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Philadelphia Construction Law Blog

Construction Trivia - Super Bowl Style

Posted by:  Josh Quinter  (jquinter@kaplaw.com)

This weekend's Super Bowl between the New England Patriots and the Seattle Seahawks is being played in Glendale, Arizona at the University of Phoenix Stadium. Home to the Arizona Cardinals of the NFL, University of Phoenix Stadium was constructed at a cost of $455 million and took 3 years to build.

University_of_Phoenix_Stadium_aerial.jpgThe building itself contains enough concrete to build 900 miles of sidewalk, has enough seats to span 9 miles if all 63,500 were lined up in a row, and has a retractable roof. It also has one other unique feature that was the first of its kind in a construction project. Can you name that unique design and construction element?

Primer on Contracts: Payment Clauses

Posted by:  Josh Quinter  (jquinter@kaplaw.com)

Payment clauses ... no construction contract clause has a more immediate impact on the bottom line for contractors of all shapes and sizes. Understanding payment clauses can be the key to knowing when to press for payment or not and, ultimately, whether payment will ever arrive for work on a project. Careful review of your contracts with the help of counsel is a shrewd approach; but here are the basics at the risk of over-simplification.

Construction Contract.pngThe law varies from state to state, but there are generally two types of payment clauses about which contractors should be concerned. The first is pay-if-paid clauses; and the second is pay-when-paid clauses. While they sound the same at first blush, they are different.

Pay-if-paid clauses are exactly as they appear. If the contractor does not get paid by the owner (or a similar combination in the chain of privity), the contractor does not have to pay the subcontractor. This type of clause would include words like "condition precedent to payment", "contingent upon receipt of payment from the owner", "only upon payment from owner", and other similar language.

US DEPARTMENT OF LABOR INCREASES HOURLY WAGES ON FEDERAL CONTRACTS

Posted by:  Josh Quinter  (jquinter@kaplaw.com)

Thomas_Perez_official_portrait.jpgFollowing the lead set in President Obama's Executive Order 13658, the Department of Labor's Wage & Hour Division issued a final rule raising the minimum wage for workers providing labor on federal construction and service contracts to $10.10 an hour. This final rule applies to new and replacement contracts that result from solicitations after January 1, 2015. It also places the Secretary of Labor in charge of setting the minimum wage beginning in 2016 with the restriction that the Secretary cannot ever lower it.

President Obama's Executive Order and the subsequent final DOL rule are ultimately meaningless though. In addition to the fact that most employers already pay more than the minimum wage, the application of Davis-Bacon Act and the similar Service Contract Act requirements on federal projects already require a higher wage than the newly minimum wage rate. Moreover, a completed 2014 analysis of the previous year's salary records shows that the pay of construction professionals was up on average 10% in any case. FMI reviewed 75,000 salary records for 280 positions to reach its conclusions.

Positive News on Real Estate and Construction Market in NJ

Posted by:  Josh Quinter (jquinter@kaplaw.com)

One of the biggest commercial real estate brokerage firms in New Jersey is reporting some positive numbers for New Jersey's real estate and construction economy. According to recent information released by the company, new industrial space was built at the fastest pace seen since 2002 last year. In addition, nearly 12 million square feet of existing tenant space was reabsorbed by the tenants back in the market.

According to Cushman and Wakefield, demand seems to be on the rise for warehouses and distribution centers in the state. It seems likely this demand will only continue to go up as people shop on line and want quick deliveries that can only be provided from closer warehousing and processing centers. In addition, it's not surprising to learn that the numbers show a large portion of this activity taking place in northern New Jersey near the ports.

graph shwoing increase.jpg

Construction Trivia

Posted by:  Josh Quinter  (jquinter@kaplaw.com)

The construction industry is a great way to earn a living and offers the opportunity for workers to offer tangible improvements to the world around them. Working in the industry comes with risks though. In some cases it can mean injury; and in others it can mean, unfortunately, death. Many worthwhile steps are taken to protect workers and allow them to go home at the end of each shift in modern construction. While not even these steps can always prevent an accident, they have gone a long way to decrease construction fatalities.

fall hazard sign.png

Can you name the construction project with the highest known number of fatalities in history?

HILL INTERNATIONAL GETS CONTRACT TO UPDATE NJ TURNPIKE

Posted by:  Josh Quinter  (jquinter@kaplaw.com)

In what appears to be a public private partnership agreement of large proportions, Hill International has been awarded a 4 year contract by the New Jersey Turnpike Authority for the Garden State Parkway and the New Jersey Turnpike. The contract, worth $33.7 million, will require Hill to provide construction management services on a number of projects and inspection services in support of the Facilities Improvement Program.

Hill International, a multi-national construction management and claims services company, has been providing program management services for the Turnpike Authority since 2012. According to Hill International's press release, the new contract aims to bring the Turnpike's roads and facilities into better condition. Much of the infrastructure, which was built approximately 60 years ago, is in need of work. During the course of its new contract, it has 5 separate projects on which it intends to focus. These include the construction of 4 separate police stations, building a backup traffic/data management center, and rehabbing toll facilities at 23 different locations.

PA Superior Court Limits PA Prompt Payment Law

Posted by:  Andy Cohn  (acohn@kaplaw.com)

Owners and contractors on Pennsylvania construction projects are familiar with the Contractor and Subcontractor Payment Act ("CASPA"). CASPA requires owners to pay contractors in accordance with the terms of their contract, and for contractors to pay subcontractors in accordance with the terms of the subcontract. If payments are not timely made without a good faith reason, CASPA allows an unpaid contractor or subcontractor to recover (in addition to the amount owed) interest at the rate of 1% per month, penalties at the rate of 1% per month, and attorney's fees incurred to collect payment.

Jury Trial.pngIn Scungio Borst v 410 Shurs Lane Developers, the Pennsylvania Superior Court decided a case of first impression: whether an individual shareholder of a real estate developer acting as its agent could be personally responsible for CASPA damages. In this case, a general contractor which was owed $1.9 million sued a real estate developer and its 50% shareholder for breach of contract. It secured a judgment against the developer for the balance owed plus CASPA damages, but the trial court determined that the owner of the construction company was not liable for CASPA damages. On appeal, the Superior Court agreed, concluding that CASPA damages could be recovered only from the "Owner" which entered into the underlying construction contract, even though in this case the past owner had acted at all times through its 50% shareholder. The court concluded that if the legislature had intended for individual shareholder agents of owners to be subject to CASPA damages, the language of the statute would have so stated.

Let Us Know What You Want

At Kaplin Stewart, we strive to constantly adapt to the changing times and give our clients the value added services they need.  This endeavor is, in part, why we have a blog and utilize social media.  To make these services as effective as possible, we also like to inquire with our readers as to what they would like to hear from us.  It helps us keep track of what is important to our clients and readers and provide them with the type of information that they need to run effective businesses.  With this in mind, please take a moment and provide us with any topics or ideas you would like to see us discuss on our blog or social media in 2015 in the comments section below.  We welcome any idea you might wish to offer.

Thanks and Happy New Year!

HAPPY NEW YEAR!!

Happy New Year from everyone at Kaplin Stewart.  May 2015 be prosporous and bring you good health and many blessings.

MODEL SILICA SPECIFICATIONS FOR MASONRY GRINDING, CUTTING, AND SAWING ISSUED BY THE CENTER FOR CONSTUCTION RESEARCH TRAINING

Posted by:  Josh Quinter  (jquinter@kaplaw.com)

Because of the work of the Occupational Safety and Health Administration, the CDC, and other construction work groups, many in the construction industry are now aware that prolonged and a high volume exposure to silica based products can cause life threatening diseases. These research and educational efforts have resulted in a better understanding of the threat, lead to better strategies to manage it, and resulted in safety protocols being utilized to protect workers.

mason at work.pngA national advisory group of researchers, contractors, labor organizations, and governmental agencies with field experience using silica based products recently developed a model set of specifications for the purpose of educating end users and developing protocols to manage exposure. Drawn from the CPWR/NIOSH Engineering Control Work Group, the silica advisory task force drafted specifications over a 2 year period beginning in 2012. Those draft specifications were widely distributed for review and comment. They have now been finalized and issued for use by the industry. A copy of the specifications can be found here.

The document is designed to be a "best practice" reference guide that is to be utilized based on the specific needs of the contractor on a project. It contains various pieces of information, including particulars on using control technology, training, and the evaluation of protocols to achieve the best results.

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