May 2022 The opinion in Kim v. TWA Construction, Inc. (2022 Cal. App. LEXIS 412) issued by the Court of Appeal of California Sixth Appellate District, on May 13, 2022, makes it clear that a properly licensed general contractor cannot bring an action for compensation from an owner for work performed by an unlicensed subcontractor. California licensing law has long made explicit that an unlicensed contractor cannot bring or maintain any action to collect or recover compensation for work that contractor performed unless they were duly licensed at all times during the performance of that work. This new ruling extends […]

  California local public agencies and their contractors should take note of a recent appellate decision pertaining to late progress payments on public works projects. In Clark Bros., Inc. v. North Edwards Water Dist., 2022 Cal. App. LEXIS 331, filed on April 22, 2022, the Court of Appeal for the Fourth Appellate District held that a local agency’s late progress payments to a general contractor did not constitute breach of contract under the prompt payment penalty statute, Public Contract Code § 20104.50. Notwithstanding this holding, the contractor recovered damages, interest, fees, and costs in excess of its contract amount. In […]

March 2022 The pandemic certainly did not slow down California’s Legislature and appellate courts. The following five appellate decisions significantly impact businesses that use standard form agreements, employ mechanics lien and related remedies to ensure payment for labor or materials on construction projects, rely on website/online terms and conditions, and agree to resolve debts with written agreements. INCONSPICUOUS ARBITRATION (AND POSSIBLY OTHER CONTRACT) CLAUSES WILL NOT BE ENFORCED The Domestic Linen Supply Co., Inc. v. L J T Flowers, Inc., 58 Cal. App. 5th 180 (2020) case should encourage all distributors and manufacturers that utilize standard form credit, sales, or rental agreements […]

On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, also referred to as House Resolution (“H.R.”) 4445 (the “Act”). The overall purpose of the Act is to prohibit mandatory enforcement of arbitration agreements sexual assault and sexual harassment lawsuits. Instead, the Act gives the employee the option of proceeding with arbitration, if an arbitration agreement exists, or proceeding with claims in court, by amending the Federal Arbitration Act. The impact of the Act is that cases based on sexual assault or sexual harassment occurring or on or after March […]

California courts continue to demonstrate little patience for employment arbitration agreements that they deem are one-sided in the employer’s favor. In Ramirez v. Charter Communications, Inc., the appellate court affirmed a lower-court’s ruling holding that an employment arbitration agreement was unconscionable and, therefore, unenforceable.  The Ramirez court started its review with the well-established principle that unconscionability requires demonstrating both procedural and substantive unconscionability. Procedural unconscionability focuses on “ ‘surprise’ due to unequal bargaining power.” Substantive unconscionability focuses on “ ‘overly harsh’ or ‘one-sided’ results.”  While both procedural and substantive unconscionability need to exist, the elements do not need to exist in the same degree: “[t]he more […]

February 2022   Employers looking to retain or recruit talent realize that employees are not simply looking for a position with the highest salary. Employees may, for example, prioritize quality fringe benefits. These benefits may include traditional benefits, such as health and dental insurance, but also education allowances, surrogacy and adoption assistance, or unlimited vacation time. The COVID-19 pandemic has also shown that many employees are prioritizing office flexibility, including the ability to work remotely, so they can spend more time with their family and less time at the office or commuting. An idea that has received media attention lately […]

February 2022 A recent ruling by the California Supreme Court will likely make it easier for employees to bring and maintain Labor Code § 1102.5 whistleblower claims against employers.  In Lawson v. PPG Architectural Finishes, Inc., the federal Ninth Circuit asked the California Supreme Court to clarify the framework used determining a section 1102.5 claim.  Section 1102.5 generally protects employees from retaliation for reporting a suspected violation of a local, state, or federal law or for refusing to participate in a suspected violation of local, state, or federal law.  When Section 1102.5 was enacted in 1984, the statute did not […]

January 2022   Gibbs Giden is pleased to announce that Maxwell A. Harrington has joined the Firm’s Los Angeles office as a new Associate Attorney. Max is a 2016 graduate of UCLA and, most recently, a 2021 graduate of Pepperdine University Caruso School of Law. Prior to law school, Max co-founded a startup company in the United Kingdom and directed its operations through its initial rounds of funding and merger, and brings his real-world experience to his business, commercial, and construction law practice.         For more information about Max, visit https://www.gibbsgiden.com/attorneys/maxwell-a-harrington/   Max can also be reached […]