By Bruce Jervis
Claim sponsorship and settlement agreements are a vital tool for administering and resolving claims. They facilitate the consolidation of multiple, interrelated claims of a prime contractor and its subcontractors against the project owner. The claims can then be resolved in a single forum. Yet, claim sponsorship agreements can also raise difficult issues.
Under a typical claim sponsorship agreement, the prime contractor prosecutes its own claims and the claims of its subcontractors against the project owner. The prime contractor pays for and controls the prosecution of the consolidated claims, with total discretion to agree on a settlement amount with the owner. The subcontractors agree to accept their portion of the recovery, if any, and nothing more. ... Read more.
Featured in this Week’s Construction Claims Advisor:
- Court Calculates Sub’s Pro Rata Share of Sponsored Claim Settlement
- Contractor Waived Pay-if-Paid Clause by Making Progress Payments
- Background Investigation of Rejected Low Bidder Upheld
By Steve Rizer
One of the most common administrative mistakes contractors make that give rise to claims and disputes is failing to give their contracts a thorough read through, Navigant Construction Forum Executive Director James Zack told a group of professionals attending a webinar that WPL Publishing held last week. During the 90-minute event, Zack and Navigant Consulting Director Philip Spinelli summarized 20 of the most frequent administrative mistakes among contractors and owners and then offered their advice for avoiding each of those problems.
“During bidding, [contractors are] focusing on drawings, specs, and technical details, and they often fail to read the entire contract,” Zack said. “A lot of times when I’ve represented a contractor and found out they didn’t … read the contract during the bidding process, their [excuse was], ‘Well, it’s a standard city contract, man. We’ve done a dozen of these before.’ As a result, they don’t see the changes that have been made to previous standard language, or they don’t recognize new, special provisions that have been imposed. They don’t understand the implications and the impacts of this new language. The result is they may not plan or budget for compliance with these new contract requirements.” ... Read more.
By Steve Rizer
Are changes to green building policies coming to your area sometime in the not-too-distant future? To help answer this question for you, ConstructionPro Week has compiled a list of 74 bills relating to green buildings that state and congressional legislators have introduced this year. Proposals address a wide variety of issues, ranging from energy audits at certain federal facilities to the formation of a Nonresidential Building Energy Retrofit Financing Program in California to the creation of a “green walls” tax abatement in New York. The list includes the following eight congressional measures and 66 state bills (with summaries of and hyperlinks for the state bills being accessible to ConstructionPro Network members. To join ConstructionPro Network, click here): ... Read more.