Changes To Look Out For In The New AIA Documents

May 2008
By Meagen E. Leary

The American Institute of Architects ("AIA") recently released the 2007 update of its family of standard contract documents. While the AIA has not made any earth-shattering overhauls to its documents, some changes to the contracts may impact the risk exposure of designers, contractors and owners. Parties to the new contracts are therefore encouraged to look out for the changes and consider the effects of such changes on their contractual services.

I. Expansion of the Family of Documents

Acknowledging the variety of construction projects today, the AIA has introduced a greater number of form contracts designed to accommodate such variety. B101, the standard form Owner-Architect agreement, replaces B141 and B151. B102 somewhat replaces B141 and is intended for projects without a pre-defined scope of services. B103 is tailored for large to extra large sized projects and is the most comprehensive of the Owner-Architect agreements. B104 is designed for large to medium sized projects. B105 is designed for small projects, such as the remodel of a single family home. B104 and B105 to a greater extent may not include some terms (e.g., insurance requirements, detailed scope descriptions or dispute resolution procedures in the B105 form) that a party considers to be key. Therefore parties using B104 or B105 may consider whether any terms contained in B101 or B103 should be used to supplement the smaller-size project forms.

A201 has been modified though it remains the General Conditions of the Construction Contract. B101 and B103 are intended to be used in conjunction with A201. B104 is intended to be used in conjunction with A107 which is a new Owner-Contractor form for projects of limited scope. B105 is intended to be used with A105, the new standard Owner-Contractor form for small projects.

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New Legislature Attempts to Compromise ADA compliance Interests with Practical Considerations of the Construction Industry

May 2008
By Brendan P. Bradley

Developers and general contractors often face difficult issues related to compliance with standards imposed by the Americans with Disabilities Act ("ADA"). Until now, project owners have faced a significant number of lawsuits filed by a disproportionately small group of disabled plaintiffs who sometimes base their claims on technicalities within the ADA. In an attempt to protect developer and contractors' interests from this small group of litigious plaintiffs who have created a cottage industry suing on ADA compliance issues, the legislature has attempted to reach a compromise culminating in State Senate Bill 1608. The bill attempts to encourage ADA compliance at the earliest phases of construction to prevent litigation and to clarify "standards" set forth under the ADA.

The bill requires judges to grant a temporary stay related to an ADA claim filed against building owners if the building has previously been inspected by a Certified Access Specialist ("CAS"). Further, the statute would entitle defendants with CAS certificates to a speedy evaluation conference before the judge in order to help expedite resolution or settlement of the dispute. This creates a clear incentive for building owners to have an inspection by a CAS at the outset in order to take advantage of protections afforded by the bill.

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New California Case Enforces Tolling Agreement Made Without The Consent of All Parties

May 2008
By Michael D. Wilson, Jr.

The California Court of Appeals, Second Appellate District recently published Landale-Cameron Court, Inc. v. Ahonen, 155 Cal.App.4th 1401 (2007), which held that where a condominium homeowner's association ("HOA") and a developer enter into an agreement to toll the three-year statute of limitations for negligent construction claims, the agreement will be binding on the developer's contractors and subcontractors who built the project, even if they did not sign the tolling agreement.

The statute governing tolling agreements and when an HOA may file a complaint alleging construction defects was substantially amended in 2001. Under the amended law, before a lawsuit is commenced, the HOA has to serve the builder, developer or general contractor a "Notice of Commencement of Legal Proceedings." This notice automatically tolls (stops) all statutes of limitations for a period not to exceed 180 days "against all potentially responsible parties, regardless of whether they are named in the notice, including claims for indemnity applicable to the claim." During this 180 day period, the party receiving the notice from the HOA may contact those who designed or built the improvements at issue, in order schedule an opportunity to survey and make repairs at the property. Only if the repairs cannot be effectuated or a cash settlement cannot be reached as to the defects may the HOA then file suit. If repairs are on-going and the participating parties agree, however, the parties may enter into a tolling agreement to extend the period for repairs for an additional 180 days. The key to the amended statute is that all parties have a voice in choosing to toll the statute of limitations the additional 180 days.

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Speaking Engagments

• On May 2-4, 2008, Phil Wang of Gordon & Rees LLP spoke at the 27th Annual Real Property Retreat at the Hilton La Jolla Torrey Pines in La Jolla California. Phil was a panelist on the topic of "Trouble in Commercial Leases - Default and Bankruptcy Issues. Panelists discussed commercial lease default and litigation issues as well as related bankruptcy provisions impacting the landlord/tenant relationship.