Construction Dispute

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Constructural Dynamics, Inc. v. Thomas P. Carney, Inc., No. 1104 EDA 2021, 2022 Pa. Super. Unpub. LEXIS 1500 (Pa. Super. July 1, 2022), reargument denied (Sept. 8, 2022).

Like many prompt payment acts, Pennsylvania’s Contractor and Subcontractor Payment Act (CASPA) permits owners and contractors to withhold payment for good faith claims — but not forever. Owners and contractors who wait too long could find themselves litigating prompt payment claims and paying the penalties those acts impose on procrastinating payors. A recent decision by the Pennsylvania Superior Court provides some guidance on how long is “too long” to withhold.

Accreditation: An extract from GAR’s Construction Arbitration Know-how. The whole publication is available at https://globalarbitrationreview.com/insight/know-how/construction-arbitration.

Troutman Pepper Partners Albert Bates and Zachary Torres-Fowler are published in GAR Insight with their article, “GAR Know How Construction Arbitration: USA (September 2022).” This chapter summarizes issues commonly raised during international construction arbitrations…

This article summarizes statutory remedies available to contractors, subcontractors and material suppliers when upstream parties fail or refuse to release payments on public and private construction projects. Entities furnishing work or materials have several statutory means to enforce their rights to payment, including mechanic’s liens, payment bond claims, and/or claims…

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).

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.

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).

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.

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.”

The Army Corps of Engineers denied a construction permit for Alaska’s Pebble Mine project to proceed in accordance with the Clean Water Act (CWA).[1] Excavation of Pebble Mine — a sprawling depository of gold, copper, and molybdenum — would discharge fill material and dredge into U.S. waterways.

The project’s developers applied for a permit under the CWA, requiring the Army Corps to assess the project’s potential impact on nearby bodies of water. When project-produced dredge and fill threaten unavoidable adverse impacts on waterways, projects may not proceed without appropriate mitigation measures.