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Changes are made to the scope of work on construction projects every day. In some cases, the contract party being asked to accept these changes is reluctant to do so, viewing the changes to be so substantial as to result in a scope of work radically and materially different than what it originally agreed to perform. Faced with these circumstances, the decision to refuse to perform the extra work and walk away from the project can be a tempting one.

The “cardinal change doctrine” is a tool available to address these situations. The doctrine provides that, when changes are made to a contract which are so disproportionate to the original scope of a contractor’s work that they constitute an abandonment of the original agreement by the other party, the contractor is relieved of further performance obligations.
Continue Reading Connecticut Appellate Court Recognizes Cardinal Change Doctrine for the First Time

As we began to describe on March 18, the economic impacts of the ongoing coronavirus/COVID-19 pandemic on the construction industry are becoming more severe as the pandemic continues and spreads. Substantial uncertainty remains, however – as of the date of this post, the “peak” of the pandemic in New York, Connecticut, and Massachusetts is expected to occur (depending on which reports you read) in mid-April, late-April or May, respectively. It appears increasingly likely that proactive, protective measures in these states, along with their restrictive effects on the economy and construction activity, will continue through the end of April and into May.
Continue Reading Ongoing Impacts of the Coronavirus Pandemic on Construction Projects in Major Markets

Building upon the success of last year’s event, on May 31, 2018 Robinson+Cole’s Construction Group led the Second Construction Industry Roundtable Discussion at its Hartford office. With a variety of representatives from major Connecticut construction industry organizations and other industry stakeholders in attendance, the participants discussed issues affecting the construction industry in 2018 and beyond.

With 2018 being an election year in Connecticut, the discussion began with a question posed to all attendees about anticipated outcomes and impact of the gubernatorial election in November. All agreed that, while the result of the election remains difficult to predict, the next governor will inevitably be required to address continued challenges with the state’s economy as a whole and the burden of state government personnel costs specifically. Several expressed concern as to the State’s perceived unfavorable climate for doing business. As an industry particularly susceptible to influence by the current economic climate, it was agreed that good news for the economy and business growth would certainly be good news for the construction sector.
Continue Reading Summary of the Second Construction Industry Roundtable Discussion

Our readers may recall that Public Act No. 15-28 was signed by the Governor back in 2015, subjecting the State of Connecticut and its political subdivisions to a statute of limitations for asserting actions and claims arising out of “construction-related work.” The law became effective as of October 1, 2017. “Construction-related work” is defined in the Act to include the design, construction, construction management, planning, construction administration, surveying, supervision, inspection or observation of construction of improvements to real property. Notably, it applies not only to the State, but also its subdivisions such as cities, towns, and other entities like school districts.

The limitations period set forth in the Act is 10 years from the date of substantial completion of a given improvement. The 10 year limitations period applies going forward to improvements to real property substantially completed on or after October 1, 2017. For improvements substantially completed before October 1, the limitations period runs to October 1, 2027. Prior to the Act, the State and its political subdivisions were generally not subject to any statutes of limitations for such claims due to the legal doctrine of nullum tempus occurrit regi, which provides that a state is not subject to statutes of limitations unless it specifically consents to be. Literally translated, it means that “no time runs against the king.”
Continue Reading Tic Toc Tic Toc: The Clock Is Running on Construction and Design Claims by the State of Connecticut Beginning October 1, 2017

On August 30, 2017 Robinson+Cole’s Construction Practice Group held its annual Retreat at the newly completed Dunkin’ Donuts Park in Hartford. The Retreat featured an Industry Leaders Roundtable discussion session with representatives from many  of the major Connecticut construction industry organizations. The discussion was moderated by Construction Group Chair Greg Faulkner and led to a lively discussion on various issues affecting the construction industry. Here are some of the highlights:

The first topic of discussion focused on what attendees viewed as the most significant challenges facing design and construction service providers in the immediate future. All in attendance agreed that the shortage of young professionals and tradespeople embarking on careers in the construction and design industries was an issue of serious concern. It was pointed out that Connecticut is unique among many of our neighboring states in that it provides options to young people considering a career in the construction industry through trade schools, which feature an academic curriculum in addition to skills education, and the fact that public high schools are increasingly adding trade-skills-based education back into their regular curricula. This was viewed as good news by all. On a related note, those in attendance reported positively on the increased presence of women in the construction and design industries, particularly the trend of more women entering the industries as young professionals and advancing in seniority to managerial roles.
Continue Reading Robinson+Cole Hosts Industry Leaders Roundtable Discussion

In a recent decision by the Third Circuit Court of Appeals, the Court held that a mechanic’s lien filed by an unpaid supplier against a construction project, after the contractor through whom the materials were furnished filed for bankruptcy, was voidable. In re Linear Electric Co., No. 16-1477 (3rd Cir. March 30, 2017).  Specifically, the Court held that once the contractor filed for bankruptcy, the automatic stay barred the filing of a mechanic’s lien. While the supplier argued that the lien only encumbered property of the owner of the construction project, rather than property of the contract, the Court rejected that argument. The Court held that because the lien permitted recovery of money owed by the owner to the contractor, the lien acted to seize a portion of the contractor’s accounts receivable, which was now an asset of the bankruptcy estate.

Interestingly, the Court noted that the result might have been different if another state’s law governed. The Court acknowledged that in another case, In re Yobe Electric, Inc., 728 F.2d 207 (3rd Cir. 1984), the filing of a mechanic’s lien by a subcontractor did not violate the automatic stay provision because, under Pennsylvania law, the date of filing the mechanic’s lien related back to “the date of visible commencement upon the ground of the work of erecting or constructing the improvement.” In In re Linear, the Court applied New Jersey law, which contained no such relate back provision and, therefore, the mechanic’s lien was effective only as of the date of filing. 
Continue Reading The Enforceability of Mechanic’s Liens in Bankruptcy is Dependent on State Law