11-27-15

12B — November 27 - December 10, 2015 — Owners, Developers & Managers — Design/ Build | Construction Management— M id A tlantic

Real Estate Journal www.marejournal.com

D esign / B uild | C onstruction M anagement By Brian M. Rader, Esq., Jardim, Meisner & Susser, P.C. Project Management 101: Understanding your exposure to liability

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of services. On the other hand, to de- termine whether an employ- er-employee relationship exists, one must consider factors such as (1) whether the hiring party maintains extensive control over the contractor; (2) provides supplies and instrumentalities; (3) the length of the project; (4) method of payment; and (5) intent of the parties. If an employer-employee rela- tionship is found to exist, the hiring party may be vicari-

ously liable for the negligent acts of the employee under theories of agency, or torts such as negligent hiring. However, a hiring party must recognize that there are exceptions to the general rule that a hiring party is not responsible for the negli- gent acts of the independent contractor. Specifically, New Jersey courts have imposed three exceptions: (1) where the landowner retains control of the manner and means of doing the work under the contract;

(2) where the landowner engages an incompetent contractor; and (3) where the activity con- stitutes a nuisance per se. Under the first exception, a hiring party may be liable for the negligent performance of an independent contractor if the hiring party exercises control over equipment, the manner/method of doing the work, or direction of the em- ployees of the independent contractor. Basic supervi- sory acts will generally not give rise to vicarious liability under this exception. Under the second excep- tion, a hiring party may be liable for the negligent performance of an indepen- dent contractor if the hiring party engages an incompe- tent contractor. Under this exception, a plaintiff must establish that the hiring party knew or should have known of the independent contractor’s incompetence. No presumption as to the negligence of the hiring par- ty in engaging the contractor arises from the fact that, after being hired, the con- tractor was negligent in the performance of duties. Under the third exception, a hiring party may be liable for the negligent performance of an independent contractor if the hiring party engages an independent contractor to perform duties that are a “nuisance per se” which can be equated with “inherently dangerous.” The danger must inhere in the activity itself, be peculiar, and require spe- cial precautions to avoid injury, or involve grave risk of danger if negligently done. In conclusion, a hiring par- ty is best served to clearly delineate the relationship of the parties prior to the com- mencement of the project, and to avoid unintended exposure to liability, adhere to the standards which define the respective relationship. Lastly, a prudent hiring party should conduct due diligence prior to hiring a contractor; namely, by con- ducting reference checks, and investigating prior work the contractor has performed on similar projects. Brian M. Rader, Esq. Jardim is a partner at the law firm of Jardim, Meisner & Susser, P.C. n

anaging any proj- ect requires the engagement of con-

Generally, one who hires an independent contractor has no right of control over the manner in which the work is to be done. Conse- quently, it is the indepen- dent contractor, rather than the hiring party, that is the proper party to be charged with the responsibility for preventing the risk, and ad- ministering and distributing it. As a result, the general rule is that a hiring party is not liable for the negligent acts of the independent con- tractor in the performance

tractors that will perform services on b e h a l f o f the hiring party. The distinction between an e mp l o y e e and i nde -

Brian M. Rader

pendent contractor is a cru- cial one, and will generally define the hiring party’s ex- posure to liability.

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