Duane Morris Construction Law

June 25, 2013July 28, 2014 by Richard P. Dyer

New York City Sandy Neighborhood Game-Changer Investment Competition

New York City economic Development Corp. is requesting proposals from qualified firms or individuals to establish programs to “catalyze significant long-term economic growth” in five areas impacted by Hurricane Sandy. See here.

The RFP process is described by the EDC as:

“NYCEDC is requesting proposals from qualified individuals, organizations or companies to execute projects and/or programs that will catalyze significant long-term economic growth in one of the following five areas impacted by Hurricane Sandy: the East and South Shores of Staten Island, Southern Manhattan, Southern Brooklyn, the Brooklyn-Queens Waterfront, and South Queens (collectively, the “Impact Areas”).

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June 19, 2013July 28, 2014 by Charles Fastenberg

City Of New York Amends Its M/W/EBE Law

New York City Local Law 1–2013, effective July 1, 2013, amends the City’s laws concerning participation by Minority-Owned, Women-Owned, and Emerging Business Enterprises (“M/W/EBE”) in City contracts. The City’s M/W/EBE laws, including the amendments, are imposed upon the individual agencies and serve to guide the agencies in the administration of M/W/EBE programs under their respective contracts; these laws are not imposed directly upon the contractors and vendors themselves. Among the amendments concerning construction contracts are a reduction in the participation goals for African-American and Hispanic-Americans and increased goals for WBEs. The $1 million cap for eligibility as a “disadvantaged” entity has been removed.

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May 13, 2013July 28, 2014 by Patrick J. Kearney

Beware Partial Releases and Waiver of Claims are Enforceable, But Can Be Waived

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.

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April 23, 2013July 28, 2014 by Richard P. Dyer

Another New York State Sales Tax Opinion on Sidewalk Sheds

The New York State Department of Taxation and Finance, Office of Counsel, Advisory Opinion Unit recently issued an opinion concerning the application of sales tax on the installation, rental and dismantling of temporary pedestrian walkways (sidewalk sheds) on capital improvement projects. A taxpayer had posed two questions for an advisory opinion, (1) are such sales taxable when the compensation is stated as a lump sum for the rental and the service combined, and (2) would the tax be applicable if the rental and installation charges were separately stated on invoices?

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March 13, 2013July 28, 2014 by Patrick J. Kearney

Ohio Reduces the Statute of Limitations Period for Written Contracts by Seven Years

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.

This new law, however, does not alter the six-year statute of limitations applicable to promissory notes or the four-year statute of limitations applicable to contracts for the sale of goods. Ohio Rev. Code §§ 1303.16 and 1302.98.

Generally, statutes of limitations are enacted to ensure that plaintiffs pursue legal action with reasonable diligence and protect defendants from having to disprove a stale claim. Historically, Ohio had one of the longest statutes of limitations for written contracts in the country. Because Ohio’s statute of limitations period for written contracts has almost been cut in half, all parties to a contract must re-evaluate the manner in which they assess potential causes of actions in order to ensure that all claims are prosecuted in a timely manner.

March 4, 2013July 28, 2014 by Jose A. Aquino

Proposed Legislation Requires that Professional Services Contracts With Certain Bi-State Authorities Be Awarded Pursuant To Competitive Contracting Process

Two New Jersey state senators, Sens. Shirley K. Turner and Ronald L. Rice, recently introduced legislation, Bill S2489, that would require professional services contracts entered into by the Port Authority of New York and New Jersey, the Delaware River Port Authority, and the Delaware River and Bay Authority to be awarded through a competitive contracting process. Under current New Jersey law, contracts for professional services can be entered into without public supervision. Should the Bill become law, contracts for services that are of technical and professional nature, including but not limited to, contracts for architectural, engineering, and land surveying services must be publicly announced prior to being awarded. The contract would then be negotiated on the basis of demonstrated competence and qualification to meet the requirements of the particular professional services contract at a fair and reasonable price. The Bill includes exception provisions in the event an emergency is declared by the Governor of New York, the Governor of Pennsylvania, the Governor of Delaware, the Governor of New Jersey, or the President of the United States. A copy of Bill S2489 may be obtained here.

Co-contributor Marco A. Gonzalez, Jr. is a partner in the Newark office of Duane Morris LLP.

February 26, 2013July 29, 2014 by Jose A. Aquino

City Not Liable In Crane Collapse

In 2008, a crane operator and a construction worker were killed when a construction crane collapsed on the east side of Manhattan. The decedents’ estates brought suit against the project owner, the construction manager and the crane operator. The three construction defendants asserted cross-claims against the City of New York seeking indemnification and contribution on the grounds that the City failed in its duty to keep the construction site safe.

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February 22, 2013July 29, 2014 by Jose A. Aquino

Importance Of Using Consistent Terms In A Construction Contract

A recent decision of the Supreme Court of the State of New York reminds us of the importance of using consistent terms when drafting a construction contract. In Clinton Assoc. For A Renewed Envt. Inc. v. Monadock Constr. Inc., defendants, pursuant to a contract (the “Contract”), agreed to provide architectural services and contract administration services to plaintiffs.[i] As part of their work, defendants prepared architectural plans, including specifications for the design system and choice of materials for the exterior masonry wall system. The Certificate of Substantial Completion was signed on March 29, 2006 and, at or about that time, the masonry walls began to fail, causing the walls to bulge and take on water. It was determined that the walls could not withstand the weather cycles to which they were exposed. Following Substantial Completion of the project, defendants worked extensively to cure the flaws in the masonry walls by, among other things, creating an alternate design and supervising the corrective work until August 18, 2008, when an Architect’s Certificate approving the repairs was issued.

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February 15, 2013July 29, 2014 by Jose A. Aquino

Compliance With Contractual Notice Provisions

A recent decision of New York City Office Of Administrative Trials And Hearings (“OATH”) highlights the significance of compliance with each and every provision of a construction contract. Ferreira Construction Co., Inc. v. Dep’t of Transportation, OATH Index No. 1619/12 (Nov. 16, 2012), involved a public contract to reconstruct a pedestrian bridge in Manhattan at East 78th Street and the FDR Drive. The New York City Department of Transportation (“DOT”) contract contained a contractor initiated value engineering change (“CIVEC”) provision that gave the contractor an incentive to propose innovations by allowing for an award to the contractor of 50% of the cost savings if the proposal was accepted by DOT. The dispute concerned the application of the CIVEC clause. The contractor claimed that its accepted proposal under the CIVEC clause saved DOT $252,320.50, and that it was entitled to 50% of the savings of $126,160.25. DOT claimed that the proposal saved the agency only $93,011.50, and that the contractor was entitled to only $46,505.75 additional compensation.

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February 4, 2013July 30, 2014 by Richard P. Dyer

Design Build Update – New York

Last January we reported on an expansion of public design build programs in New York as a result of legislation arising out of Governor Cuomo’s budget for 2012. At that time, New York expanded the number of agencies that were permitted to utilize design build procurement from two to five. Now with the Governor’s proposed 2013 Budget, the design build method will be made available to virtually all state entities, with the only exceptions being the New York City university and New York State university systems.

Of perhaps even greater interest is the current proposed legislation’s introduction of “design build finance” as an available capital procurement method. This device, which may entail use of private and public funds, or perhaps a combination of same, will be available to the same broad range of state public entities as design build will be.

Both procurement methods will follow the two-tier system involving short listing proposers to an RFQ followed by a selection based on best value to the state.

The proposed legislation (See “Public Protection and General Government” Article VII Legislation) can be found here, and a supporting memo here.