A Termination for Convenience Is Not a Termination for Default
April 22, 2024 —
David Adelstein - Florida Construction Legal UpdatesA termination for convenience is NOT a termination for default. They are NOT the same. They should NOT be treated as the same. I am a huge proponent of termination for convenience provisions because sometimes a party needs to be able to exercise a termination for convenience, but the termination is not one that rises to a basis for default. However, exercising a termination for convenience does not mean you get to go back in time and convert the termination for convenience into a termination for default. It does not work like that. Nor should it.
An opinion out of the Civilian Board of Contract Appeals – Williams Building Company, Inc. v. Department of State, CBCA 7147, 2024 WL 1099788 (CBCA 2024 – demonstrates a fundamental distinction between a termination for convenience and a termination for default, i.e., that you don’t get to conjure up defaults when you exercise a termination for convenience:
Because a termination for convenience essentially turns a fixed-price construction contract into a cost-reimbursement contract, allowing the contractor to recover its incurred performance costs, the resolution of this appeal will involve identifying the total costs that [Contractor] incurred in performing this contract before [Government] terminated it for convenience. Since [Government] terminated the contract for convenience rather than for default, it no longer matters whether, in the past,[Contractor] acted intentionally in overstating the amount of its incurred costs or committed a contract breach. Ultimately, as permitted in response to a termination for convenience, [Contractor] will recover those allowable costs that [Contractor]establishes it incurred in performing the contract.
Williams Building Company, supra.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Real Estate & Construction News Roundup (11/8/23) – New Handling of Homelessness, Decline in Investments into ESG Funds, and Shrinking of a Homebuyer’s Dollar
December 11, 2023 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogOur latest roundup includes two large flood control projects in New Jersey, how residential REITs could benefit from higher interest rates, how the downfall of WeWork could cause expansive collateral damage, and more!
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Pillsbury's Construction & Real Estate Law Team
What ‘The Curse’ Gets Wrong About Passive House Architecture
April 02, 2024 —
Teresa Xie - BloombergIn the fifth episode of Showtime’s The Curse, two potential buyers are touring a boutique house in Española, a soon-to-be gentrified Santa Fe neighborhood when one of them makes a remark about the temperature. “Sorry, can I get a water? It’s just really hot in here,” he says, airing out his sweat-stained shirt. The quirky home’s architect-slash-developer, played by Emma Stone, says, “Sure!” and without skipping a beat, continues to explain the virtues of her passive house design: The home functions like a thermos, with no need for air conditioning — unless any air escapes the house. Then it takes five to seven hours for the room to recover.
Owning a passive house sounds like a nightmare, right? If you’re buying a one-of-a-kind, mirror-clad spec house from Stone and co-star Nathan Fielder, it may well be. On The Curse, the two play a do-gooder couple attempting to make an HGTV series (with Benny Safdie) about turning regular houses into carbon-neutral passive homes.
Odd things happen to Stone and Fielder over the show’s first season: trouble with the laws of gravity, the trials of a failing marriage and a literal curse from a small child. But the weirdest might be the show’s portrayal of passive house design, an energy-efficient design standard that has been around since the 1970s. Passive building, which has its origins in Europe, relies on advanced construction methods to seal a structure in an airtight envelope, thereby reducing energy consumption for heating and cooling by as much as 75%.
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Teresa Xie, Bloomberg
Jason Feld Awarded Volunteer of the Year by Claims & Litigation Management Alliance
April 15, 2024 —
Linda Carter - Kahana FeldOn April 3, 2024, Kahana Feld’s Co-Founding Partner, Jason Feld was honored by the Claims & Litigation Management Alliance (CLM) with the Inaugural Volunteer of the Year award.
The CEO of CLM, Ronna Ruppelt stated, “The new CLM Volunteer of the Year award honors dedicated members who passionately serve the CLM community. Jason’s service spans over a decade as both the President and Director of Events for the Orange County Chapter. Under his guidance, this chapter has flourished – not only educating and connecting the CLM community but rallying members to give back to the local community through service events in the process. Jason is also a frequent writer, speaker, and contributor for CLM events, and we are proud to honor him as our inaugural CLM Volunteer of the Year.”
Mr. Feld is a renowned nationwide construction claims leader who actively speaks at industry events. He serves as panel counsel for many prominent insurance carriers and provides personal counsel for multiple national and regional builders, developers, and contractors. With his vast experience and expertise, Mr. Feld is a trusted authority in the field and is highly regarded for his legal representation.
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Linda Carter, Kahana FeldMs. Carter may be contacted at
lcarter@kahanafeld.com
Key Economic & Geopolitical Themes To Monitor In 2024
January 16, 2024 —
Global Insights Center Staff - The HartfordSlowing US Economic Growth and Flattening Interest Rates
Growth in the first half of 2023 averaged approximately 2.0%, driven mainly by private sector investments outside of the residential housing sector, government spending, and strong consumer demand. In 2024, The Hartford’s Global Insights Center is expecting investments and government spending to continue and may support growth in the year. However, consumer health may start to weaken due to elevated leverage, higher interest rates, and sticky inflation.
Since the Federal Reserve began to increase interest rates, consumer activity and household finances have not been tremendously affected. However, as revolving interest rates (credit card loans) continue to reset that may change, especially since household savings rates fell below pre-pandemic levels and may affect consumer demand.
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Global Insights Center Staff, The Hartford
Certificates of Merit: Is Your Texas Certificate Sufficient?
January 22, 2024 —
Gus Sara - The Subrogation StrategistIn Eric L. Davis Eng’g, Inc. v. Hegemeyer, No. 14-22-00657-CV, 2023 Tex. App. LEXIS 8899, the Court of Appeals of Texas (Court of Appeals) considered whether the plaintiffs’ certificate of merit, in support of their professional malpractice claim against the defendant engineers, adequately set forth the experience and qualifications of the expert who submitted the certificate. The defendants filed a motion to dismiss, alleging that the certificate of merit was inadequate because it failed to establish that the expert practiced in the same specific areas as the defendants in relation to the work at issue. The lower court denied the defendants’ motion. The Court of Appeals affirmed the lower court’s decision, finding that there was sufficient information for the lower court to have reasonably found that the plaintiffs’ expert practiced in the same area as the defendants.
In Hegemeyer, the plaintiffs sued Eric L. Davis Engineering, Inc. (Davis) and Kenneth L. Douglass (Douglass), alleging improper design of their home’s foundation. The plaintiffs retained Davis to design and engineer the home and Douglass prepared the plans for the home. The plans called for the installation of post-tension cables in the home’s foundation. The plaintiffs alleged that the foundation design was improper and brought professional malpractice claims against Davis and Douglass.
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Gus Sara, White and WilliamsMr. Sara may be contacted at
sarag@whiteandwilliams.com
Aarow Equipment v. Travelers- An Update
January 16, 2024 —
Christopher G. Hill - Construction Law MusingsPreviously here at Musings, I discussed the application of pay if paid clauses and the Miller Act. The case that prompted the discussion was the Aarow Equipment & Services, Inc. v. Travelers Casualty and Surety Co. case in which the Eastern District of Virginia Federal Court determined that a “pay if paid” clause coupled with a proper termination could defeat a Miller Act bond claim. However, as I found out a couple of weeks ago at the VSB’s Construction Law and Public Contracts section meeting, the 4th Circuit Court of Appeals reversed and remanded this case in an unpublished opinion (Aarow Equipment & Services, Inc. v. Travelers Casualty and Surety Co.)
In it’s opinion, the 4th Circuit looked at some of the more “interesting” aspects of this case. One of these circumstances was that Syska (the general contractor) directed Aarow to construct sedimentary ponds and other water management measures around the project (the “pond work”), which both agreed was outside of the scope of the work defined in their subcontract. Syska asked that the government agree to a modification of the prime contract and asked Aarow to wait to submit its invoice for the pond work until after the government issued a modification to the prime contract and Syska issued a change order to the subcontract.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Higgins, Hopkins, McLain & Roswell Recognized in 2024 Best Law Firm® Rankings
November 16, 2023 —
David M. McLain – Colorado Construction Litigation BlogWe are thrilled to announce that Higgins, Hopkins, McLain & Roswell, LLC (“HHMR”) has been recognized in the 2024 Best Law Firm® rankings. Our firm has been placed in Metro Tier 2 in Colorado for Construction Law, a testament to our unwavering commitment to providing top-tier legal services.
At HHMR, we pride ourselves on our expertise in construction law and the litigation of construction-related claims. Our team of dedicated attorneys is well-versed and experienced in tort, contract, property, and general casualty litigation. This recognition by Best Lawyers affirms our dedication to serving our clients selflessly and to the best of our ability.
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David McLain, Higgins, Hopkins, McLain & RoswellMr. McLain may be contacted at
mclain@hhmrlaw.com