Emerging Design-Build Issues
We recently made a presentation to the Northwest Construction Consumers Council (NWCCC) on emerging legal issues in design-build. You can access a copy of our presentation here Download file
Fee Award Vacated in Motion to Compel Arbitration
The prevailing party fee clause in this case said that fees would be awarded in connection with any action to collect sums due. What about prevailing on a motion to compel arbitration to decide the debt collection dispute -- is that enough to trigger the fee clause? The Supreme Court said no -- legal fees are not yet due because the merits of the case had not yet been decided -- and thus vacated an award of fees which had been granted to Belfor USA in a dispute with an owner. The Court hinted the outcome might have changed if the clause had been written differently (i.e., awarding fees to the prevailing party for enforcing a contractual term).
Copy of opinion (Belfor v. Thiel) also available here Download file
Lagoon Loss Excluded By "Faulty Workmanship" Clause in All-Risk Policy
The loss in this case occurred when a dredging contractor, hired to remove biosolids from a city wastewater lagoon in Oak Harbor, accidentally punctured the lagoon's liner.
As with most all-risk policies (such as builder's risk policies), there was an exclusion which prohibited coverage for loss due to "faulty workmanship" of the builder.
Long story short: coverage denied. The tearing and puncturing of the liner was bad workmanship whether looked at from a tort or contract standard, the Court held.
Copy of decision also available here Download file
Court of Appeals Declines to Apply FAA to Washington Condo Project
Under Washington's Condominium Act, a unit purchaser is guaranteed the right to pursue judicial relief for breach of the statutory warranties. The issue is this case is whether this right of judicial access is trumped by federal law (specifically, the Federal Arbitration Act or FAA) so as to compel private arbitration of the disputes. Division 1, by a 2-1 vote, held that the federal FAA did not apply to a "garden variety" real estate development within Washington and therefore allowed the claimant to proceed in court rather than be compelled to arbitrate.