Details

Construction Law

An Introduction for Engineers, Architects, and Contractors
1. Aufl.

von: Gail Kelley
96,99 €
Verlag:	Wiley
Format:	EPUB
Veröffentl.:	28.08.2012
ISBN/EAN:	9781118360736
Sprache:	englisch
Anzahl Seiten:	320

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Beschreibungen

Titelbeschreibung

A clear, concise introduction to construction law for professionals Construction Law: An Introduction for Engineers, Architects, and Contractors offers a comprehensive review of the U.S. legal environment, focusing on the legal concepts and issues applicable to the design and construction industries. Topics covered include: <ul> <li>Basic legal principles</li> <li>Project participants</li> <li>Project delivery systems</li> <li>Construction contracts</li> <li>The design process</li> <li>Procurement</li> <li>Pricing construction projects</li> <li>Subcontractors and suppliers</li> <li>Time for performance</li> <li>Construction scheduling</li> <li>Contract administration</li> <li>The payment process</li> <li>Changes to the work</li> <li>Differing site conditions</li> <li>Termination of the construction contract</li> <li>Mechanic's liens</li> <li>Construction insurance</li> <li>Surety bonds</li> <li>Liability for defective construction</li> <li>Calculations of damages</li> <li>The Economic Loss Doctrine</li> <li>Alternative dispute resolution</li> </ul> This book serves as an excellent introduction to construction law for students as well as professionals in the construction industry.

Inhaltsverzeichnis

Preface xix 1 Law and Government 1 1.1 Introduction 1 1.1.1 The Powers of Governments 1 1.1.2 City and County Governments 2 1.1.3 The Powers of the Federal Government 2 1.2 The Sources and Hierarchy of Law 3 1.2.1 The Constitution 3 1.2.2 Statutes and Ordinances 3 1.2.3 Agency Regulations 4 1.2.4 International Treaties 4 1.2.5 Appellate Court Opinions 4 1.3 The American Judicial System 4 1.3.1 Structure of the Court Systems 5 1.3.2 Federal Trial and Appeals Courts 5 1.3.3 State Trial and Appeals Courts 6 1. 4 Common Law 6 1.4.1 Stare Decisis 7 1.4.2 Restatements of the Law 7 1.5 Legal Codes 8 1.5.1 Uniform Codes 8 1.5.2 The Uniform Commercial Code 9 1.6 Legal Doctrines 9 1.7 Choice-of-Law Clauses 10 1.8 Criminal Law versus Civil Law 11 1.9 Cause of Action 11 1.10 Summary Judgment 12 2 Basic Legal Principles 15 2.1 Legal Issues in Construction 15 2.2 Principles of Contract Law 15 2.2.1 Unilateral Contracts versus Bilateral Contracts 16 2.2.2 Oral Contracts 16 2.2.3 Third-Party Beneficiaries 17 2.2.4 Contract Interpretation 17 2.3 Principles of Agency Law 21 2.3.1 Apparent Authority 21 2.3.2 The Principal’s Liability for the Agent’s Acts 22 2.3.3 Ratification 22 2.4 Principles of Tort Law 23 2.4.1 Intentional Torts 23 2.4.2 Unintentional Torts (Negligence) 23 2.4.3 Strict Liability 27 2.4.4 Misrepresentation 28 3 Project Participants 29 3.1 The Owner 29 3.1.1 Access to the Building Site 30 3.1.2 Restrictions on Use of the Property 31 3.2 The Design Professional Team 31 3.2.1 Site Evaluation Consultants 32 3.2.2 The Geotechnical Consultant 33 3.3 The Construction Team 33 3.3.1 Subcontractors and Suppliers 34 3.4 Construction Lenders 34 3.4.1 Collateral Assignment to Lender 35 3.4.2 Other Lender Requirements 35 3.4.3 Construction Loans 36 3.4.4 Bond Financing 37 4 Project Delivery Systems 39 4.1 Design-Bid-Build 39 4.2 Multiple Primes 41 4.3 Construction Management 41 4.3.1 Agency Construction Management 42 4.3.2 Construction Management At-Risk (CMAR) 42 4.4 Design-Build 43 4.4.1 Design-Build Proposals 44 4.4.2 Advantages and Disadvantages of Design-Build 45 4.4.3 Bridging Consultants 46 4.5 Engineer-Procure-Construct (EPC) 46 4.6 Turnkey Construction 47 4.7 Integrated Project Delivery (IPD) 47 4.8 Fast-Track Construction 47 4.9 Public-Private Partnerships 48 4.9.1 History of Public-Private Partnerships 49 4.9.2 Constraints on Public-Private Partnerships 49 5 Construction Contracts 51 5.1 The Construction Contract 51 5.1.1 Prebid Conferences 51 5.1.2 Right to Reject Bids 52 5.2 The Contract Documents (Owner-Contractor) 52 5.2.1 The Contractor’s Bid 53 5.3 Conflicts between the Documents 54 5.4 Errors in the Documents 54 5.4.1 Latent Discrepancies 55 5.5 Specific over General; Written over Printed 56 5.6 Interpretation against Drafter 56 5.7 Specifications 57 5.8 Description of the Work under a Construction Contract 57 5.9 Third-Party Beneficiaries 58 5.10 Industry Standard Forms versus Custom Forms 58 5.10.1 Drafting Custom Forms 59 5.10.2 AIA Contract Documents 60 5.10.3 Engineers Joint Contract Documents Committee (EJCDC) 62 5.10.4 Consensus DOCS 63 5.10.5 Comparing the AIA, EJCDC, and Consensus DOCS Documents 64 5.10.6 AGC Forms 65 5.10.7 Other Industry Standard Forms 65 5.11 Commencement of Work Prior to Contract 65 5.11.1 Letters of Intent 66 6 The Design Process 67 6.1 Design Responsibilities 67 6.1.1 Contractor’s Responsibility for Design 67 6.1.2 Value Engineering 68 6.2 The Owner’s Program 68 6.3 The Design Agreement (Owner-A/E) 68 6.3.1 Schematic Design Phase 69 6.3.2 Design Development Phase 69 6.3.3 Construction Documents Phase 69 6.3.4 Bidding or Negotiation Phase Services 70 6.3.5 Construction Phase Services 70 6.3.6 Basic Services versus Additional Services 71 6.3.7 The A/E’s Compensation 71 6.4 Standard of Care Applicable to Design Services 71 6.4.1 Contractual Standard of Care 72 6.4.2 Proving Violation of the Standard of Care 73 6.4.3 Implied Warranties 73 6.4.4 Designing to the Owner’s Budget 74 6.4.5 The A/E’s Liability for its Estimate 74 6.5 Ownership of the Design Documents 75 6.5.1 Use of the Plans and Specifications 75 6.6 Termination of the Design Agreement 76 7 The Procurement Process 77 7.1 Selection of Contractors for Public Projects 77 7.1.1 The Bid Package 78 7.1.2 Duty to Award to the Lowest Bidder 78 7.1.3 Bid Responsiveness 78 7.1.4 Responsible Bidder 79 7.1.5 Bid Protests 80 7.1.6 Bid Security 81 7.1.7 “Best Value” Awards 81 7.2 Selection of Design Professionals 82 7.3 Alternatives to Design-Bid-Build in the Public Sector 83 7.3.1 Design-Build Construction in the Public Sector 83 7.4 The Federal Acquisition Regulation (FAR) 84 7.5 Procurement on Private Projects 85 8 Pricing Construction Projects 87 8.1 Fixed-Price Contracts 87 8.1.1 Fundamental Characteristic of a Fixed-Price Contract 87 8.1.2 Allowances 88 8.1.3 Material Price Escalation Clauses 88 8.1.4 Index Pricing 89 8.2 Cost-Plus Contracts 89 8.2.1 Labor 90 8.2.2 Subcontracted Work 90 8.2.3 Heavy Equipment 91 8.2.4 Small Tool Allowance 91 8.2.5 Reasonableness or Necessity of Costs Incurred 91 8.2.6 Contractor’s Overhead and Profit 92 8.2.7 Estimates and Cost-Plus Contracts 92 8.2.8 Timely Payment Discounts 93 8.2.9 Audit Rights 93 8.3 Cost-Plus with Guaranteed Maximum Price 93 8.4 Unit-Price Contracts 94 8.4.1 Variation in Estimated Quantities (VEQ) Clauses 94 8.5 Unbalanced Bidding 95 8.6 Bidding When the Design Is Incomplete 96 9 Subcontractors and Suppliers 97 9.1 Subcontractors versus Suppliers 97 9.2 Owner’s Control over Subcontractor Selection 98 9.3 Subcontractor Bids 98 9.3.1 Enforcing a Subcontractor’s Bid 99 9.3.2 The Subcontractor’s Right to Enforce Its Bid 100 9.4 Incorporation by Reference 100 9.5 Flow-down and Flow-up Provisions 101 9.5.1 Rights and Liabilities of the Parties under Flow-down Provisions 101 9.6 Duty to Cooperate and Coordinate Subcontract Work 102 9.6.1 Limiting the Liability for Coordination 102 9.6.2 Coordination of Multiple Primes 103 9.7 Subcontractor Payment 103 9.7.1 “Pay-If-Paid” versus “Pay-When-Paid” 104 9.8 Subcontractor Claims against the Owner 105 9.8.1 The Pass-through System 106 9.8.2 Liquidating Agreements 106 9.9 Conditional Assignment of the Subcontracts to the Owner 107 9.10 Minority and Disadvantaged Business Programs 108 9.10.1 Federal Minority and Disadvantaged Business Programs 109 9.10.2 Agency DBE Programs 111 10 Time for Performance 113 10.1 Time Is of the Essence 113 10.1.1 Time-Is-of-the-Essence Clauses in Construction Contracts 114 10.2 Date of Commencement/Time for Completion 114 10.2.1 Delays in Commencement of the Work 115 10.2.2 Waiver of Time for Completion 115 10.3 Substantial Completion 116 10.3.1 The Significance of Substantial Completion 116 10.3.2 Establishing Substantial Completion 117 10.4 Final Completion/Final Payment 117 10.4.1 Acceptance of Defective Work 118 10.5 Delays 119 10.5.1 Determining Whether a Delay Was within a Party’s Control 120 10.5.2 Delays Due to Weather 121 10.5.3 Concurrent Delays 122 10.6 Liquidated Damages 122 10.7 Constructive Acceleration 124 10.8 Right to Finish Early 124 10.9 Milestones 125 11 Construction Scheduling 127 11.1 Bar Charts 127 11.2 Critical Path Scheduling 128 11.2.1 Activity Logic 128 11.2.2 Arrow Diagramming 128 11.2.3 Precedence Diagramming 129 11.2.4 As-Planned (Baseline) Schedule 129 11.2.5 Float 130 11.2.6 Critical Path 130 11.2.7 Multiple Calendars 131 11.3 Scheduling Specifications 131 11.4 Schedule Updates 132 11.5 Resource Leveling 132 11.6 CPM-Based Methods for Proof of Delay Claims 133 11.6.1 Total Time Analysis 133 11.6.2 Impacted As-Planned (“What-If”) 134 11.6.3 Collapsed As-Built (“But For”) 134 11.6.4 As-Planned versus As-Built 134 11.6.5 Windows Analysis 135 11.7 Expert Witness Testimony 135 11.8 Using CPM to Estimate Extensions of Time 136 11.9 Using Bar Charts to Prove Delay Claims 137 12 Contract Administration 139 12.1 The A/E’s Role in Contract Administration 139 12.2 A/E’s Liability for Contract Administration 140 12.2.1 Approval of Shop Drawings and Other Submittals 140 12.2.2 Site Visits and Inspections 141 12.2.3 AIA B101 Provisions 142 12.2.4 The Right to Stop Work 142 12.2.5 Approval of Progress Payments 143 12.2.6 Responding to Change Order Requests 144 12.2.7 Requests for Information, Interpretations, and Clarifications 144 12.3 A/E’s Role in Contractor Termination 144 12.4 Initial Decision Maker (IDM) 145 13 The Payment Process 147 13.1 Progress Payments 147 13.1.1 Schedule of Values 147 13.1.2 The Application for Payment 148 13.1.3 Certification of Payment 148 13.2 Retainage 149 13.2.1 Payment of Subcontractor’s Retainage 150 13.2.2 Claims on Retainage 150 13.3 Accord and Satisfaction 150 13.3.1 Payment of an Accord by Check 151 13.4 Joint Checks 152 13.4.1 Joint Payee versus Alternative Payee 152 13.5 Title Insurance 152 13.6 Obligations of the Lender 153 13.7 Evidence of Financing 153 13.8 Prompt Payment Acts 154 13.8.1 The Progress Payment Request 154 13.8.2 Payment on Subcontracts 154 13.9 The Owner’s Payment Obligation on Private Construction 155 13.10 The False Claims Act 155 13.10.1 Liability for False Claims 156 13.10.2 Prosecution of False Claims 156 13.10.3 State False Claims Act 157 14 Changes to the Work 159 14.1 Contract Changes 159 14.1.1 Construction Change Directives 160 14.2 Pricing Change Orders 160 14.2.1 Determination of Price by a Third Party 161 14.2.2 Schedule Adjustments 161 14.3 Constructive Changes 161 14.3.1 Owner’s Direction or Improper Rejection of Work 162 14.3.2 Notice Requirements for a Constructive Change 162 14.3.3 Waiver of Notice Requirement 163 14.3.4 Extra Work versus Additional Work 163 14.4 Federal Government Contracts 163 14.4.1 Equitable Adjustments 164 14.4.2 Escrow of Bid Documents 164 14.5 Authority to Issue Changes 165 14.5.1 Apparent Authority and Ratification 165 14.6 Duty to Perform the Changed Work 166 14.7 Reservation of Rights 166 14.8 Changes Clauses in Subcontracts 168 14.9 Documentation of Costs 168 14.10 Cardinal Changes 169 14.10.1 The Contractor’s Options 169 15 Differing Site Conditions 171 15.1 The Purpose of the Differing Site Conditions Clause 171 15.2 Differing Site Conditions Claims 172 15.2.1 Type I—Conditions Materially Different Than Indicated 172 15.2.2 Type II—Conditions of an Unusual Nature 173 15.3 Limitations on Claims for Differing Site Conditions 174 15.3.1 Duty to Make a Site Inspection/Duty to Investigate 175 15.3.2 Disclaimers 175 15.3.3 Notice 177 15.3.4 Waiver of Claims 177 15.4 Variations in Estimated Quantities Clause 177 15.5 Geotechnical Baseline Summary Report 178 15.6 Hazardous Materials 178 15.7 Tort and Breach-of-Contract Actions 178 15.7.1 Misrepresentation (Intentional or Negligent) 179 15.7.2 Owner’s Breach of Implied Warranty of Plans and Specs 179 15.7.3 Failure to Disclose Superior Knowledge 179 15.7.4 Mutual Mistake 180 16 Termination of the Construction Contract 181 16.1 Unilateral Termination 181 16.2 Contractual Termination Provisions 182 16.3 Termination by the Contractor for Cause 182 16.4 Termination by the Owner for Cause 183 16.4.1 Notice and Opportunity to Cure 183 16.5 Wrongful Termination 184 16.6 The Role of the Performance Bond Surety 185 16.7 Termination for Convenience 186 17 Mechanic’s Liens 187 17.1 Purpose of a Mechanic’s Lien 187 17.2 Procedures for Filing a Lien 188 17.3 Lien Entitlement 188 17.3.1 Liens for Services 189 17.3.2 Liens for Materials 189 17.4 Enforcement of the Lien 190 17.4.1 Priorities 190 17.4.2 Bonding Off 191 17.5 Interests Subject to a Lien 191 17.5.1 Subcontractor and Supplier Claims 192 17.5.2 Amount of the Lien 192 17.6 Lien Waivers 193 17.6.1 No-Lien Contracts 194 17.7 Rights of Owners and Third Parties 194 17.8 The Effect of Bankruptcy on a Mechanic’s Lien 194 17.9 Trust Fund Statutes 195 17.10 Stop Notices 195 17.11 Liens on Public Property 195 18 Construction Insurance 197 18.1 Types of Insurance 197 18.2 Commercial General Liability 198 18.2.1 Bodily Injury and Property Damage 198 18.2.2 Exclusions to Coverage 199 18.2.3 Additional Insured Status 200 18.3 Builder’s Risk Insurance 200 18.4 Workers’ Compensation Insurance 201 18.5 Professional Liability Insurance 201 18.6 Wrap-up Insurance Programs 202 18.7 Waiver of Subrogation 202 19 Surety Bonds 205 19.1 Use of Surety Bonds in the Construction Industry 205 19.1.1 Bid Guarantees 206 19.1.2 Payment Bonds 206 19.1.3 Performance Bonds 208 19.2 Rights and Remedies of Sureties 208 19.2.1 Indemnity Agreements 209 19.2.2 Discharge of the Surety’s Obligations 209 19.3 Bonding Requirements 210 20 Liability for Defective Construction 211 20.1 Determining Liability 211 20.2 Owner Claims against the Contractor 212 20.2.1 Warranties 212 20.2.2 Notice Requirements 213 20.2.3 Tort Claims 213 20.3 The Spearin Doctrine 214 20.3.1 Application of the Spearin Doctrine 214 20.3.2 Limitations on Spearin 215 20.4 The A/E’s Liability for Defective Construction 216 20.5 Affirmative Defenses 217 20.5.1 Statutes of Limitation 217 20.5.2 Statutes of Repose 218 21 Calculations of Damages 221 21.1 Compensatory Damages 221 21.1.1 Consequential Damages 222 21.2 Punitive Damages 222 21.3 Duty to Mitigate Damages 223 21.4 Owner’s Damages 223 21.4.1 Owner’s Damages for Late Completion 223 21.4.2 Economic Waste 224 21.4.3 Betterment 224 21.5 Contractor’s Damages 226 21.5.1 Equipment Costs 226 21.5.2 Home Offi ce Overhead 227 21.5.3 Cost Increases for Labor and Materials 228 21.5.4 Methods of Estimating Loss of Productivity 228 21.6 Limitation of Liability 230 21.6.1 Exculpatory Clauses 230 21.6.2 Indemnification Agreements 231 21.6.3 Limitation-of-Liability Clauses 232 21.6.4 Waiver of Consequential Damages 233 21.7 Specific Performance 234 21.8 Tort Claims 234 21.9 Recovery of Damages in the Absence of an Express Contract 235 21.9.1 Reliance Interest—Promissory Estoppel 235 21.9.2 Implied-in-Fact Contracts—Quantum Meruit 236 21.9.3 Restitution Interest—Unjust Enrichment 236 21.9.4 Quantum Meruit versus Unjust Enrichment 237 22 The Economic Loss Doctrine 239 22.1 Tort versus Contract Law 239 22.1.1 Definition of Economic Loss 240 22.1.2 Development of the Economic Loss Doctrine 240 22.1.3 Basis for the Doctrine 241 22.1.4 Public Policy Considerations 241 22.1.5 Strict Application of the Doctrine 242 22.1.6 Exceptions to the Economic Loss Doctrine 242 22.2 Claims of Defective Construction Products 243 22.2.1 Damage to Other Property 244 22.3 Claims of Defective Construction Services 244 22.3.1 Claims of Defective Design Professional Services 245 22.4 Potentially Dangerous Products (Risk of Harm Exception) 246 22.5 Negligent Misrepresentation 247 22.5.1 Negligent Misrepresentation Claimants 247 22.5.2 Tort versus Contract Claims for Negligent Misrepresentation 248 23 Alternative Dispute Resolution 249 23.1 Arbitration 249 23.1.1 Arbitration Clauses 250 23.1.2 Arbitration Statutes 250 23.1.3 Arbitration Organization Rules 251 23.1.4 Prehearing Activities 251 23.1.5 Selection of Arbitrators 252 23.1.6 The Arbitration Hearing 252 23.1.7 The Award 252 23.1.8 Appealing the Award 253 23.1.9 Costs of Arbitration 254 23.1.10 Typical Schedule for Arbitration 254 23.1.11 Joinder and Consolidation 254 23.1.12 Waiver of Arbitration Rights 255 23.1.13 Effect of Arbitration on the Surety 256 23.2 Litigation versus Arbitration 256 23.3 Mediation 257 23.4 Other Types of Alternative Dispute Resolution 258 23.4.1 Med/Arb 258 23.4.2 Mini-Trial and Summary Proceedings 258 23.4.3 Dispute Resolution Boards 259 23.4.4 Standing Neutrals 260 23.5 Dispute Prevention 260 Appendix A: List of Abbreviations 261 Appendix B: Table of Cases 265 Appendix C: Understanding Case Citations 267 Glossary 271 Index 279

Autorenportrait

GAIL S. KELLEY is a Professional Engineer and LEED Accredited Professional as well as a licensed attorney in Maryland and the District of Columbia. Gail has an extensive background in design and construction having worked in construction management, structural design, and structural evaluation.