Fall is on its way and with it comes the annual ritual of the "fall clean up". The busy season of the spring and summer may be winding down or new types of project may be on the horizon. Either way, for contractors, an annual "fall clean up" for contractors should include a thorough review of business practices geared towards improving efficiency and performance especially in this difficult economy especially for the construction industry. Ensuring that you are running your business with a

By John T. Trout

Persons involved in the construction industry or with real estate in Minnesota should take note of the following legislative changes to the law, which take effect August 1, 2009.

Statutory Implied Warranties Have Become Mandatory Expressed Warranties. The statutory warranties for new construction and remodeling stated in Minnesota Statutes Chapter 327A ("Statutory Warranties") must now be included in all contracts for the construction of new homes or home improvements

By Sarah E. Fisher, Esq.

"Green" building has become increasingly popular as consumers look for ways to conserve resources, protect their health and, ultimately, save money. Cutting edge green building methods and products are no doubt exciting, but are too new to be used without first considering their unknown risks. Issues can arise from the performance of a particular system or product, or from a difference in the anticipated and actual return on a green build investment. A

In today's construction economy, unpaid subcontractors and suppliers with mechanic's lien claims often receive notice that the first mortgage holder is foreclosing on the property. The natural question and assumption by the mechanic's lien holders is "the mortgage company still needs to pay me, right?" Unfortunately, the answer to this question is usually "wrong." If the mortgage holder forecloses and takes over the property, it usually does not need to pay any mechanic's lien claims.

Anot

Sometimes it is a better strategy not to pursue lien foreclosure, but instead to pursue a prompt judgment on other claims. In a recent case, a subcontractor was owed a modest amount of money by the general contractor forwork on a project. A mechanic's lien statement was served and filed on behalf of the subcontractor, but the general contractor still failed to make payment.

Although a lien foreclosure action was considered, it would have involved multiple mortgage companies, several dozen ot

What Is an Indemnity Agreement?

One important feature of any agreement between a general contractor and a subcontractor is the allocation of risk between the parties. Any well-drafted contract should attempt to address a number of key issues:

• Who will be responsible if a third party is injured?
• Who will be responsible if the work is performed improperly and the work needs to be corrected?
• Who will be responsible for paying for the defense of a lawsuit resulting from defective co

In Parkos Construction v. Anchor Distribution, the Minnesota Court of Appeals reversed the dismissal of a misrepresentation claim against Anchor Distribution, when Anchor allegedly recommended the use of staples instead of nails in a roofing project.

In the winter of 1999, Parkos Construction was hired by the Kraus-Anderson Construction Company to install cedar shingles on the roof of the White Bear Yacht Club. The specifications for the project called for six-penny galvanized nails.

Jacobus DOLI-Approved Construction Education Coordinator

Shari Jacobus has been approved by the Minnesota Department of Labor and Industry as a construction education coordinator. In this capacity, Jacobus is developing coursework that meets professional training requirements to keep you current on existing laws and legislation that affect all areas of the construction industry. If you would like to recommend a topic as we expand our course portfolio, please contact Shari directly at 952-746-21

By Shari A. Jacobus, Esq.

Twas the night before the mechanic's lien expired on the big fancy house,

The general contractor wasn't stirring, the ungrateful louse.

I served my pre-lien notice and lien statement with care,

In hopes that my payment soon would be there.

The construction loan mortgagee was all snug in its bed,

Certain that of all the lien claimants, its mortgage was ahead.

And I with my toolboxes packed snug in my truck,

Sighed at the thought I might be out of luck

The general contractor says he need not pay me because the owner has not paid him. Is he right?

Generally, in a contract between the contractor and a subcontractor, the contractor bears the risk of an owner's failure to make payment to the contractor due to the owner's insolvency. However, should the subcontract agreement contain a properly drafted pay-when-paid clause, then the risk of an owner's failure to make payment to the general contractor for the subcontractor's work could fall up