Posted on July 22, 2009 by Marcus Eyth

Oregon False Claims Act Becomes Law

A couple of weeks ago I blogged about the Oregon False Claims Act,  a bill that made its way through the house and the senate and was on its way to the governor's desk for signature.

The large number of inquiries I have received about the bill speaks volumes about the impact this law will have on contsruction contractors and how seriously folks in the industry need to take this piece of legislation.

Indeed, the governor signed the bill.  So Oregon now has a state version of the Federal False Claims Act.  

The law goes into effect January 1, 2010 and can be found at OR Laws Chapter 292.

So contractors (and subcontractors) that do public procurement work beware....

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Posted on July 22, 2009 by Marcus Eyth

No Damages For Delay Provisions

Are No Damages for Delay Provisions enforceable in Oregon?  That depends (favorite lawyer's response, but true)...

In summary, these provisions are:

  • enforceable on private projects
  • unenforceable in public procurement prime contracts
  • probably enforceable (but TBD) in public procurement subcontracts

In essence, these provisions limit a contractor's remedy in the event of a delay to a time extension, but no dollars.

For almost 100 years, no damages for delay provisions were enforceable in Oregon in all construction contracts.  See Manerud v. City of Eugene, 62 Or 196, 205, 124 P 662 (1912).

Then, in 2005, the Oregon legislature enacted ORS 279C.315 (previously ORS 279.063), making these provisions void as against public policy and unenforceable in public prime contracts. 

But what about subcontracts on public procurment projects? 

The law there is unsettled since the legislature was silent on subcontracts.  Since general contractors typically include such provisions in their subcontracts, I'm sure it's just a matter of time before that case makes its way through the courts...

 

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Posted on July 1, 2009 by Marcus Eyth

The Construction Contractors Board: A Viable Option

No doubt, the economic downturn has affected the construction industry in many ways.

One problem is that some overstretched contractors are not paying their subs from the money they receive from building owners.  Not surprisingly, subcontractors have been busy filing liens, and usually recovering on them.  

What can owners do who are forced to pay twice (to the sub and the contractor) other than engaging in lengthy and expensive litigation?

Try filing a Complaint with Construction Contractors Board (CCB), which offers attractive benefits, including:

  • limited filing fees
  • possible recovery of attorneys fees and costs
  • quicker resolution (no protracted litigation)
  • simpler and less formal hearing procedures (hearsay evidence admissible)
  • $20,000 recovery through contractor's bond if successful

Yes, there IS a pot of money  if you win, even if the overstretched contractor is on the brink of going belly-up.  In Oregon, succesful CCB claimants simply submit the CCB decision to the surety and get paid.

Not a bad option, at least when your claim is not too far in excess of  the $20,000 bond requirement. 

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