Retention payments are a longstanding practice in construction contracts, serving as a form of financial security for project owners to ensure proper and timely completion of work. It is typical for Owners in private work contracts to withhold up to ten percent (10%) from each payment owed to contractors and subcontractors. While this practice was intended to guarantee quality and incentivize completion, it often resulted in considerable financial stress for contractors and subcontractors, particularly in an industry characterized by slim profit margins and steady ongoing obligations for payroll, benefits, and material costs. Recognizing these challenges, California legislators introduced and recently passed Senate Bill 61 (“SB 61”) to update retention laws for private construction projects, with the stated goal of fostering greater fairness and financial stability across the construction industry.Continue Reading California’s SB 61: New Limits on Retention Payments in Private Construction Contracts

On June 10, 2023, a jury in Portland, Oregon found PacifiCorp and Pacific Power (collectively, “PacifiCorp”) liable for negligence, trespass, and nuisance based on a series of four wildfires that occurred during Labor Day weekend in 2020. PacifiCorp prevailed against the plaintiffs on the claim of inverse condemnation. With respect to the tort-based claims, the jury awarded approximately $72 million in compensatory damages to 17 plaintiffs. The jury later found PacifiCorp liable for $18 million in punitive damages, or one quarter of the compensatory damages that the jury awarded to the 17 plaintiffs. The jury’s liability findings apply to a broader class of owners, whose damages will need to be individually proven in a yet-to-be defined second phase of proceedings. Post-verdict motion practice and appeals may affect the jury’s findings.Continue Reading Beyond Inverse Condemnation in Wildfire Litigation: An Oregon Jury Finds Utility Liable for Negligence, Trespass and Nuisance

Move over luxury bus lines and quick flights. Central Texans should be on the lookout for bulldozers and train stops. On June 24, 2022, the Supreme Court of Texas held that Texas Central Railroad & Infrastructure, Inc. and related entities (collectively “Texas Central”) have eminent domain authority to acquire property for a proposed high-speed rail system between Dallas and Houston.[1] Specifically, the Court held that the corporation qualifies as an “interurban electric railway company” under the Texas Transportation Code. This ruling grants Texas Central the broad condemnation authority to procure land for the project.Continue Reading Texas Central Wins Authority to Take Land for High-Speed Rail System

On March 11, 2022, the Department of Labor (“DOL”) proposed reverting the definition of “prevailing wage” under the Davis-Bacon Act to a definition used over 40 years ago. According to the DOL, the proposal is meant to modernize the law and “reflect better the needs of workers in the construction industry and planned federal construction investments.”[1]
Continue Reading Turning Back the Clock: DOL Proposes Previous Davis-Bacon Prevailing Wage Definition

On July 21, 2021, the National Labor Relations Board (“NLRB” or the “Board”) issued a 3-1 decision affirming its precedent that displaying banners and a large inflatable rat (“Scabby the Rat”) near neutral employers does not violate the National Labor Relations Act (“NLRA” or “the Act”).  This decision may come as a disappointment to many employers as the NLRB under the Trump administration had been making efforts to end what many felt was unlawful secondary picketing under the Act.
Continue Reading Scabby Survives Another Trip to the NLRB: Board Reaffirms Rat-and-Banner Displays Targeting Neutral Businesses Are Permissible

Not your average game of patty-cake! Earlier this week, New York’s  First Department, Appellate Division issued its decision related to 200 Amsterdam,[1] overturning the lower court’s decision which would have required 200 Amsterdam to remove several floors of its building in order to comply with zoning.  The lower court determined that the NYC Zoning Resolution did not permit a developer to utilize a portion of a tax lot to merge with a neighboring zoning lot.
Continue Reading Build Me A Building As Fast As You Can

Contractors performing work in California are required to be licensed by the California State License Board (“CSLB”).  Cal. Bus. & Prof. Code §7065.  Except for sole proprietors, contractors are typically licensed through “qualifiers,” i.e., officers or employees who take a licensing exam and meet other requirements to become licensed on behalf of the contractor’s company.  Contractors who perform work in California without being properly licensed are subject to a world of hurt, including civil and criminal penalties (see, e.g., Cal. Bus. & Prof. Code §§ 7028, 7028.6, 7028.7, 7117, and Cal. Labor Code §§ 1020-1022), and the inability to maintain a lawsuit to recover compensation for their work.  Cal. Bus & Prof. Code § 7031(a); Hydra Tech Systems Ltd. v. Oasis Water Park, 52 Cal.3rd 988 (1991).
Continue Reading Landmark Contractor Licensing Case Limits Disgorgement Remedy in California

Amidst the ongoing Covid-19 pandemic, daily and sometimes hourly changes in federal, state, and local orders and regulations are significantly impacting the construction industry.  This blog provides an overview of practical issues to consider related to your California construction projects in light of the ever-changing landscape.
Continue Reading California Construction in the Time of Covid-19

Indemnification clauses appear in nearly every agreement, but they are often overlooked as mere boilerplate provisions after the parties have painstakingly negotiated all of the other terms. It is not uncommon for parties to simply re-use the indemnity language from a prior agreement without considering whether it is a good fit for their current project. This can be a big mistake that may lead to ambiguities and uncertainties if a dispute arises down the road. A standard or canned indemnification clause might work to undo all of the effort that has gone into properly allocating risk. These clauses often contain language such as “notwithstanding anything to the contrary herein,” or the like, which can alter and override other provisions in the agreement.
Continue Reading Last, but NOT Least: Why You Should Take a Closer Look at Your Next Indemnification Clause