Contractors, will your current insurance policy cover “your work” as a joint venture partner?
The typical answer is NO. This is simply because your policy as a sole contractor is based upon a predicted scope of risk. A JV’s risk is usually larger than a sole contractor’s risk. Even a minority partner’s risk as a JV member is usually greater than as a sole contractor because each JV partner is liable for the entire risk of the JV, despite the JV agreement that may allocate that liability – that’s only applicable within the JV, not to outside parties.
Insurance coverage for a Joint Venture is typically either by:
- A specific policy for the JV or
- Separate policies for each JV member.
For Example:
On a student housing project in Raleigh, NC, a new building under construction by a JV started to lean, damaging other portions of the building. The JV and subcontractors repaired the work and out of the total repair costs of about $14.4 million, JV was responsible for about $4 million.
One of the two JV partners sought reimbursement from its own CGL insurer (not the JV’s insurer). The JV partner’s Insurer argued that the JV partner’s separate policy excluded coverage for the partner’s liabilities while working as a JV partner.
Thankfully, the JV partner had previously purchased a separate JV Endorsement to cover its potential liability to third-parties as a JV partner. The Court did not rule on whether there was coverage for liability between the two JV partners (i.e., liability within the JV, not between the JV and third-parties).
Adding Terms to a Government Contract without Saying So
Imagine an incredulous Contractor asking, “Show me in the Contract where it says I’m supposed to do X?” The Government Contracting Officer smugly answers, “even though the Contract doesn’t say so, you must do it anyway.” Is that even possible, when, how?
Differing Site Conditions: When the Part Does Not Equal the Whole
If all apples are fruit, then why are all fruit not apples?
Forum Selection Can Be a Home-Court Advantage
I promise that any disputes between us will be argued at your house. Time passes and a dispute begins to brew. Now, I want to argue at my house, not at yours. You pay costs to argue at my house that you wouldn’t have incurred had I done as agreed. Should I have to reimburse your costs?
No-Damage-for-Delay and Owner-Related Dispute Clauses are No Defense to Surety Liability Under Miller Act
Prime Government Contractors - you may need to update your interim payment waivers.
Contractual Fairness is Whatever the Parties’ Agreed
When you know a current action or inaction is wrong, but you do not object, should you be allowed to object later?
Which Comes First – Specifications or Drawings?
Sometimes it's not better to ask for forgiveness after-the-fact.
Government Contract Claims: When Appeal is Rejection of Settlement
Without a reservation of rights, appealing a Contracting Officer’s Final Decision is a rejection of any offer of payment or settlement included therein. So, the contractor had only three options.
Linking Obligations
If you want to bind the subcontractor to the prime in every way the same as the prime is bound to the owner, then the incorporation clause of the subcontract should be: . . .
Termination of Government Contracts for Convenience (T4C)
Imagine you’re a Government Contractor under a firm, fixed-price contract and you’ve done nothing wrong. Nevertheless, the Government has decided to unilaterally end its contract with you. Yes, the Government can do this...
