Sophisticated contractors and material suppliers (and their counsel) understand the benefits of serving a stop payment notice upon an owner, lender, or other construction fund holder on both private and public works of improvement.  In essence, the stop payment notice places a lien on the undisbursed construction funds and is often considered a complementary remedy to a mechanics lien on private projects, and to a payment bond on public works of improvement.   It is generally understood that stop payment notices for public projects and owner-financed private projects are straightforward.  Often times, claimants simply complete a one-page stop payment notice […]

In Carmel Development Co., Inc. v. Anderson, 48 Cal.App.5th 492 (2020), Carmel Development Company, Inc. (“Carmel”) agreed under an oral contract with Monterra LLC to provided design and construction work to create a luxury subdivision called Monterra over 10+ years.  Monterra LLC was unable to pay so Carmel recorded two liens to collect the unpaid obligations.  The water lien burdened only the 85 unsold lots, but the work benefited all 170 lots.  The site improvement lien burdened only lots in Phases 7 and 9, because they were the only lots benefited by that work.             Carmel sued several of Monterra […]

Contractors, suppliers, and others providing labor, materials, and equipment to California private works of improvement must navigate a minefield of conditions precedent to ensure they have a valid lien claim against the property they improved. From the timely and proper service of a preliminary notice to the timely service and recording of the lien itself, claimants must be vigilant to preserve their claim. Make one mistake and the lien claim may be declared invalid. Rarely does a single case address even a portion of the multitude of potential issues facing a subcontractor or supplier seeking to enforce its lien claim. However, in Palomar Grading & […]

A new and significant California Court of Appeal decision that will have substantial financial impacts on direct contractors, their sureties, and subcontractors was published on April 17, 2020, called Crosno Construction, Inc. v. Travelers Casualty and Surety Company of America.  This case, which focuses on “pay-when-paid” language in a public works subcontract, substantially impacts the timing of a payment bond surety’s obligation to the subcontractor, and has the potential to be applied to the timing for payment by a general (direct) contractor to a subcontractor.  In essence, this case holds that a “pay-when-paid” provision in a subcontract is void and unenforceable […]

The State of California has released guidance exempting construction workers “who support the construction, operation, inspection, and maintenance of construction sites and construction projects (including housing construction)” from Governor Newsom’s March 19, 2020 shelter in place order.  This broad exemption includes commercial construction projects.  However, many counties and certain cities have issued more restrictive orders pursuant to authority vested in the California Health and Safety Code, which grants local health officers the discretion to take preventive measures necessary to protect and preserve public health in their respective jurisdictions.  Generally speaking, these orders have imposed a moratorium on all construction projects […]

By now every construction professional has been inundated with articles regarding the impacts of COVID-19 on the construction industry. The sheer volume of information is overwhelming and changes by the hour. This article is intended to summarize key issues affecting construction professionals and serve as a general road map for navigating the crisis.   1.    Determine Project Status The first consideration is whether the construction projects at issue are allowed to proceed given “shelter in place” and related orders. Generally speaking, Governor Newsom has deemed construction to be essential and, therefore, exempt from California’s “Safer at Home” order. There is some debate as to […]

  You can find the full transcript and slides here.  For more information contact: Christopher E. Ng Gibbs Giden Locher Turner Senet & Wittbrodt LLP 1880 Century Park East, 12th Floor Los Angeles, California 90067 Phone: (310) 734-3367 email: cng@gibbsgiden.com The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel. For specific questions about any of the […]

You can find the full transcript and slides here. For more information contact: Christopher E. Ng Gibbs Giden Locher Turner Senet & Wittbrodt LLP 1880 Century Park East, 12th Floor Los Angeles, California 90067 Phone: (310) 734-3367 email: cng@gibbsgiden.com The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel. For specific questions about any of the content […]

Levelset collected advice from leading construction law attorneys. Gibbs Giden partner Christopher Ng suggests that “parties should get ahead of a very tangled legal situation NOW.”  Read 8 Construction Lawyers Give Scary Advice for Contractors to Survive Coronavirus here. This content does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel. This may not be reproduced or used in whole or in part without the written consent of Levelset and the firm. For more information contact: Christopher E. Ng Phone: (310) 552-3400 email: cng@gibbsgiden.com  For specific questions about any of the […]

Public Contract Code section 5110 provides a very narrow exception to the general rule that a contractor cannot recover costs of work performed if a construction contract with a public entity is invalidated. More specifically, subsection (a) provides that if a public contract “is later determined to be invalid due to a defect or defects in the competitive bidding process caused solely by the public entity,” the contractor may recover its reasonable costs, specifically excluding profit, of the labor, equipment, materials, and services furnished by the contractor prior to the determination that the contract is invalid. In a recent Court […]