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Contract appeals board recognizes that discovery may uncover new claims

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In Amec Foster Wheeler Environment & Infrastructure, Inc. v. Department of the Interior, CBCA 5168 et al. (Feb. 27, 2019), the Civilian Board of Contract Appeals (CBCA or Board) recently reiterated that a contractor need not assert every conceivable legal theory of relief as soon as it encounters an unforeseen condition on a construction project.

Rather, a contractor may later be able timely to assert additional claims under distinct theories based on operative facts learned during discovery. Apropos of recently celebrated St. Patrick’s Day, this case indicates that discovery may be the rainbow that leads a contractor to a bigger pot of gold, i.e., operative facts that permit assertion of more valuable claims based on alternative legal theories.

The Case

In 2011, the National Park Service awarded Amec a contract to repair parts of the Alcatraz Cellhouse in the historic prison on Alcatraz Island. In January 2016, Amec appealed a contracting officer’s decision denying an equitable adjustment and schedule extension under theories of constructive change and breach of the duty of good faith and fair dealing. The Board docketed that appeal as CBCA 5168.

During discovery, Amec decided to allege alternative grounds for relief. Indeed, in August 2018, Amec submitted a new claim for more money than it sought in the already docketed appeal — based on different operative facts and under the distinct theories of superior knowledge and negligent estimates. Amec appealed the denial of that second claim to the Board, which was docketed as CBCA 6298 and consolidated with CBCA 5168.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2019/03/cbca-recognizes-that-discovery-may-uncover-new-claims/

Preparing to bid in a new state

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If you’re expanding your business, you’ve got to put together a game plan — especially if you’re expending into other jurisdictions.

When a client is so pleased with your work on one project that they offer up more business, sometimes the invitation is sweeping, with the potential to dramatically expand your company’s footprint. No one wants to turn away work, particularly from a valued client.

But, if those projects are in jurisdictions that are new to the company, there will be some regulatory homework to do before making a commitment.

What licenses, paperwork, agreements, etc. will you need to do the work? Are exams required? Depending on the answers to these questions, and the processing times of the various jurisdictions, the licensing process can take anywhere from 1 to 6 months. So, how can you answer a client’s request confidently when opportunity comes knocking?

Consider using a business licensing provider with experience dealing with architecture, engineering and construction (AEC) firms. They can provide accurate time estimates for specific licenses and jurisdictions and have the knowledge to ensure timely file preparation, review and approval. Another option is to hit the books and research licensing requirements within the project’s jurisdiction(s).

Keep reading this article at: https://www.constructionbusinessowner.com/law/regulations/preparing-bid-new-state

String of infrastructure investments underway hints at big 2019

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Infrastructure work may be heating up again with whisperings of President Donald Trump’s administration reinitiating the $1 trillion infrastructure plan promised during his 2016 presidential campaign. The administration claims to be willing to increase the federal share of the infrastructure program significantly from the 20% referenced in previous iterations — a move that may draw Democrats back into negotiations.

Whether federal legislation will come to fruition or not in 2019, investments nonetheless are being made in the space. A December Wall Street Journal analysis of state and local revenue collection and spending found that public agencies are increasing their infrastructure investments and making headway on long-delayed projects. Much of that money is tax revenue stemming from increased consumer spending.

Although it’s hard to predict what 2019 may bring, Construction Dive has rounded up some of the biggest infrastructure initiatives already underway across North America as the year begins.

Keep reading this article at: https://www.constructiondive.com/news/string-of-infrastructure-investments-underway-hints-at-big-2019/545131/

General contractor can be cited for subcontractor safety violations

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A U.S. Appeals Court judge for the 5th Circuit in New Orleans has ruled that OSHA can cite general contractors — even if their employees are not affected — for subcontractor safety violations.

The ruling came after Labor Secretary Alexander Acosta requested that the 5th Circuit review an OSHA administrative court decision that said a general contractor could only be cited for safety threats to its own employees.

In 2017, a Denver Occupational Safety and Health (OSH) Commission administrative judge ruled that Hensel Phelps could not be cited by the agency for safety hazards created by one of its subcontractors on a project in Austin, Texas. However, the 5th Circuit said more recent rulings have rendered the case law on which the administrative judge based his decision “obsolete” and said that Hensel Phelps could be held responsible for safety on the multi-employer site as a “controlling employer.”

According to court documents, Hensel Phelps hired subcontractor Haynes-Eaglin-Waters (HEW) for a library construction project, and HEW, in turn, hired CVI Development as a sub-subcontractor to perform demolition, excavation and other work. Hensel Phelps and HEW project staff allegedly directed CVI to work in an unsafe excavation area. An OSHA inspector cited both Hensel Phelps and CVI for safety violations. The OSH Commission will now review the matter again, taking the 5th Circuit’s decision into consideration.

Keep reading this article at: https://www.constructiondive.com/news/court-general-contractor-can-be-cited-for-subcontractor-violations/544678/

 

Miller Act applies even if contract does not contain a bonding requirement

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United States Court of Appeals for the Federal Circuit recently held, in K-Con, Inc. v. Secretary of Army, that the bonding requirements under the Miller Act apply to federal government construction contracts, even when the bonding provisions were not part of the contract.

The Miller Act, as implemented at FAR 28.102-1, requires that before any contract of more than $150,000 is awarded for the construction, alteration, or repair of any public building or public work of the Federal Government, a person must furnish to the Government, performance and payment bonds, which become binding when the contract is awarded.  

The Appeals Court cited a doctrine first articulated in G. L. Christian & Assocs. v. United States, 312 F.2d 418 (popularly known as the Christian Doctrine) in arriving at this decision.

Under the Christian Doctrine, a court may insert a clause into a government contract by operation of law if:

  1. that clause is mandatory under applicable federal administrative regulations; and
  2. it expresses a significant or deeply ingrained strand of public procurement policy.

The court found that the Miller Act bonding requirements are mandatory, because FAR Sections 28.102-1 and 28.102-3 require the bonds and direct the insertion of the clauses into federal government construction contracts.  The court further found that Miller Act bonding requirements are “deeply ingrained” in public procurement policy.  The Miller Act bonding requirements were thus held to be incorporated into federal government construction contracts by operation of law, at the time the contracts were awarded, under the Christian Doctrine.

Keep reading this article at: https://www.jdsupra.com/legalnews/the-miller-act-applies-even-if-contract-34807

Contractors charging more for construction as prices rise

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The prices contractors say they’ll charge for nonresidential construction has made the sharpest increase since 2009, when the Bureau of Labor Statistics began recording them.

In October, prices jumped 2 percent from the previous month and 5 percent from the previous year, marking both the largest monthly and yearly increase on record.

An analysis of federal data by the Associated General Contractors of America suggests that costs have increased even more quickly, rising 6.6 percent year over year.

Keep reading this article at: https://www.lmtonline.com/business/real-estate/article/Contractors-charging-more-for-construction-as-13384074.php

Women are the solution to the construction industry’s labor shortage

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Megan Ross is an assistant superintendent for a large Maryland-based general contractor.  Ross, a former architecture major, had realized she’d rather build structures than design them, and is now on construction sites every day, coordinating subcontractors and monitoring the progress of jobs.

At her first position out of college, she earned a salary of over $50,000; two years later she says, “I have friends in architecture who are making half of that.”  The work is a joy, she says. “It’s one of the best careers you can have.”

Ross is part of an overlooked group that, with some assistance, could easily solve the construction industry’s labor shortage: women. Currently, women make up less than 3 percent of the construction workforce, which includes the building trades—hands-on jobs like carpentry, bricklaying, and electrical work—as well as management. If twice as many women worked in the field, the industry’s labor shortage would, according to data available from the U.S. Department of Labor, practically be wiped out.

And finding a solution to the ongoing worker shortage is crucial.

Keep reading this article at: https://www.curbed.com/2018/11/5/18065266/construction-industry-labor-shortage-women

Specialty contractors market ‘hot’

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Subcontractors on Engineering News-Record’s 2018 Top 600 Specialty Contractors list generated a total $124 billion of revenue in 2017, up 10% from 2016 and marking the seventh year in a row that earnings for this group increased.  ENR said the “hot” market subcontractors are enjoying right now should last at least another 12 to 18 months.

Mechanical, electrical and utility contractors dominated the first 10 spots on ENR’s list. Some firms are growing through acquisitions, but as the list of investors grows, so does the dollar amounts of the deals.

Although many specialty contractors are enjoying not having to beat the bushes in search of work, they still face challenges. One is the risk of taking on too much work, leaving those that overextend themselves vulnerable to cash flow, management and staffing shortfalls.  General contractors also have become competitors in some markets, choosing to control work quality and production schedules by self-performing jobs they previously subcontracted.  Meanwhile, the demand for specialty contractors has brought firms into the industry that have little or no expertise in the work they are bidding for.

Keep reading this article at: https://www.constructiondive.com/news/specialty-contractors-market-hot-says-enr/540698/

Billions of dollars in construction funding in FY 2019 funding bills

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On Sept. 13, Congress passed a Fiscal Year (FY) 2019 appropriations bill — which the president is expected to sign into law —t hat will provide significant amounts of funding for military construction projects through the U.S. Army Corps of Engineers (USACE) and Naval Facilities Engineering Command (NAVFAC); hospital, medical clinic and cemetery projects through the Department of Veteran Affairs (VA); and harbor maintenance, lock, dam, levee and environmental restoration projects through the USACE Civil Works Program.

The bill provides a total of $10.3 billion for military construction projects. This is an increase of $241 million, or 2.4 percent, above the enacted FY 2018 level. The bill appropriates $1.6 billion to fund construction, operation, and maintenance of military family housing for fiscal year 2019. This is $173 million above the fiscal year 2018 level and the same as the president’s FY 2019 budget request.

Major and minor construction within the VA is funded at $1.8 billion. In addition, $2 billion is provided for infrastructure repair, with the funding allocated to major and minor construction and non-recurring maintenance. Within the infrastructure total funding, $750 million is targeted to seismic corrections at VA facilities nationwide.

Keep reading this article at: http://advocacy.agc.org/billions-of-dollars-in-construction-funding-in-fy-2019-funding-bills/

OSHA cites 5 contractors in bridge collapse, proposes $87K in fines

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Main span of FIU pedestrian bridge being moved on March 10, 2018, prior to placement on the south pier and north pylon pier.  Labels added by the NTSB.

The Occupational Safety and Health Administration (OSHA) has cited five contractors who had been working on the Florida International University (FIU) pedestrian bridge that collapsed March 15, killing five motorists and one worker and injuring five others. The agency has also proposed fines totaling $86,658 for the group of companies.

  • OSHA issued Figg Bridge Engineers and engineering and inspection firm Network Engineering Services one serious violation each and proposed that each firm be fined $12,934 for exposing employees to physical danger by not removing them from the bridge area when cracks were observed.
  • The agency proposed fines of $25,868 for both post-tensioning specialty contractor Structural Technologies and general contractor Munilla Construction Management and cited both companies with two serious violations each for failing to provide adequate personal fall arrest systems.
  • Finally, OSHA issued concrete formwork contractor The Structural Group of South Florida one serious violation and a proposed fine of $9,054 for also failing to provide an adequate personal fall arrest system. The worker who died, Navaro Brown, worked for Structural Technologies.

“Collectively,” said Kurt A. Petermeyer, OSHA regional administrator, “these employers failed to take appropriate action and provide the necessary protections to their employees while they were working on the bridge on the day it collapsed.” All five companies have 15 days from the receipt of the citations and notice of proposed penalties to protest, request an informal hearing or comply.

Keep reading this article at: https://www.constructiondive.com/news/osha-cites-5-contractors-in-fiu-bridge-collapse-proposes-fines-totaling-8/532921/

See OSHA’s Sept. 18, 2018 press release here: https://www.osha.gov/news/newsreleases/region4/09182018

See earlier article on NTSB reports here: https://gtpac.org/2018/08/23/new-ntsb-report-on-fiu-bridge-collapse-stops-shy-of-naming-a-culprit/

 

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