Week 7

Class 7 outlines

Payment

Doctrine of conditions
Progress payments: AIA A201-2007 ¶ 9.6
- Schedule of values: ¶ 9.2
- Application: ¶ 9.3
- Progress observation evaluation: ¶ 9.4.2
- Certified amounts: ¶¶ 9.4, 9.5
- Time of payment
- Passage of title
- Assignment
- Lender involvement: ¶ 9.6.7
- Joint checks
- Surety demands
- Nonpayment remedies: ¶¶ 9.7, 13.6
- Defect waiver? ¶ 9.6.6
- No divisibility of contract
Retainage: redundant? interest? ¶ 9.8.5
Substantial completion: ¶ 9.8
Completion and final payment: ¶ 9.10
- Hurley v. Kiona-Benton (1923)
- Waiver of claims: ¶ 9.10.5
Payment despite noncompliance: substantial performance
- Plante v. Jacobs (489)
  103 N.W.2d 296 (1960)
- Eastlake v. Hess (1984)
- Panorama v. Golden Rule, 102 Wn. App. 422 (2000)
- Crest v. Costco, 128 Wn. App. 760 (2005)
- Mayer v. Sto Indus., 156 Wn. 2d 677 (2006)
- Unjust enrichment
- Waiver
Design professionals’ liability problems with payment process

Performance problems

Expectations and disappointments: owner v. contractor
Claims’ bases
- Fraud
- Concealment
  - Norris v. Church, 115 Wn. App. 511 (2002)
  - Nguyen v. Doak Homes, 140 Wn. App. 726 (2007)
- Misrepresentation
  - Alejandre v. Bull, 159 Wn. 2d 674 (2007)
  - Jackowski v. Borchelt, 151 Wn. App. 1 (2009)
- Negligence
  - Stuart v. Coldwell Banker (1987)
  - Davis v. Baugh Indus. Contractors, 159 Wn. 2d 413 (2007)
- Strict liability
- Contract breach
- Express, implied warranty
  - Tex v. Broadway, 149 Wn. 2d 204 (2003)
- Consumer protection; residential defects
Claims’ defenses
- Contractual risk assumption
- Mutual mistake
- Impossibility: commercial impracticability
- Frustration
- Acceptance
- Statutes of repose: RCW 4.16.300-.320 (L 67, 86, 02, 04)
  - Hudesman v. Meriwether (1983)
  - Jones v. Weyerhaeuser (1987)
  - Condo Ass’n v. Apartment Sales (2000) affirmed
    - Condo Ass’n v. Apartment Sales (2001)
  - Parkridge v. Ledcor, 113 Wn. App. 592 (2002)
  - SSB 6409 § 9 (L 02): construction defect claims [ report]
  - HB 2269 (2005): add geologists?
  - SB 5044 (2007): 6 10 years; structural defects exempt
  - Not for non-integral equipment
    - Condit v. Lewis, 101 Wn. 2d 106 (1984)
  - Not for sellers
    - Pfeifer v. Bellingham (1989)
  - Not for manufacturers: uncertainty resolved?
    - Washburn v. Beatt, 120 Wn. 2d 246 (1992)
    - “Manufacturer” defined: RCW 7.72.010(2)
    - HB 1596 (1999): beneficiaries, not manufacturers
    - Graham v. Concord, 100 Wn. App. 851 (2000)
    - SSB 6600 (L 04): beneficiaries defined [ report]
  - Not for setting general safety standards
    - Meneely v. Smith, 101 Wn. App. 845 (2000)
      
      “Justices deny appeal of pool-injury award”
      The Seattle Times (9 Feb 01)
  - Not for fraud?
    - Not in NV: NRS 11.202 (L 83)
      
      “Time limit no bar to concealed defect claim”
      Engineering News-Record (4 Aug 97)
    - SHB 2004 (2005): residential concealment [ report]
    - E2SSB 5895 (2009): residential fraud [ report]
- Statutes of limitation: RCW 4.16 generally
  - Commencement: ¶ 13.7
    - Negligence: discovery rule
      - Kundahl v. Barnett (1971)
      - Gevaart v. Metco (1988)
      - Clare v. Saberhagen, 129 Wn. App. 599 (2005)
    - Fraud: discovery rule
      - RCW 4.16.080(4) (L 1854 ... 1989)
      - Hudson v. Condon, 101 Wn. App. 866 (2000)
      - Sloan v. Thompson, 128 Wn. App. 776 (2005)
    - Breach of contract: discovery rule short-lived?
      - Taylor v. Puget Sound, 64 Wn. 2d 534 (1964)
      - North Coast v. Factoria (1999)
      - Architechtonics v. Khorram (2002)
      - SHB 2039 (L 03): affirmative defenses [ report]
        Discovery irrelevant? RCW 4.16.326(1)(g)
      - 1000 Virginia v. Vertecs, 158 Wn. 2d 566 (2006)
      - Owners Ass’n v. Madison Harmony, 143 Wn. App. 345 (2008)
    - Insurance
      - Schwindt v. CIC, 140 Wn. 2d 348 (2000)
      - Panorama v. Allstate, 144 Wn. 2d 130 (2001)
  - Contract may shorten
    - Yakima Asphalt v. DOT, 45 Wn. App. 663 (1986)
  - Apply to local—not state—government
    - Bellevue v. Brazier (1984) reaffirmed
      - Bellevue v. Brazier (1984)
    - RCW 4.16.160 (L 1854 ...) clarified (L 86)
    - PFD v. Hunt-Kiewit, 165 Wn. 2d 679 (2009)
      
      “Washington Supreme Court holds the statute of
      limitations does not apply to Safeco Field construction”
      K&L Gates (26 Mar 09)
- Sovereign immunity
Restitution
Applications
- Increased performance cost
- Labor disruptions: ¶ 8.3.1
- Project destruction
  - Insurance: subrogation waiver: ¶ 11.3.7
  - Touchet Valley v. Opp & Seibold (1992)
  - Anderson Hay v. United, 119 Wn. App. 249 (2003)
- Governmental acts
- Defective specifications: U.S. v. Spearin (515)
- “Impossible” specifications: UW Hospital Addition
- Weather: DBM v. State (1985)
- Financial problems: ¶¶ 2.2.1, 14.1.1.4
- Hazardous materials: ¶ 10.3