In a recent client conference, I was asked, “So what is arbitration, anyhow?” In the context of a construction claim or in seeking to prevent such a claim, there are several significant advantages that arbitration can provide in lieu of litigation. In today’s challenging business environment, this signifies awareness of the various options available that could make an important impact on your business’ circumstance.
Are contractors responsible for the impacts of their work on neighboring residents? Oftentimes, they are. This is especially true in densely populated urban areas where literally hundreds of people could be affected by a project only fifty feet away. Some of the principles in these cases are outlined below.
Construction contracts require contractors and subcontractors to carry commercial general liability, or CGL, insurance and to name not only the contracting parties but additional third parties, such as project owners, as additional insured. Recent commercial general liability litigation, however, suggests that contractors and subcontractors should review the language of their CGL policies carefully because third parties to the contract, even if they are contractually required to be additionally insured, may actually be excluded by the insurance policies.
Traditionally, New York Construction Law sets separate rules of engagement for public projects (where the owner is a public entity) and those that are private construction projects (where the owner is a private individual or corporation). Given these two distinct camps, it has been easy to classify a project as either a public project or a private one. For contractors, subcontractors and suppliers, knowing which rules of engagement pertain to them is essential to avoid making costly mistakes.
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.
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.
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.
The New York Education Department, Office of the Professions, regulates the licensing of the various professions, such as Lawyers, Certified Public Accountants, Architects, and other professions practicing within the state. Typically these professionals must pass initial education and examination requirements, and are also required to maintain certain levels of continuing education units. These requirements are intended to foster continued education and training throughout their career.
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.
Recently, a contractor asked me how to create a good contract. After further discussion, I understood that this contractor was not licensed, but wanted advice on obtaining a good contract. Well, what is a good contract after all?