Protections Provided to New York Architects and Contractors under the Economic Loss Rule

THE ECONOMIC LOSS RULE IN NEW YORK CONSTRUCTION CONTRACTS:

WHAT IT IS AND HOW IT MAY BENEFIT CONTRACTORS AND ARCHITECTS

The “economic loss rule” is a rule that New York courts use to prevent a plaintiff from recovering against a defendant for a tort (usually negligence), when the essence of the plaintiff’s claim is for failure to live up to the terms of a contract.

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Contractors in New York may not be bound by Architect Certifications

Construction contracts in New York often place the architect or engineer in the additional role of an initial impartial decider as to any disagreement or disputes between the contractor and the owner, in addition to their roles as the design professionals.

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Violation of the New York Prompt Payment Act Does Not Bar Defenses

General Business Law Section 756 (and the sections that follow it), commonly known as the Prompt Payment Act, establish requirements for how soon a construction contractor or subcontractor must be paid and allow expedited arbitration in the event that prompt payment is not made for qualifying projects.

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The Top 5 Avenues of Architect Liability in New York

Architects in New York can be found liable for damages in various situations, depending on who claims damage, and the basis of the claim itself. For example, where an owner has a direct contract with the architect, the owner could bring forth a simple claim based on the contract or a claim based on a tort action. Such a tort action, based on negligence, is a claim for malpractice.

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Construction Warranty vs. Statute of Limitations Between Builder and Owner

Like the strings of a marionette puppet, after the completion of a New York construction project there are various legal theories that serve as ties between the builder and the owner. For the builder, the sooner these lingering ties can be removed the less exposure they face for claims of defects. For the owners, the longer they are able to establish these connections the longer they may have legal recourse against the builder for defects, should that be necessary.

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Essential Provisions for Subcontractor Agreements

When it comes to subcontractor agreements, there are numerous types of agreements that might be used and the fine print in these agreements can be crucial. Some documents, such as the American Institute of Architects (AIA) 401 and the Associated General Contractors of America (AGC) Form 640 serve as standard forms of agreement.

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5 Reasons that may Justify the Termination of your Construction Agreement

This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.

When homeowners are ready to get the ball rolling with their new construction project, excitement and happy emotions usually take over when signing the construction agreement. With that said, however, there is an important relationship from start through final completion with your contractor, and significant issues could develop. When advising in breach of contract and contract termination cases, there are five examples all homeowners should look out for before pulling the trigger, that may justify your agreements termination. Continue reading “5 Reasons that may Justify the Termination of your Construction Agreement”

Top 3 New Construction Arbitration Rules That Expand Powers and Challenge Assumptions

When it comes to construction contracts, arbitration and mediation (Alternate Dispute Resolution) are both commonly specified for out of court dispute resolution.  The use of mediation and arbitration in construction contracts, both for small and large construction, has been increasingly common over the past decade.

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So What Is an Improvement, Anyhow?

 

Under New York construction law, much emphasis is placed on the “improvement” of real property (real estate). Indeed reference to improvements are often found in New York construction contracts, and establishing an improvement is required for a contractor to establish a valid lien on a privately owned project. But what specifically are the ins and outs?

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Post Contract Signing Considerations For The New York Contractor

Contractors and subcontractors frequently consult with their attorneys in the negotiation of construction contracts before they are signed, but counsel’s involvement generally ends at that point until and unless litigation arises down the road. Nevertheless, additional consultation with attorneys after execution of contracts can ensure that contractors and subcontractors meet their respective obligations and may confer savings that far offset the costs.

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