By Bruce Jervis
It is well established that if a contractor wants to enforce a “pay-if-paid” clause in a subcontract, the clause must state that payment by the project owner for the subcontractor’s work is a condition precedent to the contractor’s obligation to pay the sub for that work.
In recent years, an additional element has evolved from the case law. Contractors are advised to include language where the subcontractor acknowledges it is relying solely on the creditworthiness of the project owner and assumes the risk of owner nonpayment. ... Read more.
Featured in this Week’s Construction Claims Advisor:
- Contractor Did Not Misrepresent Solvency of Owner to Subcontractor
- Acceleration Claim Not Barred by No-Damage-for-Delay Clause
- SBA Erred in Calculating Size of Affiliated Companies
By Steve Rizer
ConstructionPro Week has prepared summaries of 39 new state policies affecting America’s construction community, including Arizona’s new law for construction indemnity agreements, a measure that Illinois adopted earlier this month to raise the threshold at which public construction projects must require surety bonds, Indiana’s new “E-Verify” law, and Utah’s attempt to ensure that all preconstruction liens on a project property “are on equal footing.” All of the measures were passed into law this year. Click here to read what some of the requirements are and to access the official documents containing those requirements.
By Scott Turner
Last month, a state high court ruled that a commercial general liability (CGL) policy’s coverage for defective construction work was excluded by operation of the Performing Operations Exclusion and the Recall of Products or Work Exclusion. The court also restated its general view that the CGL policy does not cover property damage to the policyholder’s own work; it only covers property damage to other property that is not the policyholder’s work. ... Read more.
By Steve Rizer
The Construction Management Association of America (CMAA) has entered into a partnership that it considers “a way to ensure that construction management professionals meet the highest standards in a very competitive industry.”
At the core of the partnership is CMAA’s acceptance into ABET, an accrediting agency for technical education. CMAA thus becomes an ABET member society with lead responsibilities for construction management. As an ABET member society, CMAA will hold seats on the ABET accreditation commissions and have at least one voting representative on the ABET Board of Directors. As the lead society for construction and management, CMAA has the ability to develop program-specific criteria for the construction-management discipline. The organization additionally will be responsible for recruiting and selecting program evaluators to review construction management programs. ... Read more.