Construction Remedies: Replevin Actions vs. Liquidated Damages

Description

Construction defaults often require specific remedies. When subcontractors and suppliers are part of a significant project, there are times when a terminated downline removes materials that have been paid for by the owners. In many cases, the owner and general contractor would sue for monetary damages and order new supplies. However, in the current economic climate with catastrophic delays in the supply chain or in cases where the materials were custom manufactured overseas and not easily replaceable, construction counsel must consider all options, including filing a replevin action against the subcontractor.

In its simplest terms, replevin is a procedure whereby seized goods may be provisionally restored to their owner pending the outcome of an action to determine the rights of the parties concerned. The requirements of a replevin action differ by jurisdiction.

When filing a replevin, the plaintiff must consider the appropriate jurisdiction to file, as it is best to file where the improperly seized materials are being held, if that is known. The process in each jurisdiction varies, but replevin requires strict statutory adherence.

When time is of the essence, or there is a concern that the removed materials will be harmed or destroyed by the holding party, most jurisdictions allow the sheriff to seize the property under a writ of seizure. In general, a writ of seizure is issued upon an order of the court entered upon notice and a hearing during which the moving party must establish through the complaint, affidavits, testimony, admissions, or other evidence, that it has a high probability of successfully demonstrating its claim to possession of the subject materials.

In addition to the equitable relief that replevin provides unless the contract explicitly states otherwise, other damages are likely available, including liquidated damages. Replevin offers an option that reduces costs and court time, allowing construction projects to remain on track and serving as another tool for counsel to seek relief.

Listen as our expert panel discusses the process of replevin, how it can save time and costs for clients, and when it is best utilized as a remedy in a construction default.