Construction and Engineering Lawyers & Attorneys : K&L Gates Law Firm : Financing, Development, Dispute Resolution, Government Contracting

U.S. Fid. & Guar. Co. v. E. Contractors, Inc., 2008 WL 190758 (D. Mass. Jan. 15, 2008)

In this case, the Federal District Court for the District of Massachusetts issued an order on a Motion to Intervene and Dissolve Attachment.  The motion to intervene was allowed and the petition for dissolution was allowed in part and denied in part.  Plaintiff was an issuer of security bonds and defendant was a construction company.  Plaintiff issued a series of bonds to secure defendant’s performance on several construction projects.  Defendant defaulted on the projects and subsequently plaintiff successfully secured an ex parte attachment of four of defendant’s properties.  Another insurance company that had also entered into surety agreements with the defendant previously secured a judgment against the defendant for $8,342,233.27.  This judgment was never satisfied due to defendant’s insolvency.  The insurance company claimed an interest in the attached properties. Continue Reading...

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Ins. Co. of New York v. Central Mut. Ins. Co., 850 N.Y.S.2d 56 (N.Y. App. Div. 2008)

In this case, the First Department examined cross-motions for summary judgment in relation to contractual indemnification.  Plaintiffs – the property owner and general contractor in a related personal injury action – brought this action against a subcontractor, S&S Construction Group.  Plaintiffs sought a declaration that S&S’s liability insurer, Central Mutual Insurance, was required to defend and indemnify plaintiffs in connection with the underlying action.  According to plaintiffs, the contract between the general contractor/plaintiff and S&S required S&S to obtain insurance covering plaintiffs. Continue Reading...

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Murray's Iron Works, Inc. v. Boyce, 158 Cal. App. 4th 1279 (2008)

In this case, the California Court of Appeal addressed whether the prompt payment penalty statute was properly applied against the owner and, in doing so, provided a definition for progress payments under the statute.

California requires that an owner pay its contractor any progress payment due as to which there is no good faith dispute within 30 days following receipt of a demand for payment.  If there is a good faith dispute between the owner and contactor, the owner may withhold no more than 150 percent of the disputed amount.  Any amount wrongfully withheld by the owner is subject to a penalty of 2 percent per month on the improperly withheld amount, in lieu of any interest otherwise due.  The prevailing party is also entitled to attorney’s fees and costs.  (Cal. Civ. Code § 3260.1.)  Other statutes establish similar requirements for progress payments between contractors and subcontractors (Bus. & Prof. Code § 7108.5) and for payment of retention (Cal. Civ. Code § 3260).

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Luby v. Rotterdam Square, L.P., 850 N.Y.S.2d 252 (N.Y. App. Div. 2008)

In this negligence action, plaintiff sustained injuries when he fell over a transition flare of a handicapped ramp.  That ramp had been constructed by defendant Clifford H. Quay & Sons fourteen years earlier pursuant to a contract between Quay and another defendant, Rotterdam Square.  The architectural firm that designed the plans pursuant to which the ramp was constructed was also named as a defendant.  Two issues were at stake.

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Leyden v. Spaulding & Slye Co., Inc., 2008 WL 241085 (Mass. Super. Ct. Jan. 3, 2008)

In this case the Superior Court granted an architect’s motion for summary judgment on claims brought against it by a construction worker for personal injuries sustained when the worker fell through a collapsed sump pump grate.  The defendant architect argued it was entitled to summary judgment because it owed no duty of care to the plaintiff. Continue Reading...

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Worth & Co., Inc. v. Dept. of Labor & Ind., 938 A. 2d 239 (Pa. 2007)

In this case, the Supreme Court of Pennsylvania decided the appeal of a general contractor, whose final payment was being withheld by a public school district on account of the GC’s subcontractor’s failure to pay prevailing wages to its workers.  Under the authority of regulations issued by the Department of Labor & Industry’s prevailing wage division, the Department had instructed the school district to withhold final payment from the general contractor, because workers of the subcontractor remainied unpaid following the subcontractor’s default and eventual bankruptcy. Continue Reading...

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Berish v. Bornstein, 71 Mass. App. Ct. 1101 (2007) (Unpublished)

In this unpublished decision, the Massachusetts Appeals Court addressed the implied warranty of habitability as applied to construction of a residential condominium development.  Plaintiffs, who were trustees of a condominium association, appealed from the trial court’s ruling that faulty window installation in the units was not a latent defect and that faulty chimney attachments were not a safety threat to condominium unit inhabitants.  Plaintiffs also challenged the judge’s findings that certain other claims were time-barred.  The defendants (the condominium developer, an original trustee of the condominium trust, and the general contractor) cross-appealed from the judge’s ruling on the timeliness of plaintiffs' claims for breach of the implied warranty of habitability and for negligence. Continue Reading...

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