April 24, 2008 – Construction Law

Partial Enforcement of Award Which Has Not Yet Become Final

Apr 24 2008

IPCO (Nigeria) Ltd. v Nigerian Nat’l Petroleum Corp., 2008 WL 1771454, [2008] EWHC 797 (Queen’s Bench Div., Commercial Ct.)

IPCO contracted with NNPC to design and build a petroleum export terminal in Nigeria. A dispute ensued and was arbitrated in Nigeria, subject to the supervision of the Nigerian courts. IPCO obtained an award in October 2004 (in the sum of approximately US$152 million) and sought an order for its enforcement in England. At the same time, NNPC brought an appeal against the award. The English High Court granted an order to IPCO, but adjourned enforcement of the award pending the Nigerian appeal. Subsequent developments in Nigeria had meant that any appeal against the award now lay some five or ten years in the future. IPCO applied for a variation of the order adjourning enforcement of the award. Read More

Appellate Court Finds Liquidated-damages Clause Was Not a Penalty and Thus Was Enforceable

Apr 24 2008

Mineo v. Lakeside Village of Davie, LLC, 983 So. 2d 20 (Fla. Dist. Ct. App. 2008)

Where a contract for the purchase of real property and construction of a residence gave the seller the option of retaining deposits and change order payments as liquidated damages in the event of the buyer’s default, or the seller could sue for specific performance at the purchase price plus interest as delay damages, the liquidated damages provision was not an unenforceable penalty because the contract did not provide the seller with the option to sue for actual damages (which would have change the character of the forfeiture as agreed damages).

Subcontractor’s Contractual Indemnity Obligation to Contractor for EIFS Damage Not Covered by Indemnity Provisions of Texas Product Liability Act

Apr 24 2008

K-2, Inc. v. Fresh Coat, Inc., 253 S.W.3d 386 (Tex. App. 2008)

In this case, the court held that the Texas Product Liability Act did not provide a product seller with the right of indemnity against a product manufacturer for that seller’s independent liability under a contract.

Several homeowners sued their builder, its subcontractor which installed synthetic stucco cladding (EIFS) on their houses and the EIFS manufacturer after experiencing water penetration leading to structural damage. After the claims made by the homeowners and the home builder against the subcontractor were settled, the subcontractor obtained a judgment against the manufacturer for indemnification of the amounts it paid in the settlement. The manufacturer appealed that portion of the judgment finding it liable to indemnify the subcontractor for the amount it paid to settle the home builder’s claims because it was paid under an indemnity clause in the subcontract. It did not dispute that part of the judgment obligating it to indemnify the subcontractor for settlement of the homeowners’ claims. Read More

Archive:April 24, 2008