Guest Post: Derek Singleton, ERP Analyst, Software Advice

“At Software Advice, we spend a lot of time reviewing construction software of every variety. While we’re well-versed in the promised benefits of various systems, we’re always interested to know whether those benefits are realized by companies. Toward that end, we decided to survey the construction estimating industry to find out whether estimating software actually helps companies win bids.

To get responses, we enlisted the help of everyone from construction bloggers to LinkedIn group admins and construction associations. Ultimately, we came up with a set of benchmark findings that will allow estimators to compare themselves against industry standards.

More than 100 companies responded to the survey and shared their thoughts on how to effectively estimate. The companies that responded to the survey represent a variety of trades and company sizes.

While the types and sizes of construction companies participating in the survey varied, there were a few commonalities between companies and how they estimated their jobs. For instance, while the jury is still out as to whether spreadsheets are a good method of estimating, a majority of companies that use an estimating system found that the software helped them perform better estimates.

Of course, as one participant noted, it’s possible that the people who use estimating software are more meticulous in their data entry by nature. However the strong correlation between estimating software and effectiveness suggests that having an automated system at hand improves your ability to estimate.

There were also some interesting findings about how accurate your estimating data is and the method used. As an example, participants that use an estimating program reported that they underbid projects only 5 percent of the time. Meanwhile, companies that rely on spreadsheets report that they underbid roughly 15 percent of the time.

If you’re interested in finding out more about the results of our survey, please visit our website where we are hosting the results at: 2012 ConstructionEstimatingBenchmarkReport.

It’d be great if you can share your thoughts on whether these findings match your own experience as well. Also, if you have a tip to offer others in the industry, please share that as well.”

Guest Post: Sarah Smith – legal assistant at Wolfe Law Group, LLC

It’s been seven years since devastating Hurricane Katrina destructed the City of New Orleans, and in that time the city has joined together to move forward in a positive direction to help rebuild the historical attraction. The pride and persistence of the residents have kept the city alive, and their determination has not gone unnoticed. FEMA has granted New Orleans $40 million to continue its transformation to a restored city. The grant has been allocated towards roadways in New Orleans and surrounding areas, New Orleans Museum of Art, LSPCA, Youth City Center, LSU Health Sciences Center, and LSU School of Dentistry. The bulk of the grant will go towards the Morris F.X. Jeff Municipal Auditorium in which significant damage to the electrical and mechanical systems, floors, walls, and seats will be repaired.  This city has proven to stay confident and resilient through difficult times, and such a grant will add to the city’s positive focus. If you would like to find more information about the breakdown of allocations, check out Nola.com’s article.

Eviction proceedings are ones that are considered summary proceedings here in Louisiana. These are ones that can be conducted much faster than an ordinary proceeding. See La C.C.P. art. 2591. Unfortunately this is not always the case and the Judge may use his discretion to retard the progress of the action.

Depending on the type of lease that Landlord and Tenant will determine how the lease may be terminated and eviction proceeding started. Termination of a lease is governed by La C.C.P. art. 4701 et seq. A helpful aspect for a Landlord to put into his lease, is that La C.C.P. art. 4701 notice is waived, therefore the Landlord will be able to institute eviction proceedings immediately upon default or termination of the lease.

The law has specific definitions for all the parties involved with a lease and eviction. These definitions are spelled out in the code at La C.C.P. art 4704. Terms such as Lease, Lessee, Lessor, Occupant, Owner and Premises are literally spelled out by the code. This is helpful to determine who the parties are.

If the Landlord is awarded possession of the premises by a court, and the tenant does not remove itself from the premises, then a Warrant will be issued to have the sheriff remove the tenant from the premises. This is a very serious penalty. See La C.C.P. arts 4731 and 4733 for more on this procedure.

Landlord / Tenant relationships can be very frictional at times. Most of the time the parties get along and there are not issues. In the small majority of the time where there are disputes, the lease will control. Further, the eviction proceeding is where the parties will have their day in court. I have dealt with a number of lease disputes here recently, and none are easy by the time they get to me. Its important to have a good working lease and take into account the rules to get the tenant out.

Since the state owns the land, there are no security devices, such as a lien that can attach to the land and call for its foreclosure in the event of default or non-payment. Therefore the state has come up with its own security device to give contractors and laborers a way to collect when not receiving payment.  Here we have the Louisiana coined term: Sworn Statement of Amount Due. La. R.S. §38:2242. This document needs to be filed by the subcontractor or laborer within 45 days of when the work was accepted by the government body overseeing the project. Id.

One way for a contractor who has a sub on any tier below it to cancel the Sworn Statement of Amount Due filed, is to “bond off” the lien. La R.S. §38:2242.2. This mechanism allows for the higher tier contractor to provide security or cash at an amount 125% of the total lien. Id. At this juncture the property will be clear but there will be evidence of the bonded off lien still held with the parish mortgage office. This is pretty common practice so that higher tier companies keep the bond free while settling disputes with subs.

If at the end of the 45 day window from the state agency signing off on full completion of the project there are still any claims remaining as unpaid, then the state, claimants, or contractors may file a concursus proceeding to have the funds distributed into the registry of the court so that the parties can fight about who deserves the funds. La R.S. §38:2243. Any party may file this action, and its a very powerful tool. This is why many of the contractors will use the mechanism to “bond off” the claims, so as to prevent this process.

Finally, every parties favorite section is where attorney fees are awarded. In the Public Works Act, by statute attorney fees are permissible. This gives all parties the confidence to fight thinking that they will recover the fees. Unfortunately, recovery of attorney fees is still a difficult chore even when there is a statute. Here, La R.S. §38:2246 allows for attorney fees to any claimant who timely and properly filed its claim and recovers the full amount of the claim asserted. The reason for the emphasis in the proceeding sentence, is due to the difficulty of getting exactly what you swore was due. Claimants should be as accurate as possible when asserting claims, otherwise this statute will not apply.

The above are just a few of the many nuances contained and embedded in the Louisiana Public Works Act. Each step of the process should be carefully traversed so that the contractor does not lose rights to collect if/when the general contractor or public entity runs out of funding.

The Louisiana Private Works Act codified in La. R.S. §9:4801 et seq., is the origin of the rules which govern construction liens for private projects in this state. The specific statue that allows for an individual to request a Court to order the Clerk of Court to cancel a lien is La. R.S. §9:4833. The statute reads in pertinent part:

If a statement of claim or privilege is improperly filed or if the claim or privilege preserved by the filing of a statement of claim or privilege is extinguished, an owner or other interested person may require the person who has filed a statement of the claim or privilege to give a written request for cancellation in the manner provided by law directing the recorder of mortgages to cancel the statement of claim or privilege from his records.” La. R.S. §9:4833(A).

The best part about this statute is that if all of the proper notice requirements are followed and the illegal lien is not removed from the mortgage records by other means than this Mandamus proceeding, the property owner who brings the Mandamus suit is entitled to attorney fees and costs. This is huge because, this type of proceeding can cost a homeowner thousands just in legal fees. Here at Wolfe Law Group, we charge a flat rate of $3,500 for this type of proceeding, which covers all things from notices, to the actual Mandamus suit, to the trial.

Liens can be very technical and there are many instances where the letter of the law is not followed. In those instances, an owner can have the lien removed and even against the will of the party who filed the lien. As a contractor, filing a lien is very important to preserve rights against parties it did not contract with who may be liable for payment. Here at Wolfe Law Group we file liens all the time, but if your are like most contractors, funds are short and hiring an attorney can be too costly. Companies like Zlien.com are excellent resources for all things related to liens. Fortunately for lawyers and unfortunately for services like Zlien.com, enforcement of a lien and/or a Mandamus suit for removal of an illegal lien can only be filed by an attorney (or individual if self represented). I recently posted a Petition for Mandamus recently drafted and filed by Wolfe Law Group on JDSupra.com.

Bottom line: owners should file suit to have illegal liens removed from the mortgage records. If not then selling or refinancing the property will be impossible with the cloudy title. If you file suit and receive a judgment then you will be entitled to attorney fees and costs, which are provided by statute.

The ordinance is best described by the City Council’s own publication:

“The Council adopted Ordinance Cal. No. 28,899, authored by Council Vice President Granderson that requires that contractors and subcontractors with city construction contracts of more than $50,000 report to the City Attorney any current company violations of federal, state and municipal laws that govern labor and employment. Specifically, the contractor is required to give notice to the City Attorney within 90 days of the issuance of any labor violation determination. If the contractor fails to correct the violation within a 90 day period the City Attorney will issue a written notice to the contractor and take enforcement action including civil remedies.”

There are many supporters and critics of the new ordinance. Many of the opponents say that it will just create needless paper work for contractors and will not solve the root cause of the problem. Although, supports say that since Katrina undocumented workers have been hurting union workers doing it by the book. The New Orleans City Business and NOLA.com both have their takes on the issue with good write ups. Overall this sounds like it will create more paper work for contractors and subject them to vague and ambiguous labor laws (where they are already subject to them anyway).

Having dealt with the City Attorney’s office in the past, this seems like it will simply be a bullet in its gun when going after small businesses. The city claims that if contractors are obeying the law they have nothing to worry about, unfortunately based on past client experiences, that is not likely the case. Just what the construction industry needs right now, another law.

Back in 2008, along with major sections of the U.S. economy, the U.S. housing market tanked. This was a terrible time for home builders and most contractors in the industry. There was a ripple effect that was felt industry wide. Signs of the the rebound have been few and far between. We are now one quarter deep into 2012 and there are a few positive signs that the end of the drought may be near.

Just last week CNN reported very good numbers for building permits nation wide. According to the article, new home building permits are up from month to month and a large amount from this time last year. There is also an increase in the number of new apartment / condo permits that are being requested nationwide. The article stated that major contractors and home suppliers are seeing increases in stock value and revenue stream.  Some sites like yahoo.com published a Reuters article stating that there is a “housing comeback.”

A wide range of cities nation wide are reporting similar findings, such as Portland, Oregon and Dayton, Ohio. If this trend keeps up there is a good chance that the housing market will rebound and home sales will start to improve.

There are many types of leases out there and it is very important to know the difference and to make sure that you have the power or at least have a fair shake. There are residential, commercial, industrial, green, month-to-month, oral, and a host of others. Just as in any legal contract, the devil is in the details.

I have clients who have disputes over 30 year commercial leases all the way down to those with month-to-month residential leases and the key to successfully getting what you want is to anticipate any issues when drafting the lease and before it is executed.

The Louisiana Civil Code has an entire section on leases which starts with article 2668. The State of Louisiana publishes this helpful brochure for parties to a lease.

There are a number of hot button topics contained in leases, such as notice clauses, termination clauses, lessor responsibilities, lessee responsibilities and duty clauses. If the lease is silent to such matters then the Civil Code will govern. This may or may not be favorable to your position.

I write this blog article because I see so many disputes out there when it comes to leases. As with all contracts (and medicine) an ounce of prevention is worth a pound of cure. If you get your documents reviewed before entering into them, you will be in a much better position if a dispute arises.

The most telling aspect of McCollam’s piece is how he sees, and how it is apparent to New Orleans residents, that the attitude and culture of business has changed. Hurricane Katrina helped to rid the city of the negative attitude and filled it with a group of forward thinking resilient entrepreneurs who want to make a difference, while at the same time making a dollar.

One of the more colorful excerpts from McCollam’s article addresses the problem with the former attitude of the city,

“We had found the root of the problem.” It’s a problem that New Orleans seems to have overcome in the years since Hurricane Katrina—so much so that Mr. Williamson can now afford a little levity.

Other positive organizations that are helping to aid in business growth and entrepreneurial spirit include the New Orleans Startup Fund. This all ties into constructionlawmonitor.com because, NOLA startup fund recently picked Zlien.com as one of its featured start up companies to help grow and become a successful New Orleans and nation-wide company. Zlien.com was founded by Wolfe Law Group founder, Scott G. Wolfe, Jr. Scott is the embodiment of the Wall Street Journal article and the national focus on our great city.

The winds of change are among us here in New Orleans and its a great time to live in this city. McCollum points out that Forbes and Inc.com have recently coined New Orleans as a harbor for business growth and young talent. Only time will tell how this will change this city, but it will be a fun ride nonetheless.

The infographic was inspired by awesome infographics used in other industries. The mechanics lien infographic visualizes the mechanics lien laws, and also presents some data from a survey Zlien conducted of mechanics lien claimants who filed liens in 2011.

Here it is: