Construction Counsel

Design-Builders

• Firm Guides Design-Builder in $35M Auto Manufacturing Facility
  Faced with a $6.8 million payment dispute and a cybersecurity theft on a critical $35 million automobile manufacturing facility project, our design-build client turned to us for help. The project, involving design and construction of a line for a major automobile manufacturer, was nearing completion, but the outstanding payment threatened our client and its relationships with key subconsultants. The cybersecurity incident added a layer of complexity, requiring careful navigation. We secured our client’s interest by recording an approximately $6.8 million mechanics lien claim and by pursuing many legal remedies, including litigation against the project owner and its sureties, never losing sight of the value of preserving our client’s key business relationships and its desire for early, cost-efficient dispute resolution. We engaged in mediation and direct negotiation with the key stakeholders, fostering a collaborative approach to problem-solving, while our client completed the project. This approach, combining decisive action with a commitment to amicable resolution, resulted in a win-win outcome. The modern system achieved completion, it passed the owner’s acceptance testing, was put into operation – and its designers and builders were compensated for their work. Our client’s key relationships with the project owner and its specialty subconsultants were preserved for collaboration on future projects in this tight-knit industry. 
• Firm Wins Landmark Lawsuit Limiting Mechanics Lien SubordinationOur client, a design-build firm, faced a significant challenge when a construction lender tried to extinguish its mechanics lien on a Chicago high-rise project. The lender argued a subordination agreement, signed at the project’s outset, eliminated our client’s lien rights. This tactic, once commonplace, was directly addressed by amendments to the Illinois Mechanics Lien Act in 2014, passed after the seminal Cypress Creek decision. These amendments sought to protect designers and builders from being compelled to waive their lien rights as a condition of project financing. Our client’s case presented the first known judicial test of these important revisions. We vigorously contested the lender’s motion to dismiss, arguing that the subordination agreement violated the amended Lien Act by requiring our client to surrender its lien rights before 50% of the loan had been disbursed. This was the very type of practice the legislature intended to prevent. Our team successfully showed that the lender’s interpretation of the mechanics lien Act would effectively nullify the 2014 amendments. The court agreed with our analysis, denying the lender’s motion to dismiss our client’s mechanics lien claim with prejudice, cinching the priority of our client’s mechanics lien over the lender’s mortgage lien. This landmark victory protected our client and affirms the strength of the 2014 amendments to the Mechanics Lien Act, safeguarding the rights of lien claimants throughout Illinois.