When a party asserts the right to arbitrate a claim or dispute under a construction contract, some initial questions arise: Is there an enforceable arbitration clause? What is the scope of the arbitration agreement? Does it apply to this dispute? Collectively, these threshold matters are known as the “arbitrability” of the dispute. Traditionally, a court makes this determination as it is a question of law. It is possible, however, for the parties to the arbitration agreement to assign responsibility for determining arbitrability to the arbitrator.

In a recent Florida case, the arbitration clause expressly incorporated the American Arbitration Association Construction Industry Rules, which delegate the arbitrability determination to the arbitrator. The appellate court found this persuasive when it reversed a lower court ruling on arbitrability. The matter was remanded with instructions to send the question to the AAA arbitrator.

The second case in this issue involves a consolidated claim submitted on a federal construction contract. The claim comprised numerous sub-claims. The total consolidated claim was priced, as were most of the sub-claims. The unpriced sub-claims were dismissed for failure to state a sum certain. The contractor had the right, however, to resubmit those claims to the government contracting officer.

Courts usually rule on the arbitrability of a dispute, but authority can contractually be shifted to the arbitrator. A contract reference to the rules of the American Arbitration Association had such an effect.

In order to state a “sum certain” in accordance with the Contract Disputes Act, sub-claims in a consolidated claim have to be separately priced when based on distinct operative facts. While a consolidated claim withstood a motion to dismiss, several sub-claims were dismissed without prejudice.

Design professionals can have their licenses suspended or revoked for conduct unrelated to the practice of their profession. As with any other licensed professional, certain types of egregious behavior may indicate an individual is a danger to the public when practicing that profession.

A licensed architect designed two houses. There were no complaints about the designs or the architect’s practice of his profession. However, once the designs were complete, the architect contracted to serve as general contractor for the construction of the homes. It was alleged he diverted and misdirected contract payments during the construction process, which led to criminal indictments. His architect’s license was summarily suspended pending resolution of the criminal charges.

The second case in this issue involves the timing of the government’s baseline survey of elevations for purposes of measuring the quantity of unit-priced compacted fill. Did performance of the survey prior to, rather than after, clearing and grubbing of the site result in an understatement of the quantity of placed fill?

The third case addresses the difficult issue of bid security for an electronically submitted bid. Did the concurrent submission of an electronic image of a cashier’s check suffice? Or was the low bid rendered unsecured and nonresponsive?

The license of an architect, who also served as the general contractor on the projects he designed, was summarily suspended after he was accused of misapplying payments under the construction contracts.

In a unit-priced contract for the placement of compacted fill, performance of the baseline quantity survey prior to clearing and grubbing of the site was consistent with the terms of the contract and not inconsistent with customary construction practice.

A Louisiana appeals court has ruled an electronic depiction of a certified check, followed by prompt physical delivery after bid opening, was sufficient security for an electronically submitted low bid.

Contract retainage is intended to protect a project owner against deficient work, incomplete work and other forms of contract nonperformance. The 5–10% retained from each progress payment can add up to a significant sum over the course of the project. When project completion nears, the right to that retainage may become the source of disagreement.

The parties to a site improvement contract contested the contractor’s right to interest on unreleased retainage. The AIA contract form clearly called for interest on late progress payments, but was silent regarding interest on retained funds. A Pennsylvania court sidestepped a ruling on this issue, however, because the contractor had not provided the mechanic’s lien waivers that were a precondition to release of the retainage.

The other case in this issue involves the change order procedure in a fixed-price home construction contract. Neither party had followed the contractual procedure over the course of the project. Could the homeowners still challenge the builder’s pricing of upgraded or extra work?

AIA contract documents were silent as to whether interest on late progress payments also applied to the final payment of contract retainage. The contractor, however, had never provided the lien waivers required for final payment. Consequently, no interest could accrue to the unreleased retainage.

A fixed-price construction contract for a new home required advance written change orders, priced and signed, for changed work. The homeowners, through a course of conduct, waived the right to enforce that clause; however, they could still challenge the pricing of upgraded or extra work.