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Articles by David Adelstein
MILLER ACT PAYMENT BOND CLAIM “NO NOs!”
A recent federal district court opinion, Sauer Construction, LLC v. United Structures of Georgia, LLC, 2026 WL 2522849 (M.D.Fla. 2026), addressed two worthy considerations when it comes to a Miller Act payment bond claim. And, when I am talking about considerations, I am really talking about “no-nos.” These are things you don’t do. First, don’t file an untimely Miller Act payment bond lawsuit. Make sure, as a claimant, you file that lawsuit within one year from your final furnishing.
OWNER TAKING ASSIGNMENT OF GENERAL CONTRACTOR’S CLAIMS AGAINST A SUBCONTRACTOR(S)
Here’s a scenario that occurs in construction defect cases. An owner sues a general contractor and subs for construction defects. The owner settles with a number of parties and takes an assignment of the general contractor’s claims against some or all of the subs and pursues the remaining parties for indemnity based on the assignment of the general contractor’s claims. This was the scenario in Craftsman Plastering and Lath, Inc. v. Rath Mor, LLC, 2026 WL 2328032 (Fla. 4th DCA 2026).
TWO IMPORTANT POINTS REGARDING THE MILLER ACT
A recent Miller Act case, U.S. f/u/b/o Boundless Management Outsourcing Group, LLC v. Endurance Assurance Corp, 2026 WL 2241491 (D. Puerto Rico 2026), confirms two important points when it comes to the Miller Act. In this case, a subcontractor pursued a Miller Act payment bond lawsuit more than one year after its work was finished. The subcontractor also asserted a claim against the federal government. The lawsuit was dismissed.
LIENOR DEALING WITH “SHOW CAUSE” SUMMONS BY CONDOMINIUM UNIT OWNER
One of the statutory vehicles to shorten a construction lienor’s statute of limitations to foreclose on a construction lien is through a “show cause” summons that essentially requires the lienor to foreclose on the lien within 20 days from receipt of the “show cause” summons. This is a statutory procedure under Florida’s Lien Law in Fla. Stat. s. 713.21(4).
SURETY REQUIRING COLLATERAL SECURITY UNDER GENERAL AGREEMENT OF INDEMNITY
In order to procure bonds (payment and performance bonds), you need to sign a General Agreement of Indemnity (referred to as the “GAI”) with the surety (bonding company). It does not matter the surety issuing the bonds, the terms and conditions in the General Agreement of Indemnity are largely consistent. These terms and conditions are one-sided written in favor of the surety. This is because bonds are not insurance.
INSUFFICIENT NOTICE OF COMMENCEMENT AND CONSTRUCTION LIEN RIGHTS
When a party is preserving their construction lien rights, the party will look to the recorded Notice of Commencement. This is the recorded document that provides the lienor with the information for purposes of preserving construction lien rights. A Notice to Owner company will typically rely on the Notice of Commencement to serve Notices to Owners from lower tiers not in contract with the owner.
PRESUMPTION OF PREJUDICE APPLIES TO ALL AFFIRMATIVE DEFENSES REGARDING INSURED’S FAILURE TO COMPLY WITH POST-LOSS POLICY CONDITIONS
In a recent property insurance coverage dispute, an issue on appeal pertained to the “prejudice” jury instruction associated with the insured’s failure to comply with post-loss policy conditions. The trial court found that the prejudice only pertained to prompt notice and not other post-loss policy conditions. This was reversed on appeal as prejudice applied to ALL the post loss policy conditions that the insured failed to comply with, not just the prompt notice requirement.
PREFATORY CONTRACT LANGUAGE CANNOT BE USED TO CREATE AN AMBIGUITY WITH OPERATIVE PROVISIONS
Contract drafting and interpretation matters. A case dealt with the potential conflict with prefatory language in an agreement compared with operative provisions in the agreement. The trial court held that the operative provisions control. I discussed this case here where the appellate court reversed based on the prefatory language.
ANOMALY IN ADDING A THIRD-PARTY CLAIMANT TO A LIABILITY INSURANCE COVERAGE DISPUTE
In an insurance coverage lawsuit seeking declaratory relief, an insurer sued the third-party claimant. The insurer was seeking a declaration that there was no coverage, which naturally would impact the third-party claimant. The insured did not respond to the lawsuit and the insurer moved for a default judgment which was objected to by the third-party claimant.
MAKE SURE YOU UNDERSTAND WHAT TO INCLUDE AND NOT INCLUDE IN A LIEN
If you need a construction lien prepared, please work with a construction counsel in doing so. Don’t use a service that’s going to charge you less but isn’t going to analyze the information or ask you questions based on the information you provide them to include in the lien. You are selling yourself short if you prepare a lien “down and dirty” or “half-assed”.
CONTRACT INTERPRETATION - DETERMINING WHAT THE CONTRACT REQUIRES
A good ole dispute on contract interpretation in government contracting. Contract interpretation disputes happen all the time in every jurisdiction under the sun. Think about that. Now, what’s the best way to avoid a contract interpretation dispute? Naturally, invest in the contract language and fully understand the scope of work. Make all of this clear. But, of course, this isn’t foolproof meaning you could still be doing this and you could still find yourself in a contract interpretation dispute.
STANDING WHEN IT COMES TO REAL PROPERTY OWNED BY A TRUST
It is not uncommon for property to be owned in the name of the trust as part of an estate planning agenda. In construction, improvements are made all the time to real property owned in the name of a trust or later transferred to a trust for estate planning purposes. In a recent case, the question became that if the property is owned by the trust does only the trust have standing to file the lawsuit.
BREACH OF FIDUCIARY DUTY AND NEGLIGENT MISREPRESENTATION CLAIMS AGAINST INSURANCE BROKER
Can an insurance broker be liable for breach of fiduciary duty and negligent misrepresentation? Stated differently, can an insurance broker be liable for these claims even if the insurance broker has been found not to be liable for the negligent failure to procure insurance? Well, a recent appellate decision out of Florida’s 5th District Court of Appeals, confirms yes, with such claims being BROADER CLAIMS with BROADER DAMAGES than the negligent failure to procure coverage.
CAN FORECLOSURE SALE BE OVERTURNED BECAUSE SALE PRICE IS GROSSLY INADEQUATE?
Foreclosure actions are equity actions. See Verzura Construction, Inc. v. Hotel La Petitite Muse, LLC, 50 Fla.L.Weekly D2500a (Fla. 3d DCA 2025). Can a sale price at a foreclosure auction sale be set aside because the foreclosed party believes the sale price is grossly inadequate? A recent case discusses this question and, as you will see, the argument that the sale price is grossly inadequate is not enough to overturn a sale.
QUICK NOTE: IF YOU WANT TO RECOVER ATTORNEY’S FEES IN A CONTRACTUAL DISPUTE, INCLUDE A PREVAILING PARTY ATTORNEY’S FEES PROVISION
If you want the ability to recover attorney’s fees in the event of a contractual dispute, include a prevailing party attorney’s fees. Negotiate this point on the front end. Not doing so will hinder your ability to make the argument that you should be entitled to attorney’s fees due to a breach of the contract. In a recent case, the prevailing party relied on an indemnification provision to create the argument for attorney’s fees even though the action had NOTHING to do with indemnity.
GOVERNMENT CLAIMING CONTRACT IS VOID AB INITIO BY CONTRACTOR KNOWINGLY MAKING FALSE STATEMENTS
Can the federal government declare a contract “void ab initio” or void from the beginning? Yes, if the government can “prove that the contractor (a) obtained the contract by (b) knowingly (c) making a false statement.” MLB Transportation v. U.S., 2025 WL 2962897, *8 (Fed.Cl. 2025) (citation omitted).
PROMPTLY NOTIFYING YOUR INSURER OF A CLAIM MATTERS
Does promptly notifying your insurer of a claim matter? A recent case out of the 11th Circuit Court of Appeals answers this question in the affirmative. MAKE SURE TO PROMPTLY NOTIFY YOUR INSURER OF A POTENTIAL CLAIM. In L. Squared Industries, Inc. v. Nautilus Ins. Co., 31 Fla.L.Weekly C529a (11th Cir. 2025), an insured owned gas stations and had a claims-made storage tank liability insurance policy.
APPLICATION OF ORDINANCE AND LAW COVERAGE IN PROPERTY INSURANCE POLICY AND TWENTY-FIVE PERCENT RULE
A recent case involved a homeowner’s all-risk property insurance policy with ordinance and law coverage. This ordinance and law coverage required the carrier “to cover costs that the [insureds] incur as a result of any ordinance that requires them to replace ‘the portion of the undamaged part of a covered building or other structure necessary to complete the remodeling, repair or replacement of that part of the covered building or other structure damaged by a Peril Insured Against.” Weston v.
APPLICABILITY OF FLORIDA’S BUILDING CODE IS A QUESTION OF LAW
The application of Florida’s Building Code is a question of law for the court. It’s NOT a question for a witness to determine. In a recent personal injury dispute dealing with the tripping and falling on a public sidewalk, a key issue included the application of Florida’s Building Code on a Florida Department of Transportation (FDOT) project.
SUBSTANTIATING TERMINATION FOR CONVENIENCE COSTS
A termination for convenience clause is an important provision in construction contracts, particularly for the owner. An owner needs the contractual right to terminate a contractor for convenience. This means the owner does NOT need a reason to exercise a termination. This is night-and-day different from a termination for cause (or default) wherein an owner must have a material basis to exercise that right.
QUICK NOTE: DON’T SUE YOUR ARBITRATOR
As you know from prior posts, arbitration is a creature of contract. This means if you want arbitration to resolve your disputes, then include a binding arbitration provision in your contract. If you don’t want to arbitrate disputes, then do NOT include a binding arbitration provision in your contract. But whether you arbitrate or litigate, you may not like the arbitrator or judge that presides over your case. And, you may not like the outcome or rulings made during the course of the dispute.
It is common for construction contracts to include a choice-of-law provision or language. This is language that says the contract is to governed under the laws of the state of Florida (by way of example). Pick any jurisdiction. There may be other language in the provision, but the gist is that if there is a dispute arising under the agreement, the laws of the state designated in the choice-of-law provision will apply.
INSURANCE BROKER CAN BE LIABLE FOR OMISSION OF COVERAGE
Claims against an insurance agent / broker can be actionable in negligence. Such a claim can arise with omitted insurance. “The party seeking to establish that improperly omitted insurance coverage was available must only show that ‘the requested coverage was generally available in the insurance industry when appellee obtained coverage for appellant.’” Leavitt Recreation & Hospitality Ins., Inc. v. Florida Caverns R.V. Resort, LLC, 50 Fla. L. Weekly D1641a (Fla. 1st DCA 2025) (citation omitted).
QUICK NOTE: DOCTRINE OF REASONABLE EXPECTATIONS DOES NOT APPLY TO INSURANCE POLICIES
The doctrine of “reasonable expectations” does NOT apply to insurance policies. Catalina West Homeowners Association, Inc. v. First Community Ins. Co., 50 Fla.L.Weekly D1318a (Fla. 3d DCA 2025).
QUICK NOTE: TERMINATION FOR CONVENIENCE PROVISIONS GIVE A PARTY BROAD DISCRETION TO END A CONTRACTUAL RELATIONSHIP
In a recent case, Tripro Consulting, LLC v. CACI-Inc.-Federal, 2025 WL 1832849 (MD Fla. 2025), a cybersecurity subcontractor argued it was improperly terminated under a provision that allowed the contractor to terminate it for convenience if it was in the contractor or government’s (owner) best interest.
A non-construction case touches upon important considerations regarding arbitration and agency principles. Agency principles matter and while this case deals with agency principles relative to arbitration, the principles can be extrapolated to a variety of scenarios. Here are the key facts in the case. A mother obtained tickets to a football game and brought her daughter. Her daughter was injured at the game and her daughter filed a lawsuit against the stadium/team.
A CONTRACT IS A CONTRACT: RELEASES AND CHANGE ORDERS / BILATERAL MODIFICATIONS ARE CONSTRUED AS CONTRACTS
A contract is a contract. It should say what it means and means what it says. A release is construed like a contract. A change order or bilateral modification is construed like a contract. The decision out of the United States Court of Federal Claims, B.L. Harbert International, LLC v. US, 2025 WL 914388 (Fed.Cl. 2025), serves as a case on point.
SPEARIN DOCTRINE CAN APPLY IN DESIGN-BUILD CONTEXT
The Spearin doctrine is a doctrine in the construction industry that broadly means the owner impliedly warrants the constructability of the plans and specifications given to the contractor. This implied warranty attaches to a design specification, but not a performance specification. A question arises as to whether the Spearin doctrine can apply in the design-build context where the contractor is responsible for both the design and construction. It can, as discussed in the case below.
FOLLOW THE DISPUTE RESOLUTION PROVISION(S) IN YOUR CONTRACT
When you are in a dispute, one of the first things you want to look at is the dispute resolution provision(s) in your contract. What does the provision(s) say? (There could be more than one provision.) Do you need to mediate first? Are disputes decided via arbitration or litigation? Is there a venue provision? Is there a waiver of jury trial? Is there an attorney’s fees provision? Is there a choice of law provision? You want to know this BEFORE you proceed with escalating the dispute.
MAKE SURE YOU COMPLY WITH FLORIDA’S PRE-SUIT NOTICE REQUIREMENTS FOR CONSTRUCTION DEFECTS
Welcome to Florida! If you deal with construction defects in Florida, then you know, or certainly should know, about Florida Statutes Chapter 558. Chapter 558 contains the pre-suit notice requirements before instituting a construction defect lawsuit. They are a “must know” if you practice in the construction defect world. While I may not be a huge proponent for the Chapter or view it as value-added when you factor in numerous considerations, how I feel is of no moment.
…MORE ON DELAY CLAIMS AND THE BURDEN OF PROOF SUBSTANTIATING DELAY
How about some more on DELAY claims and the burden of proof substantiating delay. Delay claims can no doubt be complex – factually and legally. They warrant expert opinions further bolstered by fact witness testimony from the folks that lived the details and issues. If you need assistance with a delay claim, make sure you have the right representation to best position the claim, the arguments, and the burden of proof to substantiate the claim.
TIME IS MONEY ON CONSTRUCTION PROJECTS AND CATEGORIES OF DELAY
As we know on construction projects, the adage “time is money” always applies. It applies to contractors just as much as owners. If a project is delayed, a contractor incurs additional overhead costs known as general conditions and general requirements which are driven by time. Similarly, an owner experiences its own delay damages driven by time which can be in the form of loss of use, increased or additional financing, and increased or additional consulting (architect/engineering) costs.
KEEP AN EYE OUT ON WHAT YOUR INSURANCE POLICY AND CONTRACT SAYS
There is a very good reason the contract requires the party providing a service (e.g., subcontractor) to name the paying party (e.g., general contractor) as an additional insured under its liability policies (e.g., CGL policy) on a primary and non-contributory basis. There is also a very good reason why you, as an insured, should read the contracts you sign with the party providing a service for you.
KNOW YOUR BURDEN OF PROOF IN AN INSURANCE COVERAGE DISPUTE DEALING WITH AN ALL RISK POLICY
Understanding your burden of proof is vital. The burden of proof goes to what a party NEEDS to prove to satisfy or prove the claims or defenses asserted. It’s need-to-know when litigating and trying a case (whether in court or arbitration). The insurance coverage dispute of Valer v. Citizens Property Insurance Corp., 50 Fla.L.Weekly D126a (Fla.
PROVIDING YOUR INSURER PROMPT NOTICE
Sometimes, when it comes to insurance, you may hear the argument that you breached your insurance policy by failing to provide your insurer with prompt notice as the insurance policy requires. Well, this is not such an absolute issue. With that said, you should absolutely provide your insurer with prompt notice of a claim or loss. No legitimate reason not to.
IMPAIRING YOUR INSURER’S SUBROGATION RIGHTS
Liability insurance policies have a provision that allows them to subrogate to the rights of their insured. This provision is commonly referred to as a transfer of rights provision and reads: If the insured has rights to recover all or part of any payment we have made under this Coverage Part, those rights are transferred to us. The insured must do nothing after loss to impair them. At our request, the insured will bring “suit” or transfer those rights to us and help us enforce them.
DON’T IGNORE A NOTICE OF CONTEST OF LIEN
A recent case, Jon M. Hall Company, LLC v. Canoe Creek Investments, LLC, 49 Fla.L.Weekly D812a (Fla.
A TERMINATION FOR CONVENIENCE IS NOT A TERMINATION FOR DEFAULT
A termination for convenience is NOT a termination for default. They are NOT the same. They should NOT be treated as the same. I am a huge proponent of termination for convenience provisions because sometimes a party needs to be able to exercise a termination for convenience, but the termination is not one that rises to a basis for default.
YOUR CONSTRUCTION CONTRACT
Your construction contract is an important topic. What’s even more important is YOUR process for reviewing and negotiating construction contracts. Are you simply acting as a riverboat gambler willing to assume undue risk because you don’t value the investment in understanding what you are signing? If so, it becomes hard to complain about what you agreed to and signed when you chose NOT to invest in the process.
PRODUCTS LIABILITY LAW - APPLICATION OF ECONOMIC LOSS RULE
When it comes to product liability law, one important doctrine that will always come up is the economic loss rule. The economic loss rule, oftentimes going by its acronym ELR, lives and breathes in the realm of product liability law. Does the economic loss rule extend to a manufacturer’s distributor for a duty to warn when the product is NOT defective? A recent opinion out of the Eleventh Circuit Court of Appeals, NBIS Construction & Transport Ins. Services v.
DON’T FALL IN TRAP OF BUYING THE CHEAPEST INSURANCE POLICY AS IT MAY BAD FOR YOUR BUSINESS RISKS AND NEEDS
Don’t fall in the trap of buying the cheapest insurance policy. It will come and bite you in the butt big time! Consult with an insurance broker that understands construction and, importantly, your specific industry, to provide you coverage within your industry. Otherwise, you’ll be paying for a policy that may (i) not be a good policy, and (ii) may provide you minimal to no value for your industry’s RISKS and NEEDS when factoring in exclusions.
CHALLENGING ENFORCEABILITY OF LIQUIDATED DAMAGES (IN FEDERAL CONSTRUCTION CONTEXT)
A recent summary judgment opinion from the Armed Services Board of Contract Appeals (ASBCA), Appeals Of – BCI Construction USA, Inc.,ASBCA No. 6257, 2024 WL 773324 (2024), contains a worthy discussion regarding a contractor’s challenge to the government’s assessment of liquidated damages, specifically the enforceability of the liquidated damages rate. Although this challenge is in the federal context, this discussion would be more expansive and apply outside of the federal context.
FRAUD CLAIMS AND BREACH OF WARRANTY CLAIMS AGAINST MANUFACTURER
A recent case touches upon two issues that are noteworthy when considering fraud claims and breach of warranty claims against a manufacturer. Below contains a discussion on these claims. “Florida’s independent tort doctrine provides that a party may not recover in tort for a contract dispute unless the tort is independent of any breach of contract.” MidAmerica C2L Inc. v. Siemens Energy, Inc., 2024 WL 414620, *6 (M.D.Fla. 2024).
COMPETENT, SUBSTANTIAL EVIDENCE CARRIES DAY IN BENCH TRIAL
A number of construction disputes, if tried, are tried through a bench trial meaning the judge is serving in the role of the jury in the construction trial. In a bench trial, two points are important. First, “the factual findings of the judge are entitled to the weight of a jury verdict.” Q.G.S. Development, Inc. v. National Lining Systems, Inc., 2024 WL 357984 (Fla. 3d DCA 2024) (internal quotation and citation omitted).
LET’S TALK ABOUT A STATUTORY FIRST-PARTY BAD FAITH CLAIM AGAINST AN INSURER
Let’s talk about a statutory first-party bad faith claim against an insurer under Florida law. A recent opinion, discussed below, does a nice job providing a synopsis of a first-party statutory bad faith claim against an insurer: The Florida Legislature created the first-party bad faith cause of action by enacting section 624.155, Florida Statutes, which imposes a duty on insurers to settle their policyholders’ claims in good faith.
THE WORD “ESTIMATE” IN A CONTRACT MATTERS AS TO A COMPLETION DATE
Language in a contract matters. The word “estimates” or “estimated” matters particularly when it comes to a date certain such as a substantial completion or completion date. Remember this. Here is an example. In Parque Towers Developers, LLC v. Pilac Management, Ltd., 49 Fla.L.Weekly D190a (Fla. 3d DCA 2024), a trial court held that the developer did not complete the construction of five condominium units by the date in the purchase agreements.
RULING DEALING WITH CONSTRUCTIVE CHANGES, CONSTRUCTIVE SUSPENSION, AND THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING
A dispute pending in the Armed Services Board of Contract Appeals (ASBCA) dealt with interesting legal issues on a motion to dismiss. See Appeals of McCarthy Hitt-Next NGA West JV, ASBCA No. 63571, 2023 WL 9179193 (ASBCA 2023). The dispute involves a contractor passing through subcontractor claims due to impacts caused by the COVID-19 pandemic and the government’s response to the pandemic.
NO COVERAGE UNDER INSTALLATION POLICY WHEN READ TOGETHER WITH INSURANCE APPLICATION
A recent case out of the Eleventh Circuit denied an underground contractor’s claim under what appears to be a commercial property installation floater policy (inland marine coverage) that covers the contractor’s materials. Whereas a builder’s risk policy is more expansive, an installation floater is narrower and can provide protection to a contractor for materials and equipment in transit, stored, or being installed subject to the terms of the installation floater policy.
DOES “FAULTY WORKMANSHIP” CONSTITUTE AN OCCURRENCE UNDER YOUR CGL POLICY?
There is nothing more scintillating than an insurance coverage dispute, right? Well, some folks would agree with this sentiment. Others would spit out their morning coffee in disagreement. Regardless of where you fall in the spectrum, they are always important because maintaining insurance is a NECESSARY part of business, particularly in the construction industry. The ideal is to have insurance that covers risks you are assuming in the performance of your work.
SPECIFICATION CHALLENGE; EXCUSABLE DELAY; TYPE I DIFFERING SITE CONDITION; SUPERIOR KNOWLEDGE
An Armed Services Board of Contract Appeals dispute, Appeal of L.S. Black-Loeffel Civil Constructors JV, ASBCA No. 62402, 2023 WL 5827241 (ASBCA 2023), involved which party bore liability for delay—the federal government or the prime contractor–based on various legal theories.
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