Arbitration Clauses: Pros and Cons
Whether a contractor enters into a direct agreement with a customer or is acting as a subcontractor and is required to sign a subcontractor agreement, the document will most likely contain a dispute resolution clause. The clause might simply state where disputes will be heard (i.e. “all disputes and claims shall be governed by Minnesota […]
Wood Flooring Disputes: Should You Choose Court Trial Or Arbitration?
If you’ve entered into a contract with a customer, chances are good that you’ve approved via your signature some sort of dispute resolution-maybe you agreed that disputes will be heard at a particular location, or maybe you agreed to a specific form of dispute resolution. Did you realize that? Parties often simply sign the agreement […]
IRS “Safe Harbor” for misclassified employees?
Recently the Minnesota Department of Labor and Industry (“DOLI”), the Federal Department of Labor and the IRS entered into an enforcement partnership to pursue companies that misclassify employees as independent contractors. Then, just days later, the IRS announced a new program intended to assist employers to “voluntarily reclassify” independent contractors to employees. Named the “Fresh […]
40 Ideas to build on for business success
Dear Friends, Clients and Colleagues: I am extremely pleased to have been honored as one of the “40 Under Forty” by the Minneapolis/St. Paul Business Journal for 2009. This award is especially meaningful because it reinforces the importance of leadership, entrepreneurial vision, and creativity. It’s every company’s goal. It’s an elaborate process, requiring continual momentum. In celebration, […]
The mortgage company needs to pay me, right?
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 […]
Pre-lien notice laws clarified: Two recent cases help contractors
Two recent cases decided by the Minnesota Court of Appeals have clarified Minnesota law regarding mechanic’s lien pre-lien notices. Both decisions bode well for contractors in enforcing their future mechanic’s lien rights. Printed or Typewritten? The first case involved the technical requirements for the visual appearance of a pre-lien notice. The law provides certain type […]
A primer on Minnesota Public Payment Bonds
In a previous article, we discussed Performance Bonds, which ensure that public construction projects are completed according to contractual terms. This article will offer a general overview of the related concept of payment bonds which, just as they sound, are bonds to ensure payment for work performed. The Minnesota Public Payment Bond statutes (“Bond Laws”) […]
Construction Law: Fact or Fiction?
FACT OR FICTION: A construction bid is an offer, and if it is accepted, a legal contract is formed. ANSWER: FACT! A contract is a promise, or a set of promises, to which the law attaches a legal obligation. For a contract to be enforceable there must be an offer and an acceptance of the […]
Pay When Paid Clauses: Are They Enforceable?
The “pay-if-paid” or “pay-when-paid” clause is frequently included in subcontracts. These clauses state that the general contractor is not required to pay the subcontractor unless and until the project owner pays the general contractor. Such provisions can be problematic to subcontractors when collection action is necessary. If the subcontractor demands payment, the general contractor may […]
Constitutional Liens
NO MECHANICS LIEN RIGHTS? TRY A CONSTITUTIONAL LIEN Most people in the construction industry are familiar with mechanics liens. Under Minnesota law, if a contractor or material supplier is not paid for its services, it may file a lien against the real estate involved to secure payment. There are many rules to follow in perfecting […]