Public Construction

Public Improvement Construction

Public improvement construction– that is, projects being done for the federal, state, or local government or an agency thereof–are subject to many laws which are different from ones applicable to residential or commercial construction. Mr. Bergmann is well-versed in this area of law, having represented prime contractors, subcontractors, and  material suppliers on many such projects.

One major area in which the laws pertaining to public improvement projects differs from residential or commercial construction is how one goes about getting paid by the delinquent general or principal contractor.

Under Ohio law, when a subcontractor, materials supplier, or laborer is not paid for work and/or materials furnished on a residential or commercial construction project, that party may take steps to impose a mechanic’s lien against the improved property and use the lien in legal proceedings to obtain payment. However, state law does not afford that mechanism to the subcontractor, material supplier, or laborer who has provided services and/or materials on a public improvement project.  Fortunately, there are alternative ways by which such persons may obtain payment.

In Ohio, the government entity for whom the public improvement project is being done must segregate and hold the project funds until they are due to be paid. An unpaid subcontractor, material supplier, or laborer may impose a lien against the undisbursed public funds–called a “public improvement fund lien”–and then “foreclose” on that lien in order to obtain payment.

Also, Ohio and federal law requires that, on every public construction contract, the principal contractor must provide the public authority with a payment bond ensuring that subcontractors, suppliers, and laborers will be paid for services rendered and materials furnished for the project. If any such parties are not timely paid, they may may make a claim against the bond for payment by the company issuing the bond. Should payment still not be forthcoming, they may obtain payment through litigation against both the principal contract and the bond company.

However, if a subcontractor, supplier, or laborer fails to strictly follow the lien or bond claim procedures, it will lose its ability to use those means of obtaining payment. To avoid that consequence, a subcontractor, supplier, or laborer would be well-served to obtain the assistance of an attorney knowledgeable in this area of law.

LEGAL SERVICES WHICH THE FIRM OFFERS INCLUDE:

  • Consultation regarding project-related issues.
  • Negotiation, preparation, and/or review and revision of project-related contracts and other transaction documents.
  • Assertion and enforcement of public improvement fund liens;
  • Assertion and enforcement of payment bond claims;
  • Representation in the negotiation and settlement, arbitration, or litigation of project-related claims and disputes.

Many of those legal services–such as a consultation, the preparation of a construction contract, or preparation of a public improvement fund lien–may be done for a flat fee. However, services which may involve an uncertain amount of time (such as contract negotiations and litigation representation) are ordinarily rendered for an hourly fee.

All of the construction-related services which the firm offers are not stated in this brief overview of the firm’s services. If you need a particular service which you do not see, please feel free to contact us to inquire as to whether the firm offers it.