Pennsylvania Superior Court Holds that Unions May File Mechanic’s Liens for Unpaid Contributions

Under Pennsylvania’s Mechanics’ Lien Law, only a “contractor” or “subcontractor” is permitted to file a lien claim against an owner of property, 49 P.S. § 1303(a), for the payment of debts due by the owner to the contractor or by the contractor to any of his subcontractors for labor or materials furnished during a project. 49 P.S. § 1301; see 49 P.S. § 1201(4), (5) (defining “contractor” and “subcontractor”).

On January 6, 2012, the Pennsylvania Superior Court held in Bricklayers of W. Pa. Combined Funds v. Scott’s Dev. Co., 2012 PA Super 4; 2012 Pa. Super. LEXIS 5 (2012) that a labor union is a “subcontractor” under the Mechanic’s Lien Law, and, therefore, trustees of a union benefit fund have standing to file a mechanic’s lien claim on behalf of its members.

As a result of the Superior Court’s ruling, labor unions will likely file more mechanics’ lien claims for unpaid and/or delinquent contributions. Thus, in order to ensure that no mechanic’s liens are filed on a project, owners should attempt to verify on a monthly basis that money is properly disbursed down the construction chain. Towards that end, an owner needs to obtain partial payment releases from its contractors and subcontractors on a monthly basis. In addition, an owner should consider making certain payments by joint check, if the owner suspects any problems.

Another State Joins List Of Anti-Additional Insured.

Effective this month, the State of Texas joins the list of states with both anti-indemnity and anti-additional insured statutes. In legislation signed last summer by Gov. Rick Perry but not effective until January 1, 2012, Texas — previously viewed by construction law practitioners as a permissible venue which it came to risk shifting and indemnification — joined the now long list of states prohibiting clauses in construction contracts requiring indemnification of indemnitees for their negligence.[1] Moreover, in so doing, Texas also joined the small but growing list of states prohibiting additional insured requirements – such as requirements in subcontracts requiring subcontractors to add contractors, construction managers and owners as additional insureds to the subcontractors’ policies. Other states on that list include: Colorado[2], Kansas[3], Montana[4], New Mexico[5], Oklahoma[6], Oregon[7] and Utah[8].

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The Nuclear Regulatory Commission Approves Amended Version of AP1000 Nuclear Reactor Design for Use in the United States

On December 22, 2011, the United States Nuclear Regulatory Commission approved a rule certifying an amended version of Westinghouse’s AP1000 reactor design for use in the United States. The amended design certification, which will be incorporated into the NRC’s regulations, will be valid for 15 years.

The AP1000 is a 1,100 megawatt electric pressurized-water reactor. Westinghouse submitted an application for certification of the original AP1000 standard plant design on March 28, 2002, and the NRC issued a rule certifying that original design on January 27, 2006.

Westinghouse, however, submitted an application to amend the AP1000 on May 27, 2007, in order to ensure that the AP1000 could meet certain post 9/11 requirements, which included incorporation of protection around the building that could sustain the impact of an airplane crash.
Many in the industry now expect that the NRC will issue combined construction and operating licenses for new nuclear units.

The Pennsylvania Department of General Services Selects Contractor for New Prison Project

On October 26, 2011, the Pennsylvania Department of General Services announced that a joint venture between Walsh Construction and Heery International, with a bid of $315,797,000, was selected to build a new, multi-use state correctional facility in Montgomery County, Pennsylvania.

The project, called State Correctional Institutions Phoenix East and West, had been delayed by bid protests and litigation, and was rebid after original plans were completely overhauled to meet the present and future needs of the Department of Corrections. The facility, which is expected to be completed by 2014, will be built on the grounds of SCI Graterford.

The New Jersey Schools Development Authority Announces First Plans for Standardization of School Designs

On March 2, 2011, the New Jersey Schools Development Authority (SDA) announced its Model Schools Program, an initiative to implement a standardized design for SDA school facilities. As part of this initiative, SDA planned on implementing standardized systems and materials in three phases.

Consistent with this plan, the SDA recently completed its first phase, and, has released two new manuals titled: Materials and Systems Standards Manual and Construction Details Manual. These manuals, which apply to Public School Facilities Projects in the State of New Jersey that are managed by the SDA, set forth the model systems and components to be used during construction of new facilities including standards for roofing, HVAC systems, flooring, finishes and more.

The remaining two phases of the NJSDA Model Schools Program standardization plan, the “Kit of Parts” which will provide uniform designs for classrooms and other school facility areas and the “2011 Design Manual” which will be the first design update since 2007, are expected to be released by the SDA in the near future.