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North Carolina General Legal Blog

Two different ways to structure energy contracts, and the importance of experienced legal counsel

Last time, we began looking at a state bill that would rework the regulatory scheme governing the bidding and negotiation of renewable energy projects. As we noted, the bill would put Duke Energy in charge of the bidding process for these projects, which is a cause of concern to private energy developers, who have been increasingly shut out by the utility.

Contract negotiation is an important aspect of doing business in any industry, including the energy industry. Generally speaking, energy contracts are of two different types: fixed procurement and flexible procurement. Fixed procurement contracts are those in which energy companies agree on a price for gas or electricity, and fix that price for the duration of the contract. Usually, the contract length is one to three years, but this can vary. 

Renewable energy developers oppose bill reworking regulation of project bidding process

Clean energy is a growing and competitive industry, and regulating of the industry requires careful balancing of multiple factors. Among these factors is the need to protect consumers, as well as the need to encourage growth and innovation.

The current regulatory scheme involves various requirements under the Public Utility Regulatory Policies Act, a federal law passed in 1978 to help encourage energy conservation and to promote renewable energy development. Among other things, the law established a free energy market for non-utility energy developers, and several requirements to protect them in the bidding process. In the decades since it has passed, PURPA has grown less important, but non-utility renewable energy developers still find it useful since it exempts them from regulatory requirements at both the state and federal level. 

Toxic mold is a growing concern in rental units

It may have started as a scratchy throat, but as you grew sicker, you feared it was something more serious. When you realized the symptoms began soon after you moved into your new rental unit, the pieces began to fall into place.

Perhaps you purchased a toxic mold kit from the hardware store or called a professional for an evaluation, and the results likely frightened you. The house or apartment you are renting contains potentially deadly toxic mold, and it is making you ill.

Consult an experienced attorney to protect your rights as a tenant

Last time, we looked briefly at some of the troubles student-tenants can face with rental housing. As we noted, these problems are often made worse because of opportunistic landlords who take advantage of their young tenants’ ignorance. The reality is that tenants, whether they are students or not, need to understand their rights as renters, or their landlords will have an easier time taking advantage of them.

North Carolina law is fairly specific about the duties landlords owe their tenants, as we as the legal remedies available to tenants when landlords fail to comply with the law. These include the duty to: keep common areas and facilities in safe condition; to comply with local building and housing code regulations; and to keep property in a fit and habitable condition.

Landlord-tenant attorneys: students particularly vulnerable to landlord negligence

When it comes to landlord-tenant problems, some tenants are more at risk than others. This includes low-income tenants, disabled and elderly tenants, and also student tenants. According to a recent article, University of North Carolina students living in the Chapel Hill neighborhood are particularly prone to encountering rental issues, including burglary, gas and water leaks, out-of-repair flooring, vermin infestations, unjustified loss of security deposits, and other issues.

There are a variety of reasons it is common for students to deal with landlord-tenant disputes. The high price of housing, the age/dilapidation of the units, and the fact that owners often have minimal contact with their tenants are a few reasons. In some cases, students are unable to get the landlord’s help because they themselves are not in compliance with local occupancy rules and are afraid to get in trouble. 

Looking at some strategies for allocating risk in construction contracts, P.2

Last time, we began looking at some of the strategies that can be used to allocate risk in construction contracts, and the importance of working with an experienced attorney to negotiate risk allocation in the formation of construction contracts. Last time, we mentioned warranties and representations, as well as payment terms and conditions, as potential ways to allocate risk.

Indemnification is another potentially important way to allocate risk. An obligation to indemnify means that a party is legally required to compensate another party for a specific loss. In construction contracts, indemnity can be used to compensate a party for risks it didn’t assume or for expenses that can’t otherwise be recovered, for minimizing the likelihood of litigation, or for shifting the cost of defending third-party claims. 

Is your real estate license in real danger?

Professional licensing in any field establishes a level of trust with the consumer. It says you have successfully completed your training and that the industry has carefully vetted you for trustworthiness and upstanding character. Some businesses, like real estate, don't even allow you to practice their trade without a license, which you may even have to renew periodically following further training.

Real estate licensing provides a standard of excellence on which the public relies when making a major transaction like selling or buying property. This is why real estate licensing commissions give serious consideration to complaints against licensees or reports of misconduct. In fact, some behaviors may place your status as a licensed real estate agent in jeopardy.

Looking at some strategies for allocating risk in construction contracts, P.1

For both property owners/developers and contractors, careful negotiation of construction contracts is important to ensure a party’s rights and interests are protected. One important aspect of construction contract negotiation that should always be thoroughly explored is risk allocation.

Risk allocation refers to the shifting and balance of risk between parties to a contract. There are a variety of tools and strategies that can be used to shift risk in commercial contracts, and it is important for parties to a construction project to consider the ways in which they are exposed to risk and to negotiate measures to minimize that risk. 

Work with experienced legal counsel to protect your construction contract termination rights

In our last post, we began looking at a dispute between the State of North Carolina and a contractor who agreed to head up the construction of a psychiatric hospital in Morganton. As we noted, the contractor is bracing for the possibility that the Department of Health and Human Services will cancel the contract, and has said that it will plan to sue for wrongful termination if the contract is terminated.

Termination of a construction contract, which means to stop the full performance or completion of the terms of the contract, is not something a party can always do without fear of penalty. Well-drafted construction contracts always specify the conditions under which the contract may be terminated and the consequences of termination in each case. 

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