Summary: Under the Spearin doctrine, now approaching its centennial, a public owner makes an implied warranty in every construction contract that the government’s drawings and specifications are adequate for the contractor to perform the work … [Read more...]
Contractor’s right to cure before being terminated for cause. Milton Regional Sewer Authority v. Travelers Casualty and Surety Co. United States Court of Appeals for the Third Circuit (2016), by Hugh Anderson
Summary: The contractor on a public works project in Milton, Pennsylvania, struggled to perform adequately in the early stages of the work. The frustrated owner suspended the work, and in response the contractor offered in writing to correct any … [Read more...]
Does termination for convenience preclude the owner from entitlement to liquidated damages? Old Colony Construction LLC v. Town of Southington. Supreme Court of Connecticut (2015), by Hugh Anderson
Summary: A termination for convenience typically results in the contractor walking away from the project with payment for work rendered, and no concerns about further liability to the owner. The EJCDC standard termination for convenience clause does … [Read more...]
Owner’s right to withhold retainage during dispute. FTR International, Inc. v. Rio School District. California Court of Appeals (2015), by Hugh Anderson
Summary: The contractor, FTR, constructed a school under a $7.34 million contract with the Rio School District. The contract required retainage of 10%. When the work was completed and the school opened for classes, the school district was holding … [Read more...]
Structural engineer’s liability to homeowners’ association for structurally unsafe building. Pointe at Westport Harbor Homeowners’ Association v. Engineers Northwest, Inc. Court of Appeals of Washington (2016), by Hugh Anderson
Summary: Many states recognize some version of the economic loss rule, which provides that losses that are merely economic in nature must be recovered in a breach of contract action, not in tort (negligence). Breach of contract claims generally … [Read more...]
Jarlstrom v. Oregon Board of Examiners for Engineering and Land Surveying Board, by Arthur Schwartz
An Oregon man who was investigated and fined by a state board for unlicensed practice of engineering has filed a lawsuit in federal court alleging the state's definition of an engineer violates the First Amendment. Mats Jarlstrom, 56, was fined $500 … [Read more...]
Balfour Beatty Infrastructure, Inc. v. Rummel, Klepper & Kahl, LLP, by Arthur Schwartz
In Balfour Beatty Infrastructure, Inc. v. Rummel Klepper & Kahl, LLP, the Maryland Court of Appeals confirmed that the Economic Loss Rule is alive and well in Maryland. NSPE and other design professional organizations filed a “friend of the … [Read more...]
Issue: Is a contractor’s deliberate decision to install flooring, despite knowing that the underlying slab was still emitting a high level of moisture, an “occurrence” that is covered under a commercial general liability insurance policy? Navigators Specialty Insurance Company v. Moorefield Construction, Inc. Court of Appeal of California, Fourth Appellate District (2016), by Hugh Anderson
Summary: Construction of a Best Buy store in Visalia, California. Based on test results, the contractor, Moorefield, knew that the concrete floor was emitting high amounts of moisture at the time that vinyl and carpet floor tiles were ready to be … [Read more...]
Issue: Contractual allocation of risk regarding underground facilities. J.F. Allen Corporation v. Sanitary Board of City of Charleston, West Virginia. Supreme Court of Appeals of West Virginia (2016), by Hugh Anderson
Summary: $5 million municipal sewer project. J.F. Allen, the contractor, brought a breach of contract claim against the owner, alleging that during construction the contractor encountered 122 unmarked or mismarked underground utilities, resulting in … [Read more...]
Issue: Contractor’s obligation to comply with recommendations in a geotechnical report, and entitlement to rely on a change order issued in response to a request for clarification. Maines Paper & Food Service, Inc. v. The Pike Co., Inc. Appellate Division, Third Department, New York (2016), by Hugh Anderson
Summary: The contractor, The Pike Co., constructed a supermarket in Ithaca, New York. After completion the floor of the new building settled substantially. The owner, Maines, sued the contractor for breach of contract and breach of warranty. The … [Read more...]
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