Volume 6 - Number 30 | July 28, 2008 - Construction Claims Advisor

Sample Issue

Bookstore

Editorial Board

Construction Law Sites

Past Issues

Press Releases

Forums

You are here: Home » Volume 6 - Number 30 | July 28, 2008

Volume 6 - Number 30 | July 28, 2008

EDITOR'S NOTES | Issue 6-30: There’s something to be said for initiative, especially in business. However, good business practices dictate that you don’t begin work on a project until the ink is dry on the contract. Otherwise, you expose yourself to liability and payment problems, among other things. On an Indian reservation roadway project, a subcontractor got to work, knowing the prime contract still wasn’t signed. When its work stalled, it couldn’t pursue claims against the payment bond for work occurring before bond issuance.

Ambiguous and clear-cut contracts provide the backdrops to this week’s other two case summaries. In one, the court had to decide if the contract excused the contractor from negligent performance. And in the other summary, though a contract clearly negated a contractor’s fiduciary duty, the contract could not contradict a state law that placed a burden of trust on the contractor.

PAYMENT BOND CANNOT APPLY TO PRE-CONTRACT COSTS: Construction costs incurred before a payment bond is issued may not be protected by the bond.

DISCLAIMER OF CONSEQUENCES RULED UNENFORCEABLE: Ambivalence in a contract leads to questions of whether a contractor could be excused for its own negligence.

AIA PROGRESS PAYMENT CLAUSE DID NOT NEGATE STATE TRUST STATUTE: A contract may contain verbiage disclaiming a trust or fiduciary duty for progress payments, but it does not release the contractor from adhering to a state trust statute.