Tocci Bldg. Corp. v. IRIV Partners, LLC, 101 Mass. App. Ct. 133 (2022)

For the first time, the Appeals Court of Massachusetts has construed the Massachusetts Prompt Payment Act (the statute), requiring strict compliance on the part of owners and contractors who wish to withhold payments from contractors or subcontractors.

Continue Reading Appeals Court Construes Massachusetts Prompt Payment Act for First Time, Requiring Strict Compliance

The U.S. Department of Defense’s (DOD) new “enhanced” debriefing rule is intended to provide bidders more transparency and increase the efficiency of the DOD’s bidding system. Effective March 18, the rule is mandatory for contracts and orders worth more than $100 million, while also impacting those worth between $10 million to $99 million to a lesser extent. The DOD believes that sharing more information and providing the ability to ask questions will reduce the number of protests.

Continue Reading DOD Issues Final “Enhanced Debriefing” Rule for Government Bids

Bank of America, N.A. v. ASD Gem Realty LLC, 205 A.D.3d 1, 164 N.Y.S.3d 566 (2022).

ASD Gem Realty LLC and ASD Diamond, Inc. (together, ASD or Owner) contracted Sweet Construction Corp. (Sweet) to renovate a commercial space in Manhattan’s Diamond District (the Project). ASD solicited proposals for the supply and installation of partitions in the space (the Work) and ultimately directed Sweet to hire Arenson Office Furnishings, Inc. (Arenson). Arenson subsequently entered into a subcontract with Sweet to complete the Work (the Subcontract).

Continue Reading NY Appellate Court Reaffirms Pay-When-Paid Provisions Are Void as Against Public Policy

DonRob Invs., L. P. v. 360 Residential, LLC, 870 S.E.2d 874 (Ga. Ct. App. 2022)

This case arose from a failed real estate transaction. DonRob Investments LP and Donald Robinson Investments, Inc. (collectively DonRob) agreed to sell, and 360 Residential LLC, 360 Sugar Hill LLC, and 360 Capital Company LLC, (collectively 360) agreed to purchase 12 acres (Site) of a 37-acre parcel of property in Sugar Hill, GA (the Agreement). The Site was in the middle of the parcel and flanked by two sections over which DonRob was to retain ownership. 360 planned to build apartments on the Site. DonRob planned to develop the other two sections into townhomes and commercial units.

Continue Reading GA Court of Appeals Enforces Contract Clause, Excluding Liability for Incidental Damages Where Specific Performance Is Ordered

True to form, Texas has joined the majority in adopting the Spearin concept in its own way. The new law is thoughtfully designed for modern alternative and hybrid project delivery methods and cannot be waived by agreement, say Troutman Pepper Construction group attorneys Ben Deninger and David Mancini.

Click here to read the full article on Texas Lawyer.

Most are familiar with California’s harsh penalty for unlicensed contractor work. California Business and Professions Code Section 7031 (Section 7031) bars any recovery for compensation for work performed by an unlicensed contractor under any theory of recovery “regardless of the merits of the cause of action.” Cal. Bus. and Prof. Code § 7031(a). It is well-established that subcontractors are covered by Section 7031 from recovering from owners and general contractors if not properly licensed. See Cal. Bus. and Prof. Code § 7026. However, in Kim v. TWA Construction, Inc., 78 Cal.App.5th 808 (2022), the California Court of Appeal, in a matter of first impression, expanded the effect of Section 7031(a) to bar a licensed general contractor recovering from an owner for work completed by an unlicensed subcontractor.

Continue Reading CA Court of Appeal Affirms Bar on Recovery of Licensed General Contractor for Work Performed by Its Unlicensed Subcontractor

Taylor Morrison of Tex. Inc. v. Caballero, No. 01-20-00800-CV, 2022 Tex. App. LEXIS 1870, 2022 WL 839429 (Mar. 22, 2022)

Gary and Kelley Caballero contracted to purchase a new home to be constructed by Taylor Woodrow and Taylor Morrison of Texas, Inc. (Taylor). The contract contained an agreement to arbitrate any disputes with the American Arbitration Association (AAA) under the Federal Arbitration Act (FAA).

Continue Reading Texas Court of Appeals Enforces Arbitration Agreement Provision Delegating Issues of Arbitrability to Arbitrator

The Economic Loss Doctrine and its various analogues (e.g., the Independent Duty Rule and the Gist of the Action Doctrine) vary in form and application, but each is a judge-made rule serving one principle: If a party seeks the same economic losses for breach of contract and breach of a common law tort duty, courts must bar the tort claim to prevent a duplicative, windfall recovery. Most frequently, the Economic Loss Doctrine bars negligence claims. Its outer bounds begin with intentional torts, and most jurisdictions do not apply the Economic Loss Doctrine to fraud claims.

Continue Reading Fraud as an Exception to the Economic Loss Doctrine: Changing Trends in Colorado and Tennessee

Bean Sprouts LLC v. LifeCycle Construction Servs. LLC, No. 001268-CV-2021 (Pa. Super. Feb. 17, 2022)

The Superior Court of Pennsylvania recently raised the bar for state courts to assert jurisdiction over out-of-state defendants in actions brought by residents arising from out-of-state projects.

Continue Reading Pennsylvania Appellate Court Affirms Dismissal of In-State Subcontractor’s Suit Against Out-of-State General Contractor for Lack of Jurisdiction, Despite “Long-Term and Ongoing Contractual Relationships”

Construction and Energy Practices Honored With National Awards

Law360 has named two Troutman Pepper practices among its Practice Groups of the Year for 2021. The firm achieved the national recognition for both its Construction and Energy practices. According to Law360, 91 firms submitted nearly 900 nominations for the awards, which “honor the law firms behind the litigation wins and major deals that resonated throughout the legal industry in the past year.”

Construction Group of the Year

“We are excited to be recognized nationally for our work in the construction space,” said Mike Subak, who leads the firm’s Construction Practice Group. “Our team advises industry leaders on both their largest projects as well as their day-to-day details, and the work is incredibly rewarding.” Continue Reading Law360 Recognizes Troutman Pepper Practices as 2021 Practice Groups of the Year