Month: November 2010

Indemnity and Defense Obligations: Not Necessarily Absolute

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11/29/2010Lowenstein, Neil S.

Now that everyone’s had their fill of Thanksgiving food and good cheer, it’s time to get back to the old grindstone. One way to burn off those holiday calories is to exercise the old mind; hey, in my book, every calorie burned counts, not matter how you burn it! The Virginia Supreme Court recently dabbled… Read more »

Payment Bond: It’s not insurance

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11/28/2010Lowenstein, Neil S.

Many subcontractors presume that if there is a payment bond on a project they have insurance of payment from the surety, but that’s not true. A payment bond is not insurance. It only comes into play if the claim is covered by the payment bond and the claimant makes proper claim under the payment bond,… Read more »

Holiday Cheer: WKRP Old School Sitcom Humor

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11/24/2010Lowenstein, Neil S.

The holiday season is always one of the best of the year. Getting ready for turkey day reminded me (showing a bit of my age here) of an old episode of WKRP in Cincinnati, in which the radio station tried a turkey giveaway promotion, but the station owner didn’t realize turkeys (at least big domestic… Read more »

Ordinary Building Materials versus Equipment or Machinery: The Difference is Time

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11/23/2010Lowenstein, Neil S.

Following up an earlier post, the Virginia Supreme Court In Jamerson v. Coleman-Adams Construction, Inc., 280 Va. 490, 699 S.E.2d (2010) recently discussed the distinction between ordinary building materials, which are subject to Virgina’s 5-year statute of repose, and equipment or machinery, which are exempt. At issue was a specially fabricated steel platform that failed… Read more »

No License? – No Pay (Maybe)

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11/22/2010Lowenstein, Neil S.

Most states, including Virginia, have licensing requirements for contractors. Virginia’s requirements apply regardless of trade and regardless of whether the contractor is a prime contractor or one of the prime’s lower tier subcontractors. Unlike some other states, Virginia has a 3-level “class” system for contractors, based – in general – on contract value: $10,000 or… Read more »

Delays: Time can, but doesn’t alway, equal money

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11/19/2010Lowenstein, Neil S.

Time is almost always “of the essence” for construction projects. But that doesn’t necessarily mean that every delay results in monetary loss. Absent “liquidated” damage agreements (i.e., each day of day = $x.xx), damages resulting from delays have be proven. The most undisputed aspect is extended field or general conditions (i.e., the costs of running… Read more »

Pay if Paid II – Mechanic’s lien affect

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11/17/2010Lowenstein, Neil S.

Some states prohibit mechanic’s lien waivers. But not Virginia. By statute, mechanic’s lien rights can be waived in Virginia. Construction attorneys have generally (I think I correctly speak for most) presumed that meant a clear and express waiver of lien rights. However, a recent Circuit Court opinion agreed with the theory of bank counsel trying… Read more »

Controversial Contract Provisions – No Damages to Delay

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11/16/2010Lowenstein, Neil S.

Another controversial contract provision is a no damages for delay clause. Essentially, it provides that the sole remedy in a delay situation is a time extension, but no money for the delay impacts. Depending upon how the clause is written, it could go further to all time related impacts, including acceleration or disruption too. Again,… Read more »

Controversial Contract Provisions – Pay if paid

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11/15/2010Lowenstein, Neil S.

Following up an earlier theme about contracts, it occurred to me that there are various controversial contract provisions regularly used that warranted discussion. I will not say they are good or bad because, like opinions about art, such opinions are in the eye of the beholder; or in this case the party with control over… Read more »

Industry Forms: Is consensus really an advantage?

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11/12/2010Lowenstein, Neil S.

Many projects utilize industry forms such as the AIA or ConsensusDocs family of documents. The AIA family has, particularly, been an accepted “standard” in the industry for many years, and the Consensus have developed more recently as another series of alternative documents. The clear advantages of these documents are their consensus; however, that conversely is… Read more »