Construction costs are bound to increase substantially when contractors or subcontractors are faced with unexpected conditions at the jobsite.  Knowledgeable members of the construction industry seek to address this problem through “differing site conditions” or “concealed conditions” clauses in their contracts.The current AIA General Conditions have a “concealed or unknown conditions” clause that says: “If the Contractor encounters conditions at the site that are (1) subsurface or otherwise concealed physical conditions that differ materially than those indicated in the Contract Documents, or (2) unknown physical conditions of an unusual nature that differ materially from those ordinarily found to exist or

Long gone are the days when a handshake was all that was needed to get a contractor to build a building and for him to be assured he would be paid. Today�s construction contracts, like most other contracts, are lengthy documents intending to address all possible issues that may arise during contract performance. But they frequently fail, or they provide unexpected consequences. For example, the often-used AIA contract for construction AIA Document A-102 - 2007 cost-plus with a guaranteed maximum price contract is 13 pages long. It is usually combined with the associated AIA General Conditions, which is another 11

WOLF To prevent parties from pursuing claims in court or arbitration that are stale because of the passage of time when witnesses and exhibits may be unavailable, various statutes of limitations (SOL) exist that limit times for starting legal proceedings.�The Colorado statute applicable to construction defect claims against construction industry participants (contractors, subcontractors, architects, engineers, etc.) requires that suits be started within two years after construction defects have been or should have been�in the exercise of reasonable diligence (care)�discovered.�There are limited exceptions.�On top of that, a Colorado statute of repose bars all such claims if not started within six years.�However,

Before 2007, frequently used American Institute of Architects construction contract forms provided for arbitration of contract disputes to be administered by the American Arbitration Association. Because of disappointments of some industry members with arbitration, the 2007 AIA contract forms (and the newly introduced ConsensusDOCS contract forms) allow choices between arbitration, litigation or “other” (arm wrestling?). Check the box. What are the relative merits of arbitration vs. litigation? Here are a few factors to consider: Cost.  Although in earlier years arbitration costs were thought to be lower because there was only limited discovery (depositions, written interrogatories and the like) and no

The 2010 session of the Colorado legislature passed a law requiring that automobile insurance policies be written in plain language not exceeding 10th-grade reading levels. Rather than doing the same for construction professionals� insurance policies, the legislature, in the very same session, passed laws relating to those complex policies on how they should be interpreted and applied by the courts. The term �construction professionals� means architects, contractors, subcontractors, developers, builders, builder-vendors, engineers and inspectors performing or furnishing the design, supervision, inspection, construction or observation of construction of real property improvements like houses, buildings, etc. Those industry members are commonly insured

What happens to subcontractors when owners can’t pay their general contractors? If their subcontracts have “pay-if-paid” provisions, the subcontractors may be out of luck. Those provisions mean that if the general does not get paid, it does not have to pay its subcontractors. While there are a number of courts in other states that have declared pay-if-paid clauses to be unenforceable, that is not presently the rule in Colorado. The last time the Colorado Supreme Court addressed the question, it suggested that pay-if-paid provisions would be enforceable in Colorado if (1) they clearly state that payment to the general contractor