Monthly Archives: February 2013

Construction agreements often contain clauses requiring parties to submit their claims to arbitration. These provisions are favorable to the parties, as arbitration has certain benefits. For example, it may be quicker and more efficient than going through the court system and may be more relaxed than the legal process, thereby encouraging compromise or ongoing business relationships between the parties. An arbitrator or a panel of arbitrators is generally chosen by the parties, which typically results in the selection of someone sophisticated and knowledgeable in the construction industry.

The Pennsylvania General Assembly is considering legislation that would require the design, construction, and renovation of certain state-owned or leased properties to comply with specified energy and environmental building standards. House Bill 34, the lead proponent of which is Representative Kate Harper of Montgomery County, is largely identical to a bill introduced last session.

A prior holding by the Supreme Court of New Jersey in Craft v. Stevenson Lumber Yard, Inc., declared that a construction lien claimant has a “statutory duty” under the Construction Lien Law “to allocate payments to the accounts from which they were derived”. In other words, contractors, subcontractors, and suppliers are not permitted apply payments originating from an owner on one project to another project to do things like pay off older debt. The Appellate Division’s recent decision in L&W Supply Corp. v. Joe DeSilva enlarges that obligation to one of inquiry based on reasonable suspicion.

After years with little to no change, the legislature in Pennsylvania has spent a good amount of time making revisions to the Mechanic’s Lien Law recently. Just last year we reported on amendments being considered; and more changes are being proposed to the statute as the General Assembly begins its 2013 session.