Construction Law | Legal issues, news, and regulations concerning the construction industry

Factor May be Liable for Diversion of Lien Law Trust Funds

Jan 01 2007

Caristo Constr. Corp. v. Diners Fin. Corp., 21 N.Y.2d 507 (1968)

In Caristo Constr. Corp., a general contractor paid a subcontractor who then turned the money over to a factoring corporation. The factor failed to file assignment of accounts or a “Notice of Lending” and failed to deposit the general contractor’s checks in depository in trust. In so doing, the factor participated in diversion of statutory trust funds, despite having returned to the subcontractor simultaneously with the payments “advances” equal to the payments. The general contractor, who was forced to make payment after the subcontractor became insolvent, prevailed in a suit as subrogee against the factor.

Waiver of Lien Rights Requires Clear, Certain and Unequivocal Evidence

Jan 01 2007

Boise Cascade Corp. v. Distinctive Homes, Inc., 67 Wash. 2d 289, 407 P.2d 452 (1965)

This case involves actions to foreclose on materialmen’s liens by Boise for materials supplied to Distinctive, a building company owned by the landowners, for the construction of two homes. Distinctive claimed that Boise agreed to waive its lien rights when it accepted two promissory notes. Boise, however, claimed that the two notes were merely taken as additional security when it agreed to withhold filing the liens if certain timely payments were made.

Proper Measure of Damages from Defaulting Contractor is Cost of Completion or Necessary Repairs

Jan 01 2007

525 Main St. Corp. v. Eagle Roofing Co., 168 A.2d 33, 34 N.J. 251 (1961)

In this case, the plaintiff property owner, contracted with the defendant for repairs to his roof and a five-year guarantee against leaks with a promise to repair. During the five years, the defendant disputed the scope of his responsibility and stopped performing repairs. The trial court found in favor of the plaintiff, concluding that the defendant had breached, but awarded nominal damages. The plaintiff appealed on the issue of damages.

The defendant argued that the damages should properly be calculated as the difference in value of the entire structure with the defective roof and the value of the building as if the contract had been fully performed. The court disagreed and found that in the construction context, the cost of repairs or the cost of replacement is the appropriate measure of damages and not a measurement made with reference to the value of the building as whole.

K&LNG’s Arbitration World, Summer 2006

Jul 01 2006

By Ian Meredith, Linda A. Kent, Peter R. Morton, Kelly D. Talcott, Matthew E. Smith, Clare Tanner, Sarah A. Munro.

Arbitration World, a publication of Kirkpatrick & Lockhart Nicholson Graham, highlights the significant developments and issues in international arbitration that matter to in-house counsel and company executives with responsibility for dispute resolution.

Welcome to the second edition of “Arbitration World,” a publication from Kirkpatrick & Lockhart Nicholson Graham LLP’s Arbitration Group. “Arbitration World” aims to highlight significant developments and issues in international arbitration that matter to in-house counsel and company executives with responsibility for dispute resolution.

In this significantly expanded edition:

We look back at our International Arbitration Seminar held at Claridge’s, London in March this year and look forward to our forthcoming International Arbitration Webinar programme in the Autumn;
We examine some practical considerations in relation to arbitration clauses in insurance contracts, consider the issue of whether an arbitrator has authority to grant rescission of the contract as a remedy in arbitration and offer some thoughts on ways to deal with the tricky area of arbitration of multiparty disputes with particular reference to the construction sector;

Form to Formation

May 01 2006

This article by Preston Gates & Ellis Anchorage partner Paul L. Davis appears in the May 2006 edition of Alaska Business Monthly. It discusses how the search for front-end efficiencies can derail construction project agreements:

In all but the smallest construction projects, written project agreements are a necessity and, depending on the complexity of the project and number of parties involved, can evolve from a few pages to many. When anticipating construction projects, parties often spend more time visualizing the project itself, overlooking the time or money necessary to fully develop a new project agreement. The result is the frequent use of standard form agreements that are modified, many times by the parties themselves, to fit the circumstances of the new project’s specifications. While this may create efficiencies, project owners may find themselves more disadvantaged by the use of standard forms than contractors and designers.

View the full article here.

The “Greening” of New York

Jan 17 2006

By Michael R. Gordon, Ruvym D. Gilman, Kathryn Plunkett and contribution by John R. Nolon, professor at the Pace University School of Law and counsel to its Land Use Law Center.

This article appeared in the New York Law Journal on January 17, 2006.

Lawyers practicing in the design and construction fields cannot ignore emerging trends, and “green construction”— the use of environmentally conscious design, construction, and operation methods to create sustainable commercial and residential buildings—is an emerging trend. For New York construction lawyers, it is an important trend because New York is leading the nation in green construction. The number of green buildings and green construction projects underway in New York is steadily increasing. Completed green buildings in New York City include the Solaire residential buildings in Battery Park City and Four Times Square. Still to be completed are the Hearst Magazine Building and the Bank of America Tower near Bryant Park, to name a few.

Why the focus? There are a number of reasons, including a concern for energy efficiency and a growing environmental consciousness, but the most notable cause is no doubt the adoption of mandatory green construction laws and guidelines and the creation of financial incentives on municipal, state and federal levels. . . .

Read the full article here.

K&LNG’s Arbitration World (U.S. Version), Winter 2005/2006

Jan 01 2006

By Thomas E. Birsic, Ian Meredith, Linda A. Kent, Peter R. Morton, Kelly D. Talcott, Matthew E. Smith and Clare Tanner.

Arbitration World highlights the significant developments and issues in international arbitration that matter to in-house counsel and company executives with responsibility for dispute resolution.

Welcome to the first edition of “Arbitration World,” a publication from Kirkpatrick & Lockhart Nicholson Graham LLP’s Arbitration Group. “Arbitration World” aims to highlight significant developments and issues in international arbitration that matter to in-house counsel and company executives with responsibility for dispute resolution.

In this issue we will be covering some recent decisions of the European Court of Justice which serve to highlight the benefits of agreements to arbitrate, and some English case law developments including a House of Lords decision re-affirming the English court’s noninterventionist approach to arbitration.

We look at the growing importance of Bilateral Investment Treaties (BITs) and how they might be used not only in claims by investors against governments of developing nations, but also in claims against Western States.

K&LNG’s Arbitration World (U.K. Version), Winter 2005

Dec 01 2005

By Ian Meredith, Linda A. Kent, Peter R. Morton, Kelly D. Talcott, Matthew E. Smith and Clare Tanner.

Arbitration World highlights the significant developments and issues in international arbitration that matter to in-house counsel and company executives with responsibility for dispute resolution.

Welcome to the first edition of “Arbitration World,” a publication from Kirkpatrick & Lockhart Nicholson Graham LLP’s Arbitration Group. “Arbitration World” aims to highlight significant developments and issues in international arbitration that matter to in-house counsel and company executives with responsibility for dispute resolution.

In this issue we will be covering some recent decisions of the European Court of Justice which serve to highlight the benefits of agreements to arbitrate, and some English case law developments including a House of Lords decision re-affirming the English court’s noninterventionist approach to arbitration.

We look at the growing importance of Bilateral Investment Treaties (BITs) and how they might be used not only in claims by investors against governments of developing nations, but also in claims against Western States.

Be Aware of Construction Law Developments

Apr 13 2005

The building boom could hit many parties in the head.

By K&LNG attorneys Michael R. Gordon and Daniel J. Doron

New York Law Journal: Trends in Real Estate and Title Insurance
April 11, 2005

We are in the midst of one of the great construction booms in recent history. There are over 75 high-rise buildings under construction in New York City, with dozens of others being renovated or reconstructed. The Freedom Tower, the Hearst Magazine Building, the Atlantic Yards Project in Brooklyn, and 505 Fifth Avenue are all underway. An overhaul of the Hudson Rail Yards on the Lower West Side is imminent, as the New York Sports and Convention Center or as another major redevelopment project. In such an environment, buyers and sellers of construction services must be mindful of recent developments in construction law. This article highlights a few of those developments.

View the full article here.
Posted with permission.