Washington Construction Law Blog

A contractor hired by the federal government to expand a levee in Louisiana requested an equitable adjustment to its contract for extra labor and material costs. The claim was written by an outside consultant who lacked personal knowledge of the events. The goverment brought a pretrial motion in limine to exclude the consultant's claim, arguing it lacked any shred of reliability.

As often happens with such motions, the Court of Federal Claims ruled the objection went to the weight of the claim rather than its admissibility, and denied the motion on that basis. In doing so, however, the Court also addressed an issue which arises in many construction claims: when is a party allowed to submit a "summary" of voluminous evidence under ER 1006? For reasons described in the opinion, the Court held in this case the "summary" failed to meet the four-part test of ER 1006 and thus the case provides useful guidance to those who may wish to rely on "summary" evidence at trial in Washington as well.

The Farm Bureau has officially launched its expected campaign to take a proposed initiative to voters in November 2006 for adoption of a property rights law which -- depending on who you ask --is either similar to or different from Oregon's Measure 37. An Oregon trial court struck down Measure 37 on constitutional grounds and the Oregon Supreme Court heard oral argument on January 10 in the resulting appeal.

The accepted wisdom is that a liquidated damage clause in a construction agreement is the exclusive remedy for time-related damages. Here's a new case that seems to follow the accepted wisdom and perhaps go a bit beyond, holding the LD clause to preclude any type of additional "actual damages."

Given the preclusive effect of LD clauses, sometimes an effort is made to carve out exceptions or to make the clause alternative at the option of the owner -- that is, to permit the owner to collect either the LD amount or actual damages, whichever is greater. But the "optional" may not be enforceable if this case were to be adopted in Washington.

Jacobs Engineering has won its case against the federal government in a dispute over the proper sum to be awarded a government contractor in the event of a convenience termination. The contract was written on a cost-sharing basis, pursuant to a federal regulation allowing such contracts, and Jacobs was to be paid only 80% of its costs under this arrangement and no fee.

But when the government said it ran out of money for the project (a gasification facility), it nixed the project for convenience and Jacobs promptly submitted a settlement proposal embracing "all" of its costs as seemingly allowed under the separate convenience termination clause.

By a 6-3 vote, the Supreme Court today upheld the validity of Olympia's method of calculating the sum to be paid for traffic impact fees for new developments. In a nutshell, the city has broad authority under the GMA and need not make "individualized assessments" as urged by the developer. The dissent -- Johnson, Sanders and Chambers -- would have required such a showing.

While there is nothing especially groundbreaking about this new case, it does illustrate the legal grounds why owners most often avoid liability for injuries sustained by workers hired by independent contractors doing work on the construction site.

At the crossroads of telecom and construction law, here's a 9th Circuit decision handed down today which forbids a city from denying a permit to install a wireless antenna based on aesthetic concerns.

Now that we're into Day 25 of the rain streak, we feel obligated to post some additional humor -- this time a rotating collection of blooper photos maintained by an excellent defect expert witness & forensic consultant in the Seattle area.

Our tour of scheduled Supreme Court cases now stops at this case, which involves some fairly dense issues of surety law - specifically, whether a surety’s obligation to a contractor on a subcontractor’s performance bond was conditioned on the contractor declaring a default before the subcontractor substantially completed the work. The Court of Appeals said no, holding the surety (ICW) was liable on the subcontractor bond even absent a formal declaration of default. Not exactly your everyday issue since a true default is ordinarily assumed, but interesting nonetheless.

Ruling that the owner had exceeded the scope of its license to use copyrighted architectural plans, the 9th Circuit on January 11 filed an opinion entering a preliminary injunction in favor of the design firm prohibiting the owner's illegal use. The case stems from a large residential development in Nevada. The opinion contains not only a useful summary of copyright law as applied to design instruments, but also will excite all students of federal jurisdiction with its application of mootness doctrines.

The Idaho bid protest over project management services for the state's $1.2 billion road rehab plan, covered earlier in WCL, has ended -- not surprisingly with contract awarded again to the original winner (Boise-based Washington Group). PB dropped its protest.

You might call this a monster changed condition. View image

Per order of the Supreme Court, Jeff Poole has been suspended from practicing law for a period of six months - followed by two years of probation.

The prevailing wage dispute at issue in this case to be heard this term by the Supreme Court is whether truck drivers who delivered fill material to the location where it was used in the Sea-Tac Third Runway Embankment Project were entitled to local prevailing wages under RCW 39.12.020 because they thereby participated in the "incorporation" of the delivered materials into the project. See WAC 296-127-018(2)(a). The Court of Appeals said no, and thereby relieved the dirt subcontractors from having to pay the prevailing wage rates.

Gotta love this one. Download file

And here is this year's attempt to overturn the Mike Johnson case, which held that notice clauses in construction contracts are to be strictly enforced without regard to whether the late notice caused the owner to suffer prejudice as a result. Similar legislation failed in 2005.

Today is the first day back for the Legislature and WCL will be tracking bills of concern to the industry on a periodic basis. First up is this proposed bill requiring owners to pay up to $10,000 when they reject all bids and start anew on a particular procurement after the bids are opened.

Also on tap in the January term is Lakemont Ridge Homeowners Ass’n v. Lakemont Ridge Ltd. P’ship, which will decide whether a homeowner’s obligation under RCW 64.50.020 to provide notice of claim before filing a defect suit against a “construction professional” is contingent upon the construction professional having first informed the homeowner of the prelitigation notice requirement. See RCW 64.50.050. The Court of Appeals said no such contingency existed, and thereby barred the owner from bringing claim without first providing the statutory notice. Download file. Oral argument in March 2.

The new Supreme Court term is about to begin and it brings a bumper crop of issues of concern to the industry. We'll spotlight these cases in upcoming posts.

For now, one interesting case to keep an eye on is Ballard Square Condo. Owners Ass’n v. Dynasty Construction Co., which looks at the issue of whether a condominium owners association may sue a contractor corporation on a breach of contract claim that arises after the corporation dissolved. The Court of Appeals said no. Download file Oral argument is scheduled for March 2.

Abbott Labs wanted to build a new basement for its manufacturing facility. To do so, it had to pump out a lot of groundwater. But this pumping depleted groundwater in neighboring property as well, where pecan farmers had maintained trees whose roots depended on a water level of about 16 feet. After the pumping, the water table was permanently suppressed to 32 feet. The trees died.

Relying in significant part on a 1935 Washington case, the Ninth Circuit recently held that the owner owed no duty of care to neighboring landowners.