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On April 14, 2020, DNM Contracting, a general contractor in Houston, submitted an application for a Paycheck Protection Plan (PPP) loan with Wells Fargo. Two days later, with its loan not funded, DNM learned that all the funds for the PPP program had been exhausted.  Shortly afterwards, DNM filed suit against Wells Fargo, seeking class action certification, arguing that Wells Fargo violated the PPP regulations by not paying on a “first come, first serve basis” and by favoring larger borrowers. Since the case was filed, a series of procedural maneuvers have kept the parties from addressing

Are lost profits associated with local shelter-at-home orders recoverable under a property insurance policy? At least one court, the US District Court for the Western District of Texas, has ruled they are not. 1.    Non-Essential Businesses In Diesel Barbershop, LLC v. State Farm Lloyds, 2020 WL 4724305 (W.D. Tex., San Antonio Div.), several hair salons were forced to close due to their being categorized as non-exempt businesses under Bexar County’s Shelter-at-Home Order and as non-essential businesses under one of Governor Abbott’s Executive Orders.  Diesel and the other companies file

Your tenant is behind on rent due to COVID-19 related issues.  Can you evict the tenant?  That one question has profound ramifications for existing properties, projects under construction, and projects still in planning stage.  The inability to collect full rent or evict current tenants affects financial obligations, ROIs, and a myriad of other decisions, many of which present risks not just to owners, but developers, designers, contractors and subcontractors. The Centers for Disease Control and Prevention (“CDC”) just made both the answer to the question as it pertains to residential t

A recurring question in the design and construction industry is, what is the liability attached to site observation visits?  Most design professionals, construction managers, and owners’ representatives include language in their contracts that they are not responsible for contractors’ means and methods or for assuring safe practices.  But do those provisions really cut off liability?  Is the end result that, regardless of what language is included in contracts, the person performing the site observation visit retains some liability for a contractor using improper means or methods, or cr

What are your legal remedies when a contractor or subcontractor places an improper lien on property?  Under what circumstances is the contractor or subcontractor liable for $10,000 for filing such a lien?  The Texas mechanic’s lien statute, found in Chapter 53 of the Texas Property Code, provides some of the answers.  Among those answers is filing a motion to remove the lien, bonding around the lien, and seeking $10,000 and punitive damages for a fraudulent lien. 1.    Summary Motion The Texas mechanic’s lien statute, in particular Texas Property Code § 53.160, allows for a “summar

With an unemployment rate now below 8% and Tesla announcing the construction of a billion-dollar assembly facility in Austin, the City of Austin is climbing its way out of the deep trough left by the novel coronavirus.  Depending on your view of Austin politics (that topic alone would consume thousands of pages), to ensure that the trend lines continue in the right direction or to make the business climate in the City even more unfriendly, the City along with Travis County have recently extended the face covering requirements and gathering-size limitations until December 15, 2020. 1.     T

Can an employer require an employee to produce a negative COVID-19 test result as a condition to allowing the employee to return to work?  When do requirements enacted out of concern about the safety of your workplace violate federal law?  To unpeel this onion, we must first look at the Americans with Disabilities Act (“ADA”).  Adding this to understanding the state and local orders regarding face masks and social distancing will surely bring tears to your eyes. 1.     Americans with Disabilities Act Under the ADA, an employer may, in general, not require tests that would disclose me