Justia Construction Law Opinion SummariesArticles Posted in U.S. 1st Circuit Court of Appeals
Harrington v. Aggregate Indus., Inc.
The "Big Dig" highway project, built largely with federal funds, has transformed vehicular travel in Boston. Defendant supplied concrete and, on occasion, secretly substituted substandard material for the concrete required by contract specifications. Certain employees, including plaintiff, learned of the deception and brought a sealed qui tam action under the False Claims Act, 31 U.S.C. 3729-3733. The federal government intervened, and settled the case for several million dollars. Plaintiff received a percentage of the settlement. A few days after he signed the settlement, defendant dismissed plaintiff, allegedly for his refusal to take a drug test. Plaintiff sued, asserting pretext and retaliation. The district court granted summary judgment in favor of the employer. The First Circuit vacated and remanded, applying a burden-shifting analysis and concluding that the circumstances of the firing are open to legitimate question and that the record, viewed as a whole and in the light most favorable to plaintiff, did not warrant the entry of summary judgment. View "Harrington v. Aggregate Indus., Inc." on Justia Law
Antilles Cement Corp. v. Fortuno
Two laws were challenged under the Buy American Act, 41 U.S.C. 8301, which requires that only materials mined, produced, or manufactured in the U.S. be employed for "public use" or used in construction, alteration, or repair of "any public building or public work. A 1985 Puerto Rican law required that local construction projects financed with federal or Commonwealth funds use only construction materials manufactured in Puerto Rico, with limited exceptions relating to price, quality, and available quantity, P.R. Laws Ann. tit. 3, 927-927h (Law 109). Cement is deemed "manufactured in Puerto Rico" only if composed entirely of raw materials from Puerto Rico. P.R. Laws Ann. tit. 10, 167e (Law 132), enacted in 2001, imposes labeling requirements on cement and required that foreign-manufactured cement carry a special label warning against its use in government-financed construction projects unless one of the exceptions contained in the BAA and Law 109 applies. The district court held that the local laws were preempted. The First Circuit upheld Law 109 as a permissible action taken by Puerto Rico as a market participant, but invalidated provisions of Law 132 that discriminate against sellers of foreign cement, leaving the remainder of the law intact. View "Antilles Cement Corp. v. Fortuno" on Justia Law
Redondo Constr. Corp. v. Izquierdo
In 1999 plaintiff pled guilty to making false statements while working on a project funded by the Federal Highway Administration (18 U.S.C. 2, 1014, and 1020). The agreement prohibited plaintiff from participating in any FHWA-funded project for a year. Plaintiff challenged Puerto Rico agencies' subsequent actions. The parties negotiated settlements; plaintiff entered into an agreement allowing it to bid on FHWA projects. Puerto Rico then enacted Law 458, which prohibits award of government contracts to any party convicted of a crime constituting fraud, embezzlement, or misappropriation of public funds and requires rescission of any contract with a party convicted of a specified offense. The statute states that it does not apply retroactively. One agency cancelled plaintiff's successful bids, another withdrew its consent to the settlement. The district court rejected claims of violation of the federal Contracts Clause and breaches of contract under Puerto Rico law. The First Circuit affirmed with respect to the constitutional claim. Any breach of the settlement agreements did not violate the Contracts Clause, even if committed in an attempt to unlawfully enforce Law 458 retroactively; defendants have not impaired plaintiff's ability to obtain a remedy for a demonstrated breach. Given the stage of the litigation, the district court should have retained the breach of contract claims. View "Redondo Constr. Corp. v. Izquierdo" on Justia Law
Wright-Ryan Constr., Inc., v. AIG Commercial Ins. Co.
The claim arose from an accident at a construction site. The company was insured under its own commercial general liability policy, issued by Acadia, and as an additional insured on a subcontractor's policy, issued by AIG. Both policies contained provisions that: This insurance is excess over: (1) Any of the other insurance, whether primary, excess, contingent, or on any other basis . . . (a) That is . . . coverage for "your work"; . . .(2) Any other primary insurance available to you covering liability for damages arising out of the premises or operations for which you have been added as an additional insured by attachment of an endorsement. The company and Acadia sought declaratory judgment that AIG was obligated to defend the construction company and compensation of costs incurred by Acadia that defense. The district court granted judgment in AIG's favor. The First Circuit reversed, holding that the plain language of the policy requires that the Acadia policy be treated as excess over the AIG policy. The word "you" refers solely to the listed Named Insured in the policy Declarations or "qualifying as Named Insureds" under the policy. View "Wright-Ryan Constr., Inc., v. AIG Commercial Ins. Co." on Justia Law
Berkshire Med. Ctr., Inc. v. U.W. Marx, Inc.
The hospital engaged a contractor for renovations and expansion. Before occupancy the hospital noted problems with the flooring in operating rooms; the contractor completed some repairs. After the project was complete, new problems continued to appear and the contractor repeatedly repaired the floors. All of the problems documented by January 2005, the expiration of a one-year warranty period, were repaired. The contractor continued to perform repairs through early 2006, when the hospital conducted its own investigation and replaced the floors at a cost of $398,070, without involving the contractor. The cost was higher than the original installation because of the need for containment systems so that the facility could continue to operate. A jury awarded $331,835 in damages on the warranty plus pre-judgment interest. The First Circuit affirmed. A reasonable jury could find that the problems were due to faulty workmanship or materials for which the contractor was responsible under the warranty, that the hospital properly invoked the warranty, and that the hospital was not required to give the contractor the option of doing the job. View "Berkshire Med. Ctr., Inc. v. U.W. Marx, Inc." on Justia Law