Volume: 22, Issue: 9 - 05/15/2024


Design professionals can have their licenses suspended or revoked for conduct unrelated to the practice of their profession. As with any other licensed professional, certain types of egregious behavior may indicate an individual is a danger to the public when practicing that profession.


A licensed architect designed two houses. There were no complaints about the designs or the architect’s practice of his profession. However, once the designs were complete, the architect contracted to serve as general contractor for the construction of the homes. It was alleged he diverted and misdirected contract payments during the construction process, which led to criminal indictments. His architect’s license was summarily suspended pending resolution of the criminal charges.


The second case in this issue involves the timing of the government’s baseline survey of elevations for purposes of measuring the quantity of unit-priced compacted fill. Did performance of the survey prior to, rather than after, clearing and grubbing of the site result in an understatement of the quantity of placed fill?


The third case addresses the difficult issue of bid security for an electronically submitted bid. Did the concurrent submission of an electronic image of a cashier’s check suffice? Or was the low bid rendered unsecured and nonresponsive?


The license of an architect, who also served as the general contractor on the projects he designed, was summarily suspended after he was accused of misapplying payments under the construction contracts.


In a unit-priced contract for the placement of compacted fill, performance of the baseline quantity survey prior to clearing and grubbing of the site was consistent with the terms of the contract and not inconsistent with customary construction practice.


A Louisiana appeals court has ruled an electronic depiction of a certified check, followed by prompt physical delivery after bid opening, was sufficient security for an electronically submitted low bid.

Volume: 22, Issue: 8 - 05/01/2024


Contract retainage is intended to protect a project owner against deficient work, incomplete work and other forms of contract nonperformance. The 5–10% retained from each progress payment can add up to a significant sum over the course of the project. When project completion nears, the right to that retainage may become the source of disagreement.


The parties to a site improvement contract contested the contractor’s right to interest on unreleased retainage. The AIA contract form clearly called for interest on late progress payments, but was silent regarding interest on retained funds. A Pennsylvania court sidestepped a ruling on this issue, however, because the contractor had not provided the mechanic’s lien waivers that were a precondition to release of the retainage.


The other case in this issue involves the change order procedure in a fixed-price home construction contract. Neither party had followed the contractual procedure over the course of the project. Could the homeowners still challenge the builder’s pricing of upgraded or extra work?


AIA contract documents were silent as to whether interest on late progress payments also applied to the final payment of contract retainage. The contractor, however, had never provided the lien waivers required for final payment. Consequently, no interest could accrue to the unreleased retainage.


A fixed-price construction contract for a new home required advance written change orders, priced and signed, for changed work. The homeowners, through a course of conduct, waived the right to enforce that clause; however, they could still challenge the pricing of upgraded or extra work.

Volume: 22, Issue: 7 - 04/16/2024


Most construction contracts include an “order of precedence” clause. The various contract documents are listed and the clause states that in the event of a conflict or discrepancy within the documents, the documents shall take precedence in the order listed. It is easy to view these clauses as dry boilerplate. In actual application, however, they can be significant.


The contract plans for a street improvement project depicted sidewalks to be constructed, but did not indicate pedestrian walkways or crossovers. Standard highway specifications, incorporated by reference into the contract, called for such pedestrian protections during construction. When a pedestrian was struck and killed, the order of precedence clause became crucial.


Another case also involved contract interpretation and safety responsibilities. An injured worker argued that the project architect, tasked with weekly monitoring of the construction site for contract compliance, should have detected and warned of an unsafe practice. Fortunately for the architect, the professional services agreement with the project owner spelled out what the architect was, and was not, responsible for monitoring.


The third case in this issue involves a contractor’s recovery under a termination for the convenience of the government clause. The federal government argued that the contractor’s breach of contract prior to termination barred any recovery of performance costs incurred before the effective date of termination. The contractor responded that the government should have terminated the contract for default if it wanted to hold the contractor responsible.


Project plans did not depict construction phase pedestrian safety measures, such as crossovers or walkways, even though standard specifications incorporated by reference into the contract called for such measures. This posed a conflict within the contract documents, which had to be resolved in accordance with the Order of Precedence clause.


An architect’s professional services agreement with a project owner defined the architect’s on-site responsibilities during construction. The agreement expressly disclaimed responsibility for safety practices. No extra-contractual duty was created simply by a design professional’s presence at a job site.

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