Construction Blog

The COVID-19 pandemic is causing widespread challenges in the construction industry. Employee safety concerns, forced project shutdowns, construction delays, and supplier interruptions are mounting. Contractors must carefully navigate these unprecedented times by knowing their contractual duties, regulatory obligations, and mechanic’s lien rights.

The construction industry is a leading target of cyber crime.  According to cybersecurity firms, one in every 382 e-mails in the construction industry contains malicious content, and nearly forty percent of construction industry employees are considered susceptible to cyber scams.  Given that cyber crime will only get more sophisticated and difficult to detect, failing to implement a cybersecurity plan is a serious gamble.  According to the National Cyber Security Alliance, 60% of small businesses survive less than six months following a data breach.  However, contractors can improve those odds by increasing security measures, training employees, and purchasing cyber insurance policies.   Furthermore, contractors without cybersecurity plans may fall behind competitors and fail to qualify for certain jobs, especially government projects. 

The Illinois Supreme Court rendered a very important decision on December 28th impacting the real estate and construction industry. In Sienna Court v. Champion Aluminum, the Court determined that the purchaser of a newly constructed home may NOT assert a claim for breach of an implied warranty of habitability against a subcontractor who took part in the construction of the home, where the subcontractor had no contractual relationship with the purchaser.

The Missouri Public Service Commission has entered a ruling which supports development in Missouri. Under its ruling, Missouri developers will not be required to pay a tax that investor-owned water and sewer utilities are now required to pay, as a result of a change made to the federal tax code by the 2017 Tax Cut and Jobs Act, on infrastructure that is contributed to them. Under a prior tariff that had been in effect in Missouri, developers were required to pay such taxes for investor-owned utilities. One developer of which we are aware was being asked to pay more than $300,000 in tax on a 66 lot development.

A recent Missouri Court of Appeals held that commercial general liability insurance does not provide coverage against certain construction-defect claims. In View Home Owners Association v. The Burlington Insurance Company, the court was presented with the question of whether the commercial general liability policy at issue provided coverage for negligent acts allegedly committed during the re-development of a blighted building into condominium units.