Articles Posted in Construction Generally

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On October 11, 2016, a panel of the U.S. Court of Appeals for the District of Columbia consisting of Judges Henderson and Kavanaugh and Senior Circuit Judge Randolph decided the case of PHH Corp. v. Consumer Financial Protection Bureau. The panel majority held that the structure of Consumer Financial Protection Bureau (CFPB), a creation of the Dodd–Frank Wall Street Reform and Consumer Protection Act (Pub.L. 111–203, H.R. 4173, commonly referred to as Dodd–Frank), was unconstitutional, in that it vested enormous power in an agency headed by a Director who cannot be adequately supervised by the President because of the five year term the Director’s serves, the lack of Congressional control over the CFPB’s funding, and the fact that the President can only remove the Director “for cause” even though in theory the President should have more authority over such officials. The panel concluded that this structure thus violates the U.S. Constitution’s separation of powers.

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The Federal Emergency Management Agency (FEMA) and New York City have announced that they will be working together to update the City’s flood flood-300x200maps. The need for updating FEMA’s flood maps has become more than apparent since at least 2005. Cities like New York, Houston, and Baton Rouge, which have been devastated by floods in recent years, are all too familiar with the shortcomings of FEMA’s flood maps. New York City, in particular, suffered in the wake of Hurricane Sandy, when approximately 80% of those who experienced flood damage did not have flood insurance.

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With so many extracontractual parties often involved in work that necessarily implicates others in construction, the economic loss doctrine can present serious hurdles to a harmed party’s recovery of damages actually incurred. The doctrine, which has long stood for the proposition that one cannot recover purely economic damages in tort, can often come into play with design professionals, who commonly contract directly with only the owner of a project, but issue reports, plans and specifications that are for the purpose of, and must be relied upon by, other parties for the performance of their work on the project.

In a recent article in Under Construction, the ABA Forum’s newsletter on construction law, colleagues Clark Thiel, Matthew Stockwell, and Jessica Bogo explore the different approaches taken by New York and California in applying the economic loss doctrine with regard to damages resulting from services provided by design professionals on a construction project.

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Pursuant to the provisions of Section 102(c) of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, as amended, the Office of the Secretary, Department of Homeland Security, in her “sole discretion” has waived in their entirety the following laws (including all federal state, or other laws, regulations and legal requirements deriving therefrom) to expedite the construction of barriers and roads in the “project area” described as being located in the vicinity of the international land border of the U.S. near the Santa Teresa Land Port of Entry in the State of New Mexico: Continue Reading ›

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Today, our colleagues Michael Rizzo, Glenn Sweat and John Jensen published their Alert titled The 2018 Government Shutdown – How Can Contractors Preserve Rights? Takeways from the Alert include:

  • Communicate with your Contracting Officers early and often regarding approvals and responses to inquiries.
  • Analyze current contracts. Assess contract funding levels, determine which contracts which must continue, and become familiar with Suspension of Work, Stop Work, and Government Delay of Work clauses.
  • Minimize financial damage and maintain continuity of operations and high employee morale.

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On December 22, 2017, the U.S. Court of Appeals for the District of Columbia Circuit issued a unanimous opinion upholding most of the Occupational Safety and Health Administration’s (OSHA) 2016 revised workplace standard for respirable crystalline silica, 29 C.F.R § 1910.1053(a)(1). The case is North America’s Building Trades Unions v. OSHA. The new rule lowers by half the permissible exposure level (PEL) of a worker’s exposure during the workday for all covered industries including the foundry, brick, construction and hydraulic fracturing industries.

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The states employ unclaimed property laws (also referred to as escheat laws) to determine if property owned by one person but that is in the possession of another person is subject to the state’s control after the period of abandonment set by state law has passed. In recent years, states have aggressively enforced their unclaimed property laws by both auditing companies and assessing fines for failure to comply with the state’s laws. Large and small companies confront the states’ aggressive tactics pretty regularly and, more recently, companies have been fighting back because complying with the state’s audit requests is expensive and time consuming and, from their perspective, the large fines that a state can assess for failure to comply with the state’s unclaimed property law are unfair and unreasonable. Recently, companies have been turning to federal common law for protection against state actions of this nature.

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On November 22, the Texas Court of Appeals, sitting in Fort Worth, decided a case involving mandatory sanctions awarded under the Texas Citizens Participation Act (TCPA). In Rich v. Range Resources Corporation, et al., the Court of Appeals determined that although that denial of sanctions was erroneous, it was not harmful; error.

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In the case of CH2M Hill Engineers, Inc. v. Springer, et al., the Court of Appeals of Texas, Ninth District, sitting in Beaumont, decided an interlocutory appeals brought by the Appellant CH2M Hill Engineers, Inc. The Court of Appeals concluded that the “trial court did not abuse its discretion when it denied CH2M’s motion to dismiss” based upon the evidence before it, and affirmed the trial court’s order. The Court of Appeals noted that

While the record contains evidence that CH2M is registered with the Texas Board of Professional Engineers, the record does not contain any evidence that a licensed or registered professional practices within CH2M. Scott Neeley, Senior Designated Manager, signed the agreement between CH2M Hill and the Appellees. Mr. Neeley has not been shown to be a ‘licensed or registered professional,’ nor did he sign the contract as such. Moreover, the report is not signed by a licensed or registered engineer, but only issued by ‘CH2M Hill.’ CH2M has not proven, or even identified a single licensed professional engineer who performed professional engineering services for the firm.

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On November 27, the U.S. Court of Appeals for the Seventh Circuit decided the case of Betco Corporation v. Peacock, et al., which concerns a contractual dispute between the buyer and the seller of companies that produce and market a biodegradation product that is utilized in waste management and control. After paying out the escrow contemplated by the parties’ contract, Betco Corporation (Betco) “discovered that certificates of analysis were being re‐used or falsified by the sales team.” Critical of Betco’s due diligence efforts, the Seventh Circuit held that Betco

“failed to develop its argument in the district court that its breach of contract claim was in fact a claim for intentional misrepresentation that should have survived the Agreement’s one‐year time limit. Thus, it waived this claim, and we decline to hear its merits.

However, Betco did not waive its claim against Malcolm Peacock for breach of the duty of good faith. But our only inquiry in analyzing this claim is whether Malcolm acted in a way that injured or destroyed Betco’s ability to receive the benefits of the contract. Because Betco proffered no evidence at trial of consumer complaints, it cannot show that it was deprived of its contractual expectations. To the contrary, Betco received a company producing a successful line of products to the satisfaction of its customers.”

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