Thoughts on construction law from Christopher G. Hill, Virginia construction lawyer, LEED AP, mediator, and member of the Virginia Legal Elite in Construction Law

Interesting Perspectives on Construction Law from Friends

Contracts
Contracts (Photo credit: NobMouse)

As I have been in a bit of the throes of writers block here at Musings (hey, it happens), I did what I always do and check the great sources of information in my blog roll and Feedly feeds for any fodder to discuss.

In doing so, I ran across two interesting posts, one from my pal Matt Bouchard (@mattbouchardesq) down in Raleigh, NC entitled “Mediator/Arbitrator Hybrids: The Next Big Thing in Construction Dispute Resolution.” In this post (which I will not go into much detail about here) Matt discusses a contractual procedure where one person acts as a mediator and arbitrator in a procedure summarized (after a full outline of the contractual provisions) by Matt as follows:

There you have it: soup-to-nuts construction dispute resolution within 65 days, no muss, no fuss. The procedure features one neutral, serving as both the mediator and the arbitrator, with virtually no time at all transpiring between the end of the mediation and final resolution of the arbitration.

The U. S. District Court for the Eastern District of North Carolina in U.S. ex rel. TGK Enterprises, Inc. v. Clayco, Inc.

Given my general penchant to recommend ADR, and in particular mediation, for the resolution of disputes, this case caught my eye. While the procedure has some flaws and needs to be carefully considered before entering into such a “streamlined” process, it does avoid some of the pitfalls of mandatory arbitration and shortens the process. In my opinion (and of course, I’d love to hear yours) this process could be a good one in the correct situation.

The second post, from my good friend and occasional co-presenter Scott Wolfe (@scottwolfejr) struck me as different but no less important a reminder. Scott’s post is entitled “Mechanics Lien Rights Cannot Be Waived – But Can They Be Reduced To Obscurity?” As the title suggests, the post discusses the fact that in most states contractual waiver of mechanic’s lien rights is prohibited as contrary to public policy. Scott then goes on to discuss the various contractual provisions routinely included in construction contracts and their potential impact on lien rights, even in states where waiver of those lien rights is prohibited.

An example of the type of question explored in Scott’s post is the following:

If a state’s public policy requires lien rights remain in tact to protect subcontractors and suppliers’ right to payment, and it cannot be waived, isn’t a “pay if paid” provision creating a scenario to defeat the state’s public policy of protecting subcontractors and suppliers?

He then asks similar questions regarding everything from arbitration clauses to restrictive claim notice clauses in those states where public policy precludes waiver of lien rights.

Of course, in the Commonwealth of Virginia where I practice law the contract is king and public policy generally has no bearing on the “deal” laid out in a contract. In short, a subcontractor or supplier can waive its mechanic’s lien rights through contract. In short, if you come into Virginia to perform construction work, make sure to carefully review the contract with a local Virginia construction lawyer to assure that contract provisions that may be unenforceable in your home state and that waive important rights are not present in your construction contract.

These are just two of the many great posts to be found at those blogs and sites found on the links page here at Musings. I recommend you read these two and then explore the other blogs I have linked to. They contain great thoughts and are a great way to get past writers block.

As always, I welcome your comments below. Please subscribe to keep up with this and other Construction Law Musings.

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