:
- Eliminating project delays from labor unrest, such as strikes;
- Creating dispute resolution procedures and cooperation for labor-management disputes, such as those over safety;
- Including provisions “to support workers from underserved communities and small businesses”;
- Helping to create a steady pipeline of workers for federal projects; and
- Promoting competition on government contracts so that all builders, even those who are non-union, can bid on jobs that require a PLA.
Read the full story...Reprinted courtesy of
Aaron C. Schlesinger, Peckar & Abramson, P.C.Mr. Schlesinger may be contacted at
aschlesinger@pecklaw.com
Navigating the Construction Burrito: OCIP Policies in California’s Construction Defect Cases
November 16, 2023 —
Alexa Stephenson & Ivette Kincaid - Kahana FeldIn the early 2000’s, Owner-Controlled Insurance Programs (OCIP) or WRAPS, were traditionally used in large commercial projects of over $50 million in construction costs. As construction defect lawsuits became more prevalent, subcontractors found themselves unable to meet the insurance requirements of their contracts with developers and general contractors because they could not find insurance companies that were willing to insure the risk. This presented a problem for developers and general contractors and left them with no option but to look into new insurance products that would insure them and all subcontractors who worked on the project. OCIPs became in some instances the only insurance option for developers, general contractors, and subcontractors to build single-family or multi-family projects in California and other western states.
OCIPS or WRAPS, often likened to the layers of a savory burrito, offer both enticing benefits and potential pitfalls. Just as a burrito’s ingredients can harmonize or clash, OCIP policies can shape the outcome of legal battles, impacting contractors, developers, and insurers alike.
Pros – Savoring the OCIP Burrito:
1. Wrapped Protection: Much like a well-folded burrito envelops its contents, OCIP policies offer comprehensive coverage for construction projects. Developers, general contractors, and subcontractors find comfort in knowing that their liability risks are bundled into a single policy, ensuring all enrolled parties have coverage in the event of a claim.
Reprinted courtesy of
Alexa Stephenson, Kahana Feld and
Ivette Kincaid, Kahana Feld
Ms. Stephenson may be contacted at astephenson@kahanafeld.com
Ms. Kincaid may be contacted at ikincaid@kahanafeld.com
Read the full story...
Clean Energy and Conservation Collide in California Coastal Waters
March 19, 2024 —
Nadia Lopez & Josh Saul - BloombergTwo of President Joe Biden’s biggest priorities — conservation and the switch to clean energy — are colliding in the ocean off California’s quiet Central Coast.
Located halfway between San Francisco and Los Angeles, Morro Bay boasts a rich ecosystem of fish, otters and migrating whales that the Indigenous Chumash people want to protect with a
new marine sanctuary. But 20 miles (32 kilometers) out, developers plan some of the West Coast’s
first offshore wind farms, where 1,100-foot-tall turbines (335 meters) tethered to the seabed will help California cut its carbon emissions.
One US government agency appears poised to approve the sanctuary. Another
already leased 376 square miles of ocean for wind development, just outside the sanctuary’s boundaries. Now, a fight is brewing over whether the scenic bay itself should be left out of the sanctuary, to give undersea power cables from the wind farms a place to come onshore.
Reprinted courtesy of
Nadia Lopez, Bloomberg and
Josh Saul, Bloomberg Read the full story...
More Clear, But Not Yet Crystal: Virginia Amends its Prompt Payment Law and Legislation Banning “Pay-If-Paid Clauses in Construction Contracts Effective July 1, 2023
November 16, 2023 —
Hanna Lee Blake - ConsensusDocsThe Virginia General Assembly has joined a minority of jurisdictions that ban pay-if-paid clauses in construction contracts on public and private projects. Senate Bill 550 went into effect applying to contracts executed after January 1, 2023, and most recently has been amended effective July 1, 2023. This update highlights the recent amendments to Virginia’s prohibition against pay-if-paid provisions, of which owners and contractors should be aware to ensure that their contracts comply with developing law in the Commonwealth.
Recap on Senate Bill 550
On April 27, 2022, the Virginia General Assembly passed Senate Bill 550, which amended Virginia Code §§ 2.2-4354 and 11-4.6, which govern both public and private sector contracts. In short, SB 550 (as the bill is commonly known) prohibited pay-if-paid clauses, and established fixed deadlines for the payment of invoices on private projects. Previously, Virginia’s Prompt Payment Act only applied to public projects.
Read the full story...Reprinted courtesy of
Hanna Lee Blake, Watt TiederMs. Blake may be contacted at
hblake@watttieder.com
Congratulations to BWB&O’s 2024 Southern California Super Lawyers!
February 05, 2024 —
Dolores Montoya - Bremer Whyte Brown & O'Meara LLPBWB&O is excited to announce that Partners Nicole Whyte, Keith Bremer, John Toohey, and Tyler Offenhauser have been selected in the 2024 Southern California Super Lawyers list as Super Lawyers for their work in Business Litigation, Family Litigation, Personal Injury Litigation, and Construction Litigation. To read Super Lawyers’ digital publication, please
click here.
Super Lawyers is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. The objective of Super Lawyers’ patented multiphase selection process is to create a credible, comprehensive, and diverse listing of outstanding attorneys that can be used as a resource for attorneys and consumers searching for legal counsel. Please join us in congratulating Nicole, Keith, John, and Tyler on achieving this level of recognition!
Read the full story...Reprinted courtesy of
Dolores Montoya, Bremer Whyte Brown & O'Meara LLP