Construction Law

Published on: September 17, 2019

New Jersey Appellate Division Issues Opinion on Apportioning Damages in Construction Law Consumer Fraud Cases

The Appellate Division of New Jersey’s Superior Court recently issued an important construction law decision examining the effect of New Jersey’s Consumer Fraud Act in cases also involving the breach of a construction contract or negligent construction.

By way of background, coverage under New Jersey’s Consumer Fraud Act was expressly extended to include contractors engaging in home improvements and home repair. The New Jersey Department of Community Affairs issued regulations requiring specific items in contracts between home improvement contractors and homeowners. Violation of these technical requirements are “per se” violations of the Consumer Fraud Act, entitling the homeowner to triple damages and reimbursement of their attorneys fees by the contractor.

Under these regulations, the specific requirements which home improvement contracts must contain include the following.

Published on: March 30, 2019

Recent New Jersey Appellate Division Decision Examines The Amended Sections Of The Construction Lien Law

by Robert Chewning, Esq.

construction-machine-3412240__340-300x202 The Appellate Division of New Jersey’s Superior Court recently reviewed the signature requirements for filing a construction lien claim prior to and after the 2011 amendments to New Jersey’s Construction Lien Law. Our construction attorneys represent contractors in construction law matters including but not limited to filing and/or defending against construction lien claims under New Jersey’s Construction Lien Law, N.J.S.A. 2A:44a-1, et seq.

The Court’s review was in Diamond Beach, LLC v. March Associates, Inc., decided in December 2018. The Court was required to review the signatory requirements “pre” and “post” Construction Lien Law amendments, and determine whether the amendments should retroactively apply to previously filed construction liens. Prior to the 2011 Construction Lien Law amendments, N.J.S.A. 2A:44A-6 required that a lien claim be signed, acknowledged, and verified by “a partner or duly authorized officer” of the partnership or organization. The 2011 Construction Lien Law amendments dropped the requirement that the lien claim be signed by a “duly authorized officer” and instead required that the lien claim comply with the N.J.S.A. 2A:44A-8 claim form which requires that a “officer/member” sign the form.

While the amendment may have lowered the filing requirements, the Court found that the 2011 changes to the signatory requirements do not retroactively apply to the lien at issue, which was filed prior to the 2011 amendments, because the amendments did not expressly state that they were retroactive. Further, the Court found that the amendments were not “curative” because there was no evidence that they were made to “cure” a previous misinterpretation of the law. Diamond Beach, LLC v. March Associates, Inc., 457 N.J. Super. 265, 277–78 (App. Div. 2018).

Published on: March 7, 2019

New Jersey’s Appellate Division Issue Decision Important to Construction Contractors

by Maurice W. McLaughlin

construction-645465__340-300x200 A recent decision in the case of Jacobs v. Mark Lindsay and Son Plumbing & Heating, Inc., by the Appellate Division of New Jersey’s Superior Court examined the interplay between two very important laws – New Jersey’s Consumer Fraud Act and the criminal “theft of services statute” in the context of a dispute between a contractor which wanted to get paid, and a homeowner who didn’t believe the contractor had earned his fee. It contains important lessons for residential construction contractors.

The Consumer Fraud Act and Theft of Services

New Jersey’s Consumer Fraud Act prohibits merchants from engaging in “unconscionable commercial practices.” The Consumer Fraud Act applies to “home improvement contractors,” and regulations issued by the Division of Community Affairs extend the Consumer Fraud Act’s protections to specific requirements for contracts for “home improvement” work, including having a signed, written contract in the first place. The New Jersey Criminal Code makes theft of services a criminal offense.

Published on: May 16, 2018

Construction Lien Law: Timing is Key

by Robert Chewning, Esq.

McLaughlin & Nardi’s New Jersey construction attorneys represent owners, contr house-construction-3370969__340-300x197 actors and building suppliers in the prosecution and defense of construction lien claims.

As discussed in McLaughlin & Nardi’s overview of construction liens, they can be powerful tools for construction contractors, subcontractors, and suppliers who are experiencing difficulties in getting paid for the work that they have performed.

However, when considering whether to proceed with filing a construction lien for either a commercial or residential project, it is important to know that the contractor (“claimant”) act promptly once it starts to experience payment issues.

Published on: November 29, 2017

Arbitration in Multi-Issue Construction Claims

by Maurice W. McLaughlin

brick-2952711__340-1-300x200 Disputes over construction projects can be costly, time-consuming, complex and unpredictable endeavors. Arbitration is a mechanism often used to avoid these pitfalls by many in New Jersey construction law. Attorneys from our firm have significant experience in litigating and arbitrating construction disputes. One of the most contentious areas is whether a dispute is subject to arbitration or whether it may be litigated in court. Even more complex is trying to figure out which parts, if any, are covered by an arbitration in multi-issue disputes. New Jersey’s courts recently faced just this problem and issued an important precedential decision.

Construction Arbitration

Arbitration is an alternative dispute resolution process which is popular in the construction industry. It is voluntary, so it can only occur when the parties agree to use arbitration. In New Jersey’s construction industry this generally occurs in the contract for the construction project. Agreements to arbitrate are favored under New Jersey construction law, and courts normally enforce them.

Published on: July 12, 2016

Solid Waste Transportation Compliance & Consulting

by Pauline M.K. Young

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The New Jersey Department of Environmental Protection (“NJDEP”) regulates, monitors, and enforces a wide range of environmental protection and conservation laws throughout the State of New Jersey. The NJDEP is a cohesive government organization which is involved in various programs and areas of environmental protection including recycling, clean water, air quality and pollution, open spaces, wildlife protection, business regulations, waste transportation and disposal, and other environmental areas.

Waste transportation and disposal is one of the major areas which the NJDEP monitors with the important goals of: eliminating illegal dumping (and thus land and water pollution), eradicating criminal activity from the waste removal industry due to a historic connection between the industry and illegal conduct, and educating waste handlers of relevant rules and environmental impacts.

To achieve these goals, the New Jersey State Legislature and the NJDEP have enacted numerous laws, rules, regulations, and reporting requirements for waste transporters. To start, most waste transporters are required to obtain a New Jersey A-901 license. The process for obtaining an A-901 license is not a quick or easy one. Before ever engaging in any waste transportation, the business must provide a great deal of information to the NJDEP, including the source of funding for the business, business locations, lease and lessor information, identification of owners and key employees, etc. On top of that each key employee, owner, partner, officer, director, and managing member must complete a disclosure form which requires a great deal of specific and detailed information such as information regarding family members, employment history, and other personal details. Moreover, each of these people need to be fingerprinted and have background checks conducted.

Published on: February 16, 2016

McLaughlin & Nardi, LLC Attorneys Recover $289,918 For Homeowners in Construction Arbitration

by McLaughlin & Nardi, LLC

McLaughlin & Nardi’s New Jersey construction attorneys recently completed a construction arbitration in the American Arbitration Association. After hearing the evidence, the arbitrator awarded our clients $289,918. Maurice McLaughlin was the lead trial attorney. He was assisted throughout by Pauline Young and Robert Chewning, who second chaired the hearings.

Background

The case involved Essex County homeowners who had contracted for extensive renovations to their kitchen. The total cost of the kitchen renovations was $152,725. The homeowners paid $126,362.50. However, the contractor never completed the job.

Published on: September 5, 2014

Retainage in New Jersey Construction Law

by Maurice W. McLaughlin

Retainage in New Jersey Construction Law

One of the areas which our construction lawyers often address is retainage.

The Use Retainage in New Jersey Construction Law

Retainage is an important device in construction law. Our attorneys have helped New Jersey contractors, subcontractors, owners and construction suppliers with issues related to retainage.

Retainage is an amount intentionally withheld from payment. It may be withheld by an owner from payment to a contractor, from a general contractor, to a subcontractor, or from a subcontractor to a lower tier subsubcontractor.

Retainage in Construction Contracts & Drafting Effective Retainage Provisions

Retainage is a creature of contract law. It is governed by the provisions of the contract or subcontract between the parties. Whatever the contract says about retainage will control; and if retainage is not provided for in the contract, it is not allowed.

Since the terms of the retainage are governed by the terms of the contract or subcontract, drafting the contract is extremely important. It is essential to have an experienced attorney on your side. Our construction attorneys negotiate and draft contracts, subcontracts and supplier contracts. We review construction contracts for our clients and advise them on their rights and responsibilities.

Litigation Over Construction Disputes

Disputes are common, as retainage is typically required to be paid when the work is “subtanitially complete.” Parties often disagree on what that term means. When these disputes arise, our attorneys fight aggressively for our clients’ rights in negotiations, mediation, arbitration and litigation. However, we first attempt to avoid these disputes by drafting clear language in contracts which protect our clients’ rights.
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Published on: October 4, 2013

New Jersey Home Warranty Program

by Boris Peyner

New Jersey provides new home owners with a warranty under New Jersey’s New Home Warranty and Builders’ Registration Act (“HOW”). The Act provides that newly constructed homes must conform to certain construction and quality standards and provide buyer of the new home with insurance-backed warranty protection in the event any of the standards are not met. Simply put, the Act provides that every new home sold in New Jersey comes with a warranty.

Builders of new homes must register with the New Jersey Department of Consumer Affairs to be permitted to engage in the business of building new homes. Builders are then required to provide a three-tiered warranty program which provides coverage and protection against defects.

Warranty coverage extends to defects caused by faulty workmanship and defective materials during the first year of ownership. The one year begins to run on either the first day of occupation or the settlement date, whichever is sooner. Additionally, during the first two years new home owners have a warranty that covers defects caused by faulty installation of heating, electrical, plumbing, and cooling systems. The Act, however, does not extend the coverage to appliances beyond the warranty provided by the manufacturer. Finally, the Act provides for warranty coverage to major construction defects of the home for ten years.

At first glance the Act appears to provide homeowners a cost-savings means of resolving disputes concerning construction defects. However, in reality the Act makes it difficult for homeowners to resolve construction defects. For example, “major construction” defects have been interpreted by the courts very stringently. Generally, the act affords no protection unless the new home is practically collapsing. Additionally, common problems such as leaks, mold, and excessive settling are not covered.
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Published on: November 23, 2012

New Jersey’s Highlands Water Protection and Planning Act

by Pauline M.K. Young

The Highlands Water Protection and Planning Act is a relative new law, signed by New Jersey’s then-Governor McGreevey on August 10, 2004. The Highlands Act seeks to protect the ecological integrity of the highlands region in northwest New Jersey. In short, the Act, under the New Jersey Department of Environmental Protection’s supervision, regulates and restricts development in the area. Indeed, it aims to protect and preserve not only the area’s animal and plant life but also a large source of fresh water for human consumption.

The New Jersey Highlands covers a vast span of the state covering over 1,250 square miles, and is home to nearly nine hundred thousand residents primarily in the counties of Warren, Morris, Hunterdon, Passaic, and Sussex.

Of the over eight hundred thousand acres of the Highlands region, nearly four hundred thousand acres have been designated as the Highlands Preservation Area. The remaining acres are designated as the Highlands Planning Area.
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