Everything You Need To Know About Public Construction
November 11, 2010
Becker & Poliakoff announces upcoming public contracting seminars to train you about the unknown nuances of public construction....
Lender Beware: Part III
November 8, 2010
When a lender takes title to a foreclosed home or condominium and completes construction, that lender is under a duty to act with reasonable care in completing construction....
Resolving Building Code Interpretation Disputes With a Building Inspector
October 29, 2010
Building code interpretations are available from the Florida Building Commission in the form of declaratory statements and binding interpretations....
Free Construction Work, Come and Get It
October 28, 2010
If you want work done for free, hire an unlicensed contractor. The 3rd District Court of Appeals rendered a not-final opinion October 27th articulating a very clear message: unlicensed contractors need not be paid. In Master Tech Satellite, Inc., etc. v. Mastec North America, Inc., etc. (No. 3D08-2509 October 27, 2010), Master Tech was hired by Mastec North America to install residential digital satellite systems for Mastec's customers. Mastec North America apparently did not pay for the work. Master Tech then sued to recover on the contract in an amount in excess of $300,000.00. During the course of discovery, it was brought to light that the work performed by Master Tech involved at least some electrical work and required a license. It was also discovered that, in fact, Master Tech did not hold such a license. The trial court granted summary judgment for defendant based on Sec.489.532, Florida...
Amendment 4: Disaster Awaits
October 19, 2010
One of the most important decisions for voters in the State of Florida is whether or not to vote in favor of Amendment 4. Regardless of party affiliation, all voters should vote "No" on this amendment....
Lender Beware, Part III
October 14, 2010
A lender who becomes the seller of new homes acquired from his defaulting builder or developer may be exposed to liability for construction defects whether or not the lender actively participated in any aspect of the original construction....
Performance Bonds are Governed by their Terms
October 5, 2010
Performance bonds are actually contracts and, like all contracts, can be modified or drafted to contain whatever provisions the parties agree to. Great care should be taken to ensure you fully understand the rights and ramifications the bond language creates....
The Scope of Attorneys’ Fees for Prevailing Parties Must be Defined
October 1, 2010
A recent case shows the importance of defining the scope of a prevailing party attorneys' fee provision in contracts....
Lender Liability to Contractors Extended by Court
September 21, 2010
A recent Florida appellate court decision extended a lender’s liability to contractors for failure to fully fund a construction loan on a project. §713.3471 of the Florida Statutes makes construction lenders liable to contractors and lienors who served a notice to owner if the lender ceases funding a construction loan without first notifying the contractor and lienors. In that situation, the lender could be liable for the actual construction costs incurred plus 15% for overhead and profit from the date on which the notice should have been provided until the date it actually is provided, if at all.
In an opinion not yet reported, Whitehead v. Tyndall Federal Credit Union, the court liberally interpreted this statute to make a lender liable to the original contractor when the lender failed to pay that contractor, but instead paid a replacement contractor. The lender denied liability, saying it fully funded the construction loan as required by the statute, even though the funding went to a subsequent contractor. The court held that, since the construction loan funds didn’t all go to the original contractor, the lender was required to provide statutory notice to the contractor that loan proceeds would no longer be funded to that contractor, even though they would later be paid to the subsequent contractor. The court reversed summary judgment in the lender’s favor, paving the way to the lender’s potential liability to the contractor for actual costs plus 15% overhead and profit.
Therefore, in this environment where non-payment of contractors has proliferated, consideration should be given to whether claims against the construction lender are available
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Lender Beware: Part II — Lender as Joint Venturer / Partner
September 17, 2010
Lenders beware: there are some circumstances in which a lender may be directly liable to third parties for construction defects as a principal or alter ego of the developer....