New York Court Holds Contractor’s Failure to Timely Pass Through Subcontractor Delay Claim to the Owner Constitutes Breach of the Covenant of Good Faith and Fair Dealing

Rad and D’Aprile, Inc. v. Arnell Construction Corp, No. 502464/14, 2019 BL 131606 (NY. Sup. Ct. April 3, 2019)

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Kristopher Berr

In June of 2001, Arnell Construction Corp. (“Arnell”) entered into a prime contract to build two sanitation garages in Brooklyn for the New York City Department of Sanitation (the “City”).  Arnell subcontracted the project’s masonry work to Rad and D’Aprile, Inc. (“Rad”).  After execution of the subcontract, Rad was informed that the start of work would be delayed because the City had not yet obtained ownership or access to all portions of the site.  When its work did commence, only limited portions of the site were available.  This caused inefficiencies in Rad’s work and caused it to incur increased costs.

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Federal Court Holds That Under Louisiana Law, Actual Notice of Cause of Delay Satisfies Contractual Notice Requirement Despite Failure to Strictly Comply With the Notice Provision

Parkcrest Builders, LLC v. Hous. Auth. of New Orleans, 2017 U.S. Dist. LEXIS 125012 (E.D. La. August 8, 2017)

The Housing Authority of New Orleans (“the Authority”) contracted with Parkcrest Builders, LLC (“Parkcrest”) to construct a public housing project.  The Project was delayed and the Authority terminated Parkcrest prior to completion, and entered into a Takeover Agreement with Parkcrest’s Surety.  The Surety retained Parkcrest to complete the work, and later notified the Authority that it had achieved substantial completion.  The Authority asserted deficient and incomplete items remained on the project, which the Surety refused to complete.  The Authority then solicited bids for the remaining work, and awarded the work to a replacement contractor.

Parkcrest sued the Authority for breach of contract and also asserted that any delays on the Project were excusable and, therefore, not subject to liquidated damages.  The Authority counterclaimed against Parkcrest for added costs to complete the project.  The Surety intervened, also seeking a ruling that all delays were excusable.  The Authority then counterclaimed against the Surety for completion costs. Continue reading “Federal Court Holds That Under Louisiana Law, Actual Notice of Cause of Delay Satisfies Contractual Notice Requirement Despite Failure to Strictly Comply With the Notice Provision”