Best Practices Construction Law : Construction Lawyer & Attorney : Matthew DeVries : Stites & Harbison Law Firm : Green Building & LEED Litigation

We all need to hear stories of determination, hope and recovery. It's what the construction industry as a whole wants to see happen.  It's what our economy needs to see happen.  It's what local construction laborer Rodney Johnson embodies.

From our friends at Trojan Labor in Nashville, I wanted to share a great interview with one of their construction laborers.  Unemployed and wanting to make it on his own, Rodney left Florida over six months ago.  And here is what he had to say:

Trojan Labor Nashville: Rodney, how difficult was it to leave your home, family ... friends?

Rodney Johnson: Really difficult. But I felt kept, like a house cat. I wanted to earn my own.

TLN: What did you do when you got to Nashville? Did you have a place to stay?

RJ: I had to stay at the mission. (Nashville Rescue Mission). It's a good place to try to save your money until you get to the next level. I could walk from there to Trojan Labor every day.

TLN: I didn't even know that it was walking distance.

RJ: Sure, I'd get some exercise.

TLN: What happened here at Trojan Labor?

RJ: I did all the paperwork and they didn't treat me any different...me coming from the mission and all.

TLN: Did you work right away?

RJ: Yes, pretty much right away.

TLN: And was work available every day or was it sporadic?

RJ: I'd say most of the time I was working. There were probably a couple of days I didn't work. Most of the time I was working.

TLN: That tells me you were here at 5 am every morning. And you'd already exercised...
(We laugh)

TLN: Tell us about the work you were sent out on. How was it on a day-to-day basis? How were treated. And no need to sugar-coat it.

RJ: I was treated real well but I have to admit, though, on the bigger jobs, when they saw me coming with my long hair (I'd cover it with a hat) but I think maybe they thought I wasn't serious.

TLN: Because of the way you looked?

(He shows me dreadlocks that've been tucked into his jacket).

RJ: Yeah. But after a few days, they took me seriously.

TLN: Oh, so you were asked back?

RJ: Yeah, they give me a repeat. (For our readers: a "repeat ticket" is when an employer requests a particular worker back.)

TLN: That's cool - so you were judged on your work, then, in the end?

RJ: You have to prove it to employers - that you're really serious about working. They want to see that you will work, and that you're willing to work, that you're awake and alert and that you're not coming to work with any other distraction. I think if your expectation for yourself is even higher than theirs... if you're 'stand up', then they'll respect you.

TLN: So no complaints?

RJ: Except getting lost in big buildings!  (laughter)

TLN: What are your hopes for the future, Rodney?

RJ: (big smile) I hope to be the leader of a reggae band.

TLN: Well, this is the right city for it! Wow. You sing?

RJ: Sing, write, play guitar, drums. I was born with some talents and I gotta keep the dream alive. Even though I work every day. I'm keeping the dream alive... that one day I might be able to do that.

TLN: Well, we hope so too! Thank you so much, Rodney, it's our pleasure at Trojan Labor to know you.

___________________________________

Thanks to Jolene Dressel at Trojan Labor for sharing this interview and best wishes to Rodney and other laborers this holiday season.

• Email This
• Print
• Comments

As a construction lawyer involved in complex litigation, I am often asked to prepare a "litigation and discovery budget" for a client.  As a construction client, your stomach may turn when you receive one of these budgets from your lawyer.  Is there a way to control the costs of discovery in construction litigation? 

According to the International Institute for Conflict Prevention and Resolution (the Center), the answer can be found in what is known as an economical litigation agreement.  According to the FAQ published by the Center [pdf], the Agreement is like a "litigation prenup" that is intended to reduce the costs and delay of discovery according to the size of the matter.  The procedures can be incorporated into a construction contract as follows: 

Economical Litigation Agreement: Any Dispute arising out of or relating to this contract, including the breach, termination or validity thereof, whether based on action in contract or tort, shall be finally resolved by civil litigation in accordance with the International Institute for Conflict Prevention & Resolution Economical Litigation Agreement (2010 edition), by a judge sitting without a jury. In jurisdictions where advance waiver of jury is prohibited as a matter of law, or where all parties to this agreement subsequently agree in writing, such Dispute shall be decided by a jury.

If litigation ensues, the parties are bound by the procedures in the Economical Litigation Agreement, including a limited scope discovery procedure in lieu of conventional discovery.  Discovery requests are limited and sized proportionally to the amount in dispute. For example, for disputes up to $10.0M, 15 interrogatories and six four-hour depositions are permitted. Discovery disputes are to be resolved by a specially trained arbitrator via telephone conference and with limited briefing.  Other areas addressed by the Agreement include: 

1. Waiver of jury trial
2. Escalating negotiations and mandatory mediation
3. Waiver of service of process
4. Responsive pleadings by letter or email
5. Page limit on motions (3 pages)
6. Executive summaries provided with each affidavit submitted
7. Waiver of oral argument on most motions
8. Mandatory discovery with non-electronic discovery limits
9. Limits on number of interrogatories, document requests and requests for admissions
10. Use of informal witness interviews

As with all other things in the construction world ... it looks good on paper.  But I am interested in hearing any feedback from those who have used the Center's alternative to traditional arbitration and litigation.  Anyone?

Image: chbrenchley

• Email This
• Print
• Comments (3)

I realize that many different types of people read this blog: contractors, architects, consultants, homeowners, lawyers ... and the list goes on.  Despite our differences in vocation or industry, I think we all have a few things in common: (1) we all will face adversity in our lives; (2) we all have desire to be better than we actually are; and (3) we all have the ability to improve.  Do you agree?

Former construction attorney and current coach to lawyers, Cordell Parvin, has challenged me over the past few months in my professional and personal development.  At Cordell's pushing, I drafted an article on my first ten years of practice that was published by The Practical Lawyer.  Although the "lessons learned" relate to my development as a lawyer, there are certainly some life lessons for contractors and other executives.

Years before my first law class, I thought I was ready to practice law.  At the time, I was already working as a law clerk at a personal injury firm.  My job entailed interviewing witnesses, preparing and responding to discovery requests, and drafting legal memos and briefs.  Among these tasks, I enjoyed legal writing the most.  In fact, I had drafted trial court briefs, administrative agency statements, state and federal appeals, and even a writ of certiorari to "the Supremes" in Washington.  Based upon all this work, I was confident about my preparation for the practice of law.  However, a few stumbling blocks remained in my way to becoming a successful attorney, including a bar exam, many non-billable articles and conferences, hundreds of soiled diapers, and tens of thousands of dollars in debt.  Click here to continue reading this article in its entirety.

Image: Kim Vetter Photography

• Email This
• Print
• Comments (4)

I am on the board of the Construction Leadership Council of the AGC of Middle Tennessee.  Earlier today, we presented a check to the Ronald McDonald House Charities to help support their great work for sick children and their families in and around Nashville, Tennessee. 

As I drove back to the office, I thought about the importance of helping others ... and specifically the impact of giving to others.  I recently heard a Jewish reading about giving:

THERE ARE eight degrees in the giving of Tsedakah, each one higher than the next:

to give grudgingly, reluctantly, or with regret;

to give less than one should, but with grace;

to give what one should, but only after being asked;

to give before one is asked;

to give without knowing who will receive it, although the recipient
knows the identity of the giver;

to give without making known one’s identity;

to give so that neither giver nor receiver knows the identity of the other;

to help another to become self-supporting, by means of a gift, a loan,
or by finding employment for the one in need.
 

Contractors are giving at every level.  Last night, Hardaway Construction and LP Building Products won the AGC of Middle Tennessee's Community Outreach award for their participation in the construction of Lighthouse Christian School featured on Extreme Home Makeover. In addition, AGC's Operation Opening Doors is helping renovate a home for a Las Vegas family struggling with medical issues.  

So, at which level are you or your company giving? 

• Email This
• Print
• Comments (1)

As the college football seasons comes to an end, USA Today had a special report on the salaries of coaches, as well as a great article on coaches' contracts.  The article described how some schools have the freedom to include "unusual provisions" in their contracts. 

How's that for bargaining?  Middle Tennessee State coach Rick Stockstill's contract includes a provision that if he terminates his agreement without cause and signs with another Division 1 school, then MTSU can accept either a $200,000 payment from Stockstill or require his new school to enter a contract to play a game with MTSU.  Purdue's coach Danny Hope was more concerned about his personal affects, as his contract allows him to keep personal items and records, including playbooks, notebooks and other documents, upon termination or expiration of his contract. 

Did you know that you can be equally creative with your construction contracts?  A contract is about defining transactions and relationships. It is a set of instructions that "instructs" the parties on how to perform in various circumstances.  Although the contract should have some standard "must-include" provisions, you can include special language to address any situation conceivable.  Here are some examples:

• Consider a cost-savings bonus.  Many construction projects include a cost-plus price, which means the owner pays the contractor the cost of the work plus a fee for the contractor's services.  In this instance, the parties may consider including a guaranteed maximum price.  To provide an incentive for the contractor to come in under budget, parties often include a cost-savings bonus where the parties split any savings. 
• Consider an early completion bonus.  Many times you hear about liquidated damages and penalties assessed against the contractor for delays in completion of the work.  As an incentive to get the work completed before schedule, consider including an early incentive payment.  But be clear in your words, as one contractor recently had to litigate the issues of an early completion bonus because the owner would not pay.
• Consider non-monetary compensation.  Just as football coaches are thinking outside the box on their contracts, parties to a construction contract (whether owner, contractor, subcontractor or supplier) can be creative with the compensation.  Perhaps this construction contract may be the basis of a supplier contract that includes other projects and bulk savings for materials.  Perhaps the owner wants to negotiate a shorter warranty period with unit prices for certain repair and maintenance items. 

There are few limits (...perhaps statutory prohibitions...) to what the parties can include in their construction contract.  Think outside the box.

Image: pobrecito33

• Email This
• Print
• Comments

I woke up very early this morning so that I could get a jump start on all the work projects that need to get done before the Thanksgiving weekend.  As I tiptoed down the hallway, the rumbling little snores of 6 children made me smile.  Yep, I am thankful for many things ... but especially family and friends.  I wish you the best this Thanksgiving Holiday.

If you are traveling by vehicle this weekend, did you know that road construction projects in many states take a holiday, too?  For example, The Tennessee Department of Transportation is halting all lane closure activity on interstates and state highways in anticipation of higher traffic volumes this weekend from noon on Wednesday, November 24 until 6:00 a.m. Monday, November 29.

The lane closures certainly help alleviate some of the traffic congestion this week.  However, it will also impact all of the construction activities and project schedules.  When preparing the construction schedule for the holidays, here are a few tips: 

• Remember to include the public holidays and extended days. You would be surprised that regular holidays are sometimes left out of the schedule.  It is equally important to account for extended days, even where the public holiday may only be one day.
• Move critical tasks before or after the holidays. Distractions during this time will undoubtedly affect morale, concentration and longevity. People want to be with their families and productivity often suffers.
• Account for lighter days beginning the second week in December. While you don't have to write off the entire month of December, a realistic schedule of work allocates a lesser number of hours per day as your approach year end.
• Encourage your project team to hit goals during limited work times. The project manager is not going to get very far by pressuring the team with threats and commands. Instead, create an incentive for productivity—i.e., perhaps a shopping gift card or gift certificate for a restaurant.

Some project managers, consultants and experts allocate seven hours in a regular day because workers realistically are not productive for a full eight hours. The best way to ensure quality work from your construction employees during the holidays is to plan for the inevitable loss of productivity.

Image: amy.sept

• Email This
• Print
• Comments (1)

I have often wondered whether there is such a thing as too small a dispute.  Well, the parties in Earl Faulkner v. Tom Emmett Construction Company (pdf) determined to take their $3,000 construction dispute to the Tennessee Court of Appeals.  In the end, the Court gave some good instructions on the "first material breach" rule, which applies in many states.

 The Owners hired the Contractor to build a new driveway at their home.  The total contract price was $18,000 and the Owners refused to pay the balance of $8,000 because they were dissatisfied with the workmanship of the driveway.  The Owner sued the Contractor, seeking the cost to remove and replace the allegedly defective driveway. The Contractor claimed that the driveway was properly constructed and filed a counterclaim for the remaining $8,000 balance owed on the oral contract.

The trial court concluded that any problems with the driveway were not sufficient to require that it be removed and replaced.  Because there was a problem with how the concrete on one portion of the driveway had been poured, the trial court ordered the Owners to pay only $5,000 of the remaining
$8,000 owed on the contract.

The appellate court affirmed the findings of the trial court, but modified the judgment.  The court held that the Contractor committed the first material breach of the contract when it failed to construct the driveway in accordance with the plans.  Accordingly, the Owner was relieved of any obligation to pay:

A party who has materially breached a contract is not entitled to damages stemming from the other party’s later material breach of the same contract. Thus, in cases where both parties have not fully performed, it is necessary for the courts to determine which party is chargeable with the first uncured material breach.

. . . We conclude that [Contractor's] admitted failure to use a gravel base prior to pouring the driveway extension constitutes a material breach of the contract, thereby prohibiting [Contractor] from challenging [Owner's] later material breach of failing to pay the balance of the contract price.

Based upon the above reasoning, the appellate court concluded that the Owner was not required to pay the remaining $3,000 breach of contract damages awarded by the trial court. 

While the amount in controversy in Faulkner does not seem significant, the decision provides a good illustration of the first material breach rule.

Image: DavidDMuir

• Email This
• Print
• Comments

You may have noticed that I recently transitioned to a new law firm this week.  I am happy to announce that I have joined Stites & Harbison PLLC as a partner in the Construction Service Group and the Green Law Practice Group.  The past few weeks have seemed like a tropical storm ... and the only thing to do is ride the waves of change.

What do I mean by riding the waves of change?  As a construction attorney for the past ten years, I have realized that the industry is always in a state of flux.  During strong economic times, I have a lot more contract drafting and project administration work.  During hard economic times, I have a lot more construction litigation and mechanic's liens.  I've learned to adjust to the circumstances to meet the needs of my clients.

Whether you are dealing with a new safety policy on the site,  a difficult personality on the design team, an estimate error that is going to affect the bottom line, or even a potential transition to a new job, here are a few things you can do to ride the waves of change:

• Understand that change is going to happen.  Whether you are talking about your professional career or your personal life, there will be change.  You can count on it.  I can guarantee it.  Most of the time, those people who fail to recognize change have the hardest time adjusting to it.
•  Understand that change and your responses will come in stages.  Consider a fatal workplace accident.  Undoubtedly, your construction company will go through numerous changes in response to this incident, including the initial shock of the accident, feelings of potential guilt, assessment of safety measures, analysis of liability, and the transition of duties and potential change in policies.  Change of any sort comes in stages.
• Understand that communication leads to success.  Communications is always important, but it is especially important when you face change.   Practically speaking, you need as much information about the change as possible, so that you can make an intelligent decision. Talk to your boss, your boss’s boss, and your co-workers to get their understanding of the situation. Be honest in all your discussions and deal with the problems when they arise.
• Understand that flexibility is good.  Change requires flexibility and the ability to adapt.  The better able you are to respond to change, the more likely you will succeed. Make an assessment of the situation, identify potential outcomes, plan and develop a response strategy, and then begin to ride the wave.  Maybe your current job isn't what you expect?  Perhaps the new workplace policy strains the ingenuity of your employees? Try to be flexible with an understanding of the potential outcomes.  Part of the fear of change often involves dealing with the unknown.

In my situation, communication and flexibility on everyone's part has enabled a good transition.  I am sad to leave such a well-respected practice in Nashville.  However, by joining one of the oldest law practices in the nation and among the largest law firms in the Southeast region, I am thrilled at the opportunity to help build one of the strongest construction groups in the Southeast.  I will miss all my former colleagues ... but who knows ... I may see them in court!

 Image: Michael Dawes

• Email This
• Print
• Comments (3)

And I only have 18 days until my test ... because I am taking the test on the "second to last" day.  If you are wondering why I am calling it the "last" LEED AP 2.2 test, GreenSource explains the basic requirements of the new LEED categories, including an easy-to-read chart of credentials.  If you have not already registered for the version 2.2 test, then it's too late.  If you have registered, then you should already have a scheduled test date ... and June 30, 2009 is the last possible date to take the LEED AP 2.2 test.  If you already passed, BuildingGreen.com explains what it means for you.

I know there are endless resources (...free and not-so-free.,.) out there that can help you prep for the exam.  Well, thanks to my partner Vic McConnell (...Mom always liked you best...) who passed the exam last week, I have a plan of action.  With the obligatory disclaimer (...there are no guarantees that you will pass if you follow this method...), here are some of the materials that I am using for my preparation: 

• USGBC Reference Guide (LEED Reference Documents)
• USGBC Colorado Chapter Study Guide (Test)
• intheleed.com (LEED AP Walkthrough; audio files)
• Greenexamprep.com (5 sample tests; flashcards)
• GBCI Candidate Handbook
• University of Florida "Learning to Leed" website
• Leedexamstudy.com (online courses)
• Summary Chart ... homemade
• Memory Chart ... homemade

Here is a list of substantive issues that I am focusing on for the test:

• Certification ratings and points
• Six credit categories (WIMSIE)
• Code/Standards referenced (especially ASHRAE)
• Exemplary Performance Credits/ID Credits
• Project registration
• Project certification process
• CIR process (Credit Interpretation Rating)
• Appropriate rating system (LEED-NC)
• Certification application & fees
• Prerequisites
• Introductory sections to each credit
• Submittals for each credit
• Submittal phases
• Commissioning (EAP1 & EAc3)
• Synergies between credits
• Relations between SS 6.1 & 6.2; SS 5.1 & 5.2; and SS 7.1 & 7.2
• Energy Performance credits EAP2 & 1
• EQ Credits (3.1 – 3.2)
• EQ Credits (4.1 – 4.4)
• Water efficiency  – plumbing fixtures involved
• Project administrator duties

 All you LEED-ers, did I miss anything? 

• Email This
• Print
• Comments (2)

It is official.  The Construction Blawg  is retired.  For a number of years, I maintained a construction-related blog called The Construction Blawg … which was highlighted by the ABA Journal Law News Now.  While all of the posts are archived, we may have a difficult time resurrecting the content given the internal hyperlinks and coding and expiration of our domain.  (… for you non-techies, that means that there are a lot of codes within each post that will have to be manually changed … )

Although The Construction Blawg has been retired, I am returning to the cyberworld with Best Practices Construction Law.  You will see some of the old regulars like Rip Rap (...focusing on those random construction stories...), but you will also see some new commentary … with a great emphasis on issues like Green-Building, Technology, Building Information Modeling, Great Tips on Project Management and Alternative Dispute Resolution.

Another significant change in The Construction Blawg family is that I now have five … yes, that’s right … FIVE children … and four of them are under five years old!  So I will have some great stories to tell you, which hopefully will shed light on some best practices in the construction industry.  No, really.  Trust me.

So, out with the old … in with the new!  Make sure you check back regularly.

• Email This
• Print
• Comments