Court of Federal Claims Holds that Contractor’s Defense of Defective Specifications Is Not an Independent Claim Requiring Submission Under Contract Disputes Act

Total Eng’g, Inc. v. United States, 2015 U.S. Claims LEXIS 30 (Fed. Cl. Jan. 26, 2015) 

The United States Army Corps of Engineers (the “Government”) awarded a contract to Total Engineering, Inc. (“Total”) for preliminary site construction work for the United States Army Medical Research Institute of Chemical Defense Replacement Facility.  When failures occurred in a steam line system that Total had installed, the contracting officer issued a cure notice and ultimately terminated Total for default.

Total’s contract required it to construct a steam line system, consisting of steam and condensate lines anchored to parallel concrete piers inside a concrete trench.  During a hydrostatic pressure test, the Government noted cracks in the piers, pipe detachment from several concrete piers, and damage to an anchor support.  The parties disputed the cause of the failures.  Total contended that the Government’s faulty design caused the failures, and the Government alleged that deficiencies in Total’s work were to blame. Continue reading “Court of Federal Claims Holds that Contractor’s Defense of Defective Specifications Is Not an Independent Claim Requiring Submission Under Contract Disputes Act”

Analysis: Prevailing Party In Jury Trial Finds Uncertainty In Remedies Available Under Pennsylvania Contractor And Subcontractor Payment Act

Richard W. Foltz, Jr.
Pepper Hamilton LLP, Partner

Jeffrey R. Mullen
Pepper Hamilton LLP, Associate

An amended version of this post was published in the March 16, 2015 AGC Construction Law in Brief, the weekly newsletter for the Associated General Contractors of America.

Since 1994, Pennsylvania law has provided enhanced remedies for prevailing in a payment dispute arising out of a construction project.  The prevailing party in a recent jury trial discovered uncertainty in the precise contours of those available remedies.  There was no clear precedent governing recovery of fees of a testifying expert, necessary to overcome the complex accounting and delay claims asserted by the defendant in response to the invoice dispute, and the method of calculating pre-judgment and post-judgment interest and penalty interest under the statute.  Because of the large sums at issue, the difference in calculation methods was significant.  Entitlement to these matters was unclear in spite of 20 years of precedent under the Pennsylvania Contractor and Subcontractor Payment Act.

Continue reading “Analysis: Prevailing Party In Jury Trial Finds Uncertainty In Remedies Available Under Pennsylvania Contractor And Subcontractor Payment Act”

New York Appellate Division Holds That Subcontractor’s Failure to Give Cure Notice Before Stopping Work Did Not Bar Recovery Because Contractor’s Prior Unjustified Failure to Make Three Successive Progress Payments Constituted Uncured, Material Breach

U.W. Marx, Inc. v. Koko Contracting, Inc., No. 518611, 2015 N.Y. App. Div. LEXIS 600 (N.Y. App. Div. Jan. 22, 2015)

The Appellate Division of the Supreme Court of New York affirmed judgment in favor of a subcontractor holding that although the subcontractor failed to comply with a contractual provision requiring it to give timely notice of its intent to stop work due to contractor’s failure to make payment, the contractor’s prior failure to make three consecutive progress payments to subcontractor constituted an uncured, material breach that relieved the subcontractor from performing its remaining obligations under the parties’ contract.

Continue reading “New York Appellate Division Holds That Subcontractor’s Failure to Give Cure Notice Before Stopping Work Did Not Bar Recovery Because Contractor’s Prior Unjustified Failure to Make Three Successive Progress Payments Constituted Uncured, Material Breach”