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Contracts Archives

Eliminating Inconsistencies in California Construction Contracts

One of the biggest challenges for a general contractor on any major construction project is eliminating the inconsistencies that can arise in the numerous contracts that are needed for performance of the work. It is critical that these issues are identified and resolved prior to contract formation, as conflict in the contract documents is often what drives construction litigation.

Bulletin: California Public Works Contractors and Subcontractors Must Register!

Summary: Public works contractors and subcontractors take note- a new law requires you to register with the California Department of Industrial Relations as of July 1, 2014, even if your current public works project is already underway.  Failure to register disqualifies you from the bidding and contracting process, can cause an outright bid rejection and/or contract cancellation and can void or cancel an existing contract.  

Contractors, Architects and Owners Beware: Beacon Residential creates a duty of care by architects to homeowners associations

On July 3rd in Beacon Residential Community Assn v. Skidmore, Owings & Merrill LLP (Case No. S208173) the California Supreme Court confirmed that construction design professionals owe a duty of care to third party property purchasers who did not hire or contract with the professionals. This landmark decision is a game-changer for owners, architects and contractors alike, as liability for design and defect issues now directly impacts architects and may lead to added construction costs.

Alleged Ambiguities Not Enough to Defeat Arbitration Provision in California Construction Contract

The recent decision in HM DG, Inc. v. Amini, 219 Cal. App.4th 1100 (2d Dist. 2013) reinforces the difficulties California contractors face in trying to avoid arbitration provisions in construction contracts.

California Legislature Eliminates Contractor Type 1 Indemnity

The California Legislature recently approved California Senate Bill 474, which provides that in private commercial or public works construction contracts, any indemnity obligations arising out of active negligence or willful misconduct of the indemnified party are void and unenforceable. These indemnity obligations were already prohibited in residential construction contracts (except for homeowners improving their single family dwelling).

Bi-partisan California State Senate Bill to Require Prevailing Wage

Senate Bill 7 seeks to close the loophole which has allowed California's 121 charter cities to remain exempt from California's prevailing wage regulations. The bill, largely viewed as a win for local contractors and the local labor force, has found opposition with municipalities' political representatives, who view the Bill as a further increase of the state's hold over the local government.

All state and local government agencies in California, with the exception of California's 121 charter cities, require contractors to pay prevailing wage, an hourly pay-and-benefits benchmark for workers, on taxpayer-funded projects. While most of the 121 charter cities also pay prevailing wage, some continue to use public funds to contract for projects without such a wage requirement.

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