While the housing industry appears to be on the rebound, contractors are now faced with a number of challenges in trying to meet the recent increase in work. One of the biggest challenges relates to significant price increases in building materials and products. Of course, unanticipated price increases will affect the bottom line in most construction projects. One way to address this risk at the beginning of the project is to include an escalation clause in the construction contract. This allows parties to adjust the contract price if the costs of building materials and products incorporated into the project exceed a set amount. Even after the market stabilizes and the price of construction materials is more predictable, external forces such as labor strikes, natural disasters, and trade restrictions can still cause significant losses. Contractors should be aware of these risks, and take the necessary steps to protect against or limit the risks or price hikes by including escalation clauses in their contract negotiations.
Associate Dorothy Bean, an attorney in Saalfeld Griggs’ Construction Industry Practice Group, was honored as the Future Leader of the Year for 2012-2013 by the Salem Chapter of the National Association of Women in Construction (“NAWIC”), a national nonprofit organization that promotes and supports the advancement and employment of women in all aspects of the construction industry. The Future Leader of the Year Award recognizes an individual who has made significant contributions to the Salem NAWIC chapter in the past year, and who has taken on a leadership role within the organization. Dorothy is on the Board of Directors for NAWIC, and serves on a number of NAWIC committees, including the Legislative Affairs Committee, and the Scholarship Committee. Dorothy also stays involved in the construction community by serving on the Board of Directors for Habitat for Humanity of the Mid-Willamette Valley. More information about NAWIC, and about the role of women in the construction industry, can be found here.
Saalfeld Griggs’ Dental Industry Team has posted a selection of white papers for use by dental professionals in managing the legal aspects of their practices. They can be found on the Dental Industry Team page, or by clicking here.
On February 28, 2013, the Washington Supreme Court issued its decision in Klem v. Washington Mutual Bank, et.al., holding the practices of the WaMu and Quality Loan Service Corporation of Washington (“Quality”) violated the Consumer Protection Act (CPA). Quality had trained its employees to falsify the execution dates of foreclosure documents with the apparent purpose of expediting the foreclosure process. Additionally, WaMu and Quality had entered into an agreement that provided Quality was not to authorize postponements of the foreclosure sales without prior authorization of WaMu or its agents. In practice, Quality refused to consider requests for delaying foreclosure sales and referred such requests to WaMu.
Persons asserting a claim under the CPA must meet several elements, but the primary issue in many cases is whether the practices or acts of the defendant are “unfair or deceptive.” The legislature can and does expressly state that violations of certain statutes are also unfair or deceptive acts or practices such that a person injured may assert a statutory violation creates a claim under the CPA. In Klem, the Supreme Court held violations of the state’s notary laws and, more surprisingly, an agreement by the trustee to act as the agent of the beneficiary constituted unfair or deceptive acts or practices as a matter of law.
In a judicial foreclosure proceeding, the trial court is charged with the responsibility of being an impartial arbitrator of the law. In non-judicial foreclosure proceedings, the trustee has the obligation to impartially apply the law. In 1975, the Washington legislature removed the prohibition of agents acting as trustees. The Court in Klem refused to interpret such act as an implicit authorization. Therefore, lenders who have an agency relationship or similar relationship with the trustee run a substantial risk of violating the CPA.
In light of the Klem decision, Lenders must evaluate whether they currently have an agency relationship or similar relationship with their trustee and review all agreements with their trustees to ensure they do not obligate the trustee to act in an impartial manner. Further, Lenders must ensure the practices and communications of their officers do not evidence a tacit agreement between the Lender and the trustee. Finally, Lenders should consider what due diligence and oversight of their trustees are currently implemented.
On January 29, 2013, Jennifer Paul, an assoicate attorney in Saalfeld Griggs’ Employment and Litigation groups, was named the 2012-2013 National Catholic Educational Association (NCEA) Distinguished Graduate for Queen of Peace Elementary School. The NCEA Distinguished Graduate Award recognizes an alumni member who has made a significant contribution to his or her community. Jennifer graduated from Queen of Peace Elementary in 1997. Jennifer was honored for her volunteer work, including her involvement with Catholic Community Services, the Boys and Girls Club, and Mothers Against Drunk Driving (MADD). Jennifer is also the honorary chair for Queen of Peace School’s 2013 Campaign for Excellence.
Saalfeld Griggs has been named LEGUS Member of the Month. LEGUS is a network of small to mid-size law firms that reflects a vibrant range of work and client referrals between member firms.
The Oregon Legislature is back in session and the shift in balance of power makes it likely that laws imposing additional obligations on employers will gain traction in this year’s session. The Saalfeld Griggs Employment Law Team is tracking employment-related legislation and sending out monthly updates with status reports and analysis of possible impact. If you want to have your voice heard on proposed legislation, we are also helping to get the word out about upcoming hearings and letter writing campaigns regarding bills of concern. If you would like to be included on our email distribution list, please email Randall Sutton at email@example.com.
On January 29th, Erich Paetsch and Shannon Martinez, lawyers in the Creditors’ Rights & Bankruptcy Practice Group, will make a presentation to the Oregon Banking Association Lending Committee entitled “What’s in a Name? Transitioning to Perfection Under The UCC.” The presentation will cover the 2013 changes to the Uniform Commercial Code (UCC) and other hot topics in commercial lending.
Although the so-called “fiscal cliff” was averted, certain payroll tax changes took effect on January 1, 2013. Employers should be aware of the following changes to Social Security and Medicare tax withholdings for wages earned in this new year:
1. Social Security – In 2013, the Social Security wage base increased to $113,700. Furthermore, on December 31, 2012 the Social Security payroll tax cut expired. In 2011 and 2012 this payroll tax cut reduced employee-paid Social Security taxes by 2% to 4.2%. In 2013, the Social Security withholding rate for both employees and employers will revert back to 6.2% of wages under the Social Security wage base.
2. Medicare – The base Medicare tax rate remained unchanged for 2013 at 1.45%. However, starting January 1, 2013, additional Medicare taxes of 0.9% will apply to wages paid in excess of $200,000. Employers will not pay this tax but will be required to withhold it from wages paid over $200,000.
We would like to wish our clients, friends, and colleagues a very happy holiday season. Best wishes for a peaceful and prosperous new year!