Puerto Rican construction law: Yes, it is unique (and worthy of a specialized blog)

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Peurto Rico construction law blog
Supreme Court of Peurto Rico -- Peurto Rican law has unique qualities.
Supreme Court of Puerto Rico — Puerto Rican law has unique qualities.

Francisco J. Matta Bermúdez‘s Construction Law Depot blog provides an intriguing mix of general observations and Puerto Rico-specific construction law.  I suppose the general content (often reposted from elsewhere) might be of greatest interest to non-Puerto Ricans, but I find this blog’s greatest value probably resides closer to his island home.

Consider, for example, this posting: Can an architect file a claim under a payment bond? The writer cites Puerto Rican law explaining its provisions to protect subcontractors and suppliers and suppliers and how sureties protect owners from defaults within the supply chain. In some cases, an owner may pay for services, but if an intermediary such as a general contractor fails to pay suppliers or trades, they retain a claim against the owner — an obviously serious risk, that can be covered by the payment bond. But what about an architect? Can the the designer claim against the bond.

But what about the architects? Can they claim to the owner? Yes. To the surety? Not necessarily.

In Empresas Capote, Inc. v Tribunal Superior, Sala de San Juan, 103 D.P.R. 765 (1975), the court determined that the architecture profession falls “within the broad scope of the services and work contract” and hence its services“susceptible, as in this case, to be performed within a fixed-price service contract, thus benefitting from the direct action against the project owner as recognized in Article 1489 and our current case law.”

It should be noted that, in Capote, the architect claiming under Article 1489 was hired by the designing architect (a.k.a. architect of record) under a fixed-price contract for design services.  Different to most public construction contracts which require a payment and performance bond by law, payment bonds are rarely ever required for design contracts. In fact, I have never come across one, although it is certainly possible. Needless to say, theCapote ruling only established the inclusion of the architect as one of the laborers within the scope of Article 1489, nothing was determined regarding a payment bond, since none was furnished under the contract at hand.

However, there is no reason, that the Capote ruling cannot be applied to a bonded construction contract. As a valid claimant under Article 1489, an architect should be able to file and successfully recover a proper and timely claim under the payment bond,provided his services were part of the scope of a bonded contract. This is were it might get tricky.

I’ll let you read the rest of this blog posting for more insights here.

Obviously, you wouldn’t want to apply specific Puerto Rican legal interpretations to your business elsewhere, but if the blog’s purpose is to introduce or support client development, then it serves its purpose. I mean, if you are contemplating doing business in Puerto Rico, probably you would want to work with a lawyer familiar with the local conditions and rules, and here Francisco J. Matta Bermúdez obviously has insights of real value.

Voting continues for the 2014 Best Construction Blog competition through to March 31. You can vote here.

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