Should I Pull the Pin? Contractor and Subcontractor Termination for Cause

Any owner or general contractor who has a few projects under his or her belt has likely had this thought: “My contractor (or subcontractor) is not performing the way I expected; should I replace him?” The other side of the termination coin is: “This project is not going the way I expected; should I get out?”

While there may be an emotional high that immediately comes from terminating a contractor or subcontractor (or leaving a project, in mid-stream), there are many factors to be weighed, before making that decision.

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After Sixty Years, Subcontractors are Back in the Driver’s Seat in Bidding on California Construction Projects

In virtually every complex construction project, the general contractor will submit a competitive bid for the work, and in doing so will rely on underlying bids from prospective subcontractors in particular trades. One of the enduring legal issues in this scenario is the justifiable reliance that a bidding general contractor places in a subcontractor’s bid. If the general uses the sub’s bid, does that automatically lock in the price stated by the subcontractor? What about the other items that may be buried within the subcontractor’s bid? A recent decision from the court of appeal sheds much needed light on these issues.

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Understanding Mold and Mold Lawsuits

Recent years have seen an explosion of mold litigation with the publication of several multimillion dollar jury verdicts in toxic mold lawsuits. While large plaintiff’s verdicts are well publicized, defense verdicts in mold cases rarely, if ever, receive public notice. Prior to 2000, relatively few mold claims were pursued, and claims were routinely settled for nominal amounts – $5,000 or less. Since then highly publicized seven and even eight figure jury verdicts have led to a proliferation of mold litigation. U.S. insurers paid $1.3 billion in mold-related claims in 2001 and more than $3 billion in 2002¹ Medical opinion on mold related disease is evolving, and many mold injury cases are pursued without solid medical or scientific support.

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Mass Construction Defect Actions: How Trade Contractors can Fight Back

It has become much easier for trade contractors and their attorneys to follow the herd and plod along in a wasteful and costly construction defect matter. Challenging the norm is all too rare in this business. However, there can be great advantages to being the pot-stirrer. Trade contractors and their attorneys (insurance retained or private) should plan out a meaningful strategy at the outset of every case, including exploring motions challenging the pleadings. The outcome, if successful, can save the trade contractor (and its insurer where applicable) tens of thousands of dollars in defense costs owed to its own attorney, the attorneys for the general contractor, the Special Master, and others who feed at the trough of the mass defect actions.

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Important Changes to California Construction Forms Beginning on July 1, 2012: The Impact of 2010 Senate Bill 189

The most important changes to California construction law in decades will become effective on July 1, 2012. Signed into law in 2010, Senate Bill 189, reorganized and renumbered all those California Civil Code provisions dealing with such familiar construction claim remedies as the Mechanics Lien, Stop Notice and Bond Claim. While this effort greatly simplified the legal rules and made them easier to follow, there are a number of important substantive changes to these laws. These changes include new definitions, new rules and new procedures found in new Civil Code Sections 8000 to 9566. These changes also mean that new forms will be necessary. As a result of these changes, all those in the construction industry should begin using the new forms and procedures beginning on July 1, 2012. Failure to do so could result in loss of important legal rights. Some of the most important changes to the forms are outlined below. A website to access the new forms free of charge is also identified below.

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Sacramento Air Board Construction Mitigation Rule 1052: Upcoming Costly Regulation

Another costly new regulation is heading our Industry’s way early next year. The Sacramento Air Quality District (AQMD) has recently released a proposal that would force every construction project (Over 2,000 sq ft Commercial) to reduce their total project baseline carbon emissions by 20% Nitrate Oxide (NOx) and by 45% Particulate Matter (PM 10). Submittals of full equipment lists, project durations, and the size of the job-site are all necessary for the Air Board’s “scientific determination” of whether a project has met its carbon emission targets. If companies do not meet the stringent new guidelines, they will be required to pay a fee ranging from a minimum of $16,400 to a maximum of $38,960 per ton of (NOx). Particulate matter will also be charged via Cap & Trade, but this fee has not yet been released to the public.

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