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BEGL Construction Company, Inc. et al. v. Los Angeles Unified School District and Star Insurance Com
154 Cal.App.4th 970; 2007 Cal.App. LEXIS 1432 (2007)
In August 2000, the Los Angeles Unified School District (the “District”) entered into a public works construction contract with BEGL Construction Company, Inc. (“BEGL”) for a seismic retrofit of the Science Building at its Los Angles Center for Enriched Studies (“LACES”) and demolition and reconstruction of the LACES West Arcade. Because the project was a public work, BEGL was required to post a performance bond and a payment bond. Subsequently, after BEGL commenced performing work, the West Arcade was removed from the scope of the contract.

South Texas Electric Cooperative v. Dresser-Rand Company
2007 U.S. Dist. Lexis 66345 (S.D. Tex. Sept. 7, 2007)
Plaintiff, South Texas Electric Cooperative (“STEC”) contracted with Defendant, Dresser-Rand Company (“Dresser”) for the design and construction of a steam turbine unit. As part of the contract, Dresser was required to provide equipment, materials and field services free from defects in material and workmanship. Moreover, the equipment had to meet certain performance specifications.

Federated Dep’t Stores, Inc. v. M.J. Clark, Inc.
2007 U.S. Dist. LEXIS 51826 (N.D. Ill. July 17, 2007)
After a flood caused by a leak in the sprinkler system during remodeling at a Bloomingdale’s store in Chicago damaged the first five floors of the store, plaintiffs, Bloomingdale’s and its owner Federated, sued defendant contractor, subcontractor, and building manager for breach of contract, negligence, and indemnification.
The agreement between the contractor and owner provided the contractor agreed to indemnify the owner. It further provided that each party waived all rights against the other for any loss or damage “for which property insurance is carried or required to be carried pursuant to [the parties’] Agreement.” Specifically excepted from the waiver were the contractor’s indemnification responsibilities. During the time of the flood, the owner was covered by an “all risk” insurance policy. Among other things, the policy excluded ordinary wear and tear and errors in design or faulty workmanship.

Donald C. Winter v. CATH-DR/BALTI JOINT VENTURE
2007 U.S. App. Lexis 19565 (Fed. Cir., August 17, 2007)
The United States Court of Appeals for the Federal Circuit (“CAFC”) affirmed in part, reversed in part, and vacated and remanded in part the United States Armed Services Board of Contract Appeals (“ASBCA”) decision that CATH-dr/Balti Joint Venture (“CATH-Balti”) was entitled to an equitable adjust for contract modifications, issued by the Resident Officer in Charge of Contracts (“ROICC”), that called for work not covered under its contract with the United States Navy (“Navy”). The primary basis for reversal was the unambiguous language of the Federal Acquisition Regulation (“FAR”), e.g., 48 C.F.R. § 1.601(a) and 48 C.F.R. § 43.102, Defense Federal Acquisition Regulation Supplement (“DFARS”), 48 C.F.R. § 201.602-2, and FAR Clause 48 C.F.R. § 52.243-4 (Changes Clause), DFARS Clause 48 C.F.R. § 52. 201-7000 (Contracting Officer’s Representative), and Naval Facilities Engineering Command (“NAVFAC”), 5252.201-9300 (Contracting Officer Authority) and 5252.242-9300 (Government Representatives), which were incorporated into the contract and clearly indicated that the ROICC did not have the authority to change the scope of work or authorize compensable changes.

Dur v. Western Branch Diesel, Inc.
2007 U.S. App. LEXIS 16237 (4th Cir. July 9, 2007)
Following the precedent of the Supreme Court of Virginia in Sensenbreunner v. Rust. Orling & Neale, Architects, Inc., 374 S.E.2d 55 (Va. 1988), the Fourth Circuit Court of Appeals upheld the district court’s grant of a motion for summary judgment. The Court held that damage to an owner’s boat caused by an electrical fire fell within the scope of the contract between the owner’s general contractor and the subcontractor and amounted to nothing more than economic loss, which barred the owner from maintaining a cause of action for negligence against the subcontractor.

Mellon v. Shriners Hospitals for Children
2007 Mass. Super. LEXIS 188 (Mass. Super. Ct. June 26, 2007)
The Superior Court of Massachusetts recently considered whether an architect of record on a construction project owed a duty to a third party construction worker on the project for injuries sustained as a result of improper installation of grates. To resolve this issue, the Court found that the whether a duty was owed rested on the language of the architectural services agreement at issue and the level of control the Architect exerted on the job site.

Mactec, Inc. v. Bechtel Jacobs Co., LLC and Demco, Inc. v. Mactec, Inc
2007 U.S. Dist. LEXIS 60377 (E.D. Tenn. August 16, 2007)
The United States District Court for the Eastern District of Tennessee held that a private contractor had no duty to verify the pricing of a bid received from a subcontractor.
Defendant Bechtel Jacobs, LLC (“Bechtel Jacobs”) entered into a contract with the United States Department of Energy’s Oak Ridge Operations to demolish and dispose of several radioactively contaminated buildings in the main area of the K-25 Gaseous Diffusion Plant. Bechtel Jacobs issued a request for proposal inviting proposals from subcontractors to demolish and dispose of several radioactively contaminated buildings from the main plant. In response, Plaintiff MACTEC submitted a proposal in the amount of $3.99 million, which was later adjusted to a final contract price of $5.36 million. Bechtel Jacobs internal estimate for the cost of the project was $8.20 million. The next lowest proposal was $8.44 million. Bechtel Jacobs did not inform MACTEC that its proposal was significantly lower than Bechtel Jacobs internal estimate and significantly lower than the next lowest bidder. Bechtel Jacobs awarded MACTEC the subcontract.

U.S. ex. rel. Straightline Corp. v. American Casualty Corp.
2007 U.S. Dist. LEXIS 50688 (N.D. W. Va 2007)
The United States District Court for the Northern District of West Virginia held that a “pay-if-paid” clause was not a valid defense to a Miller Act claim. Straightline, involved a contract dispute…

Trinity Church v. Atkin
925 A.2d 720, 2007 N.J.Super.LEXIS195 (N,J, Super, App. Div., June 27, 2007)
Contractual clauses providing for the date of accrual on construction projects are valid in New Jersey. The Superior Court of New Jersey, Appellate Division, affirmed summary judgment in favor of defendants who allegedly performed defective renovation and construction work on a historical building because the plaintiff failed to file a timely action within the period of the statute of limitations.

Integrated Project Services v. HMS Interiors, Inc.
2007 Pa. Super 246, 2007 Pa. Super. LEXIS 2606 (Pa. Super Ct., April 16, 2007)
This is an appeal from a decision in the lower court wherein a general contractor, “Integrated Project Services, (“General Contractor”) sued a subcontractor, HMS Interiors, Inc. (“Subcontractor”) for a declaratory judgment that the Subcontractor was obligated to indemnify the General Contractor for the General Contractor’s negligence. The Subcontractor filed a motion for judgment on the pleadings which was granted by the lower court and the General Contractor appealed that decision.