payment bond claim – Construction Law Musings- Richmond, VA

Reminder: Second Tier Subcontractors Have Miller Act Claim

Originally posted 2013-02-11 09:00:06.

English: Alexandria, Virginia U.S. Custom House and Post Office (1900)

English: Alexandria, Virginia U.S. Custom Hous... — English: Alexandria, Virginia U.S. Custom House and Post Office (1900)

Here at Construction Law Musings, we often discuss the Federal Miller Act and its Virginia equivalent (the “Little Miller Act“). These two statutes provide subcontractors on government projects (on which no mechanic’s lien can attach) the protection of payment and performance bonds.

One question that often arises in this context is which subs can claim against the payment bond. Recently, the Eastern District of Virginia District Court affirmed that a second tier subcontractor has the right to claim against a payment bond under the Federal Miller Act. In U.S. ex rel IGW Electric LLC v. Scarborough, the Virginia federal court considered the claim of an electrical “sub-subcontractor” which held a contract with the subcontractor to build cottages in Norfolk, Virginia for the U. S. Navy.

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Maybe Supervising Qualifies as Labor After All

Remember back in 2021 when I “mused” about Dickson v. Fidelity and Deposit Company of Maryland et al.? Remember how the Eastern District of Virginia held that mere supervision does not qualify as “labor” under the federal Miller Act? Well, the 4th Circuit recently weighed in on the appeal of that case and had some interesting things to say about the definition of labor.

As a quick reminder, Plaintiff worked as a project manager on a project to repair and upgrade certain stairs at the Pentagon. Plaintiff subcontracted with prime contractor Forney Enterprises Inc. on this project. On Dec. 20, 2018, the prime contract was terminated. Plaintiff filed the Miller Act suit on Feb. 5, 2020. Dickson alleged that Fidelity and Deposit Company of Maryland, or F&D, must pay him, pursuant to the Miller Act, the amount he is owed for the labor he performed on the project. Now before the district court were cross-motions for summary judgment. In evaluating Plaintiff’s claims, the district court examined the defendant’s claims that (1) Dickson’s work did not qualify as “Labor” under the Miller Act, and (2) that the suit was not timely filed. The Eastern District of Virginia court agreed with both arguments.

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Discussions of Changes in Virginia Mechanic’s Lien Law at ZLien

Originally posted 2015-06-16 13:00:56.

Once again I get to thank Scott Wolfe (@scottwolfejr) over at Zlien for an opportunity to guest post. This time around it is on the soon to be implemented changes to the Virginia law as it relates to contractual waivers of lien and bond claim rights.

Here’s a taste of the post over at Scott’s blog:

At its most basic level these changes void the fairly standard contractual terms found in many Virginia construction contracts that provide that a subcontractor waives its mechanic’s lien rights on the project prior to any work being performed. As I stated in my earlier posts, this is a big deal and brings Virginia in line with a majority of the states in barring the enforceability of such clauses. However, and despite much lobbying by the Virginia chapter of the Associated General Contractors, the language does not extend to general contractors. The wisdom of such an omission is best left to the politicians.

For the rest of my thoughts check out the full post here.

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