Tennessee has enacted a pilot program for public transportation projects using CM/GC project delivery.  This represents an incremental expansion of the delivery method on public projects nationwide, albeit on a trial basis for Tennessee.  The first of three projects allowed under the law may be no larger than $70 million, and the projects may not exceed $200 million in the aggregate.  The new program was reported by Matt DeVries on his blog. 

In the construction industry, the payment application process usually requires contractors and subcontractors to complete a great deal of paperwork.  In addition to submitting traditional payment applications that identify the contractor’s or subcontractor’s schedule of values, work completed to date, and balance to finish, contractors and subcontractors may also be required to submit certain lien waivers, certifications, affidavits, and other types of sworn representations.  While these additional submissions may seem clerical, or even ceremonial in nature, they can have serious legal ramifications.

There may not be a law like it anywhere else in the country.  But in Rhode Island, by statute, the second-low bidder can pursue a claim for damages if the low bidder violates the prevailing wage laws.  A recent Superior Court decision allows a pending claim by one such disappointed bidder to move forward.

Suppose you’re a prime contractor with a financially-shaky sub, and you agree with the sub’s secured lender to make payments directly to the lender.  But someone forgets to alert your accounts payable person or group, and so your company continues to pay the sub directly, to the tune of $3.8 million.  The sub later goes out of business, and the lender ends up with a shortfall of $500,000 on its secured line of credit.  The lender then sues you, the prime contractor, seeking not just the $500,000 shortfall but the entire $3.8 million.  What is the outcome under the Uniform Commercial Code (UCC)?

On September 28, 2012, Ohio Senate Bill 224 became effective and reduced the statute of limitations period for written contracts from 15 years to 8 years.  This new law applies retroactively to causes of action which accrued prior to September 28, 2012, and provides that “an action upon a specialty or an agreement, contract, or promise in writing shall be brought within eight years after the cause of action accrued.” See Ohio Rev. Code § 2305.06

The folks who eroded the privity rule in A.R. Moyer v. Graham have now abolished the economic loss rule in Tiara Condominium Ass'n v. Marsh & McClennan.  The decision, issued March 7, 2013 by the Florida Supreme Court, is blunt: “We . . . hold that the application of the economic loss rule is limited to products liability cases.  Therefore, we recede from prior case law to the extent that it is inconsistent with this holding.”  Wow!

Appellate Court holds that the City of New York does not have to indemnify defendants in wrongful death suits arising from a deadly crane collapse because the plaintiffs had not shown a special relationship between the City and the defendants that would give rise to  special duty. In reaching its decision, the Court distinguished between the exercise of the City’s general duty to the public and an affirmative duty that the City may assume towards a particular group.

Court highlights the importance of carefully selecting each term in a construction contract. The words and terms incorporated into the contract must not only be clear and defined, but must also  be consistent.

Citing a decision from the U.S. Supreme Court, the highest Massachusetts court has held that an arbitrator cannot decide the issue of arbitrability unless there is “clear and unmistakable evidence” that the parties intended the arbitrator to have this authority.  Recognizing the distinction between (a) whether a dispute is subject to arbitration, and (b) who decides the issue of arbitrability, the court held that it will not treat a party’s silence or ambiguity on this issue as consent to arbitrability or a waiver of the issue.  Confused?  The case is Massachusetts Highway Dept. v. Perini Corporation (Mass. Supreme Judicial Court, Jan. 17, 2013), available here (subscription required). 

The February 1^st deadline to comply with the New York Wage Theft Prevention Act is fast approaching.  The Act requires New York State employers to provide to each employee a written notice containing specific information about the employee’s wages. The notice must be given to all employees.

The notice must be provided to the employee at the time of hiring, annually on or before February 1st of each year of employment, and within 7 days of a change if the change is not listed on the employee’s pay stub.