Volume: 6, Issue: 16 - 04/21/2017

 

Every young student comes across those four words, either from being assigned John Steinbeck’s novel or – for the diehard English student – from reading Robert Burns’ poem “To a Mouse,” in which he reflects on the dire consequence of his having turned up a field mouse’s nest with his plough. “The best laid plans of mice and men,” often go awry.

 

Enter the construction contract (I know you were wondering where this was going). Everyone on the planet knows that construction projects are not static and that even modest projects undergo changes throughout the building phase. The consequences of changes can be dramatic, and most construction contracts lay out plans for the administration of changes and the negotiation and documentation of the terms of change orders with respect to the three important attributes of construction: time, money, and the details of work itself. A sufficiently robust change order clause represents the “best laid plans” for dealing with change orders. And as we have learned from Burns’ poor mouse, these plans often go awry. Read more


Volume: 6, Issue: 15 - 04/14/2017

 

By Bruce Jervis

 

General or prime contractors have always been enamored with indemnification clauses. Place one in every subcontract and if there is any injury on the project the subs will ultimately be liable. The prime contractor will be exonerated even if it shared responsibility for a safety hazard. Read more.


Volume: 6, Issue: 14 - 04/07/2017

 

This article started out as a review of a schedule specification clause in a recently updated standard form document.  In the process of getting comments on the form from the author’s local contacts, I received instead a range of comments on the use, or non-use, of schedules, and blaming specs for being either too detailed or non-existent.  As a reader of ConstructionPro Week, you may have noticed we often advocate for active use of schedules on construction projects.  Larger and more complex projects can benefit from the use of critical path method (CPM) scheduling software.

 

This past December, the ConsensusDocs coalition announced updates to more than a dozen of its standard form contracts, some released this past December and others in early 2017 (see ConstructionPro Week Vol. 5 – Issue 48, 12/16/2017).  ConsensusDocs® 200, Standard Agreement and General Conditions Between Owner and Constructor received an important update to the project schedule clause.  Article 6.2, Schedule of the Work, now requires the use of critical path method (CPM) scheduling concepts, including “…  (a) a graphical representation of all activities and events, including float values that will affect the critical path of the Work, and (b) identifies dates that are critical to ensure the timely and orderly completion of the Work.”  Read more.


Volume: 6, Issue: 13 - 03/31/2017

 

By Bruce Jervis

 

It’s a common standoff when there is a final payment and close-out for construction work. It occurs between owner and contractor as well as contractor and subcontractor. The payer doesn’t want to pay until it has received a waiver and release. The payee doesn’t want to waive its rights until it has received payment. There must be ways to handle this situation without a face-to-face “closing.” In some states, the mechanic’s lien statutes expressly address the issue. Read more.


Volume: 6, Issue: 11 - 03/17/2017

 

By Bruce Jervis

 

Second place bidders frequently look for ways to displace low bidders. The most common tool is a protest that the low bid is not responsive to the solicitation or the low bidder is not responsible. Two California contractors took the challenge to another level and the case went to the state’s highest court. Read more.


Volume: 6, Issue: 10 - 03/10/2017

 

Last week in our blog highlights, we announced the availability of a construction productivity survey by the McKinsey Global Institute (MGI).  This week we take a closer look at the survey and the 168-page report. The survey was international in scope involving more than 75 MGI employees from eight offices worldwide. In addition, the MGI staff consulted with more than 45 internationally known productivity experts, consultants, academics, economists, researchers and practitioners, including AGC’s Ken Simonson, Lean Construction Institute founders Greg Howell and Greg Ballard, productivity expert John Borcherding of the University of Texas and Stanford’s Paul Teicholz. 

 

MGI surveyed 5,000 construction-industry CEOs representing asset owners, engineering and construction firms, suppliers and other institutions such as construction consulting firms, academics, and industry associations. Participants were asked to rank the relative importance of root causes of low productivity, and indicate what their companies were doing to address them.  Read more.


Volume: 6, Issue: 9 - 03/03/2017

 

By Bruce Jervis

 

Individuals involved in civil litigation are entitled to represent themselves, to appear pro se. They are not required to hire a licensed attorney in order to participate in the judicial process. What happens, however, when a party to litigation is a group of individuals or an organized business entity? Can a non-attorney member or proprietor represent the broader entity? Read more


Volume: 6, Issue: 7 - 02/17/2017

 

 By Bruce Jervis

 

Can a public contract clause bind a contractor even when the clause is not stated or referenced in the contract? The answer is yes, if the clause is considered mandatory. Lower-level employees cannot alter the procurement process by accidentally omitting important clauses. Read more.


Volume: 6, Issue: 6 - 02/10/2017

 

Last week’s article on “Pay-if-Paid” clauses was one of our most-read construction law articles in recent weeks. Thirteen readers weighed in with their responses, from a simple “Read and understand your contract” to a couple of 200+ word commentaries. In short, from the general contractor’s perspectives, GC’s feel they are not banks on hand to finance the project, and if the owner doesn’t pay them, they shouldn’t pay the contractor. Subcontractors, on the other hand, often are the ones taking the most risk and have the most out-of-pocket expenditures. Read more.


Volume: 6, Issue: 5 - 02/03/2017

 

By Bruce Jervis

 

The enforceability of “pay-if-paid” clauses in subcontracts has been litigated extensively. The clauses are controversial because they purport to shift the risk of project owner nonpayment from the prime contractor, which has a contract with the owner, to subcontractors, which do not. Many feel this is unfair and reflects nothing more than the superior economic leverage of prime contractors over their subs. Read more.


 

 

 


CONSTRUCTION CLAIMS ADVISOR
VOL. 15   ISSUE 7 - APRIL 2017

 

General or prime contractors have always been enamored with indemnification clauses. Place one in every subcontract and if there is any injury on the project the subs will ultimately be liable. The prime contractor will be exonerated even if it shared responsibility for a safety hazard. Read more.


 

A contractor is not entitled to redesign a public project on the basis of perceived deficiencies. Repeatedly submitting nonconforming designs outside of the contract requirements puts the contractor at risk for a default termination.


 

An indemnification clause in a subcontract tracked the language of a California statute. It prohibited indemnification of the prime contractor to the extent of the contractor’s active negligence, but did not prohibit indemnification entirely due to that alleged negligence.


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