Volume: 21, Issue: 10 - 05/31/2023


A solicitation for bids on a public construction contract is expected to inform bidders of the requirements for a complete, responsive bid. It is the bidder’s obligation to comply or risk rejection of its bid. But does the project owner have a duty to administer the bidding process in a manner that keeps a bidder apprised of the status of its bid?


A low bidder on a state contract complained that the project owner failed to promptly notify it of an omitted document that arguably rendered the bid nonresponsive. The owner had remained silent until expiration of the bid protest period, and the bidder contended this had been a violation of procedural due process. Did the public project owner owe the bidder such a duty?


The second case in this issue involved a federal agency’s attempt to divide a contractor’s delay claim into seven pieces. The agency argued that each of its directives, requests or responses had been a distinct delay event that had to be separately priced and certified.


A public project owner did not violate a bidder’s due process rights when the owner waited until after expiration of the bid protest period to inform the bidder its bid was nonresponsive. The bidder had no entitlement to notification, and the owner ultimately addressed the protest on its merits.


Individual government directives, denials or responses were not distinct delay events that had to be separately priced and certified. They were all part of a common set of operative facts relating to project delay.

Volume: 21, Issue: 9 - 05/15/2023


Construction contracts commonly call for advance written, signed change orders to authorize additional or changed work, but the realities of a bustling, fluid construction site get in the way. Even with reasonable project management by owner and contractor, this is a difficult standard to meet. Case law consistently holds written change order requirements enforceable. Yet the doctrine of “waiver” is always in play.


An Ohio court recently addressed this situation. Ohio has rock-solid judicial support for the enforceability of written change order requirements, yet even Ohio precedent has on occasion recognized the possibility of waiver. On the project in question, a lower-level owner administrator without contractual authority had consistently sent the contractor emails regarding changed work while implying the authorized individual was in the informational loop.


The second case in this issue addressed the question of when the payment period under a state Prompt Payment Act started to run. Did it start when the contractor’s payment application was received by the project architect in accordance with the contractual procedure? Or did it not start to run until the owner received the application, certified for payment, from the architect?


The third case involves certification of claims under the federal Contract Disputes Act. When a claim is certified in a defective manner, can the certification be corrected even though the statutory time limitation for submission of claims has expired?


A change order clause requiring advance written, signed orders would generally be enforceable against the contractor; however, it was possible the project owner waived the requirement through a pattern of email authorization by a lower-level manager.


A statutory 21-day prompt payment period started to run when the project owner’s designated architect received a contractor payment application, not when the owner itself received the application. The fact the architect had not yet certified the application for payment did not make the application “disputed.”


If a contractor amended its defective claim certification language after expiration of the statutory claim limitation period, the contractor could still correct the certification and proceed with the claim.

Volume: 21, Issue: 8 - 05/04/2023


Courts favor the enforcement of arbitration clauses as this binding form of alternative dispute resolution is beneficial to judicial economy and efficiency. Courts are willing to review the validity of the arbitration clause itself, but are reluctant to allow collateral attacks based on other provisions of the contract.


A recent case from Rhode Island is an example. Subcontractors argued that a “pay-if-paid” clause in the subcontracts violated state law and was void. The subs contended this voided the subcontracts in their entirety, including the arbitration clause. The Supreme Court of Rhode Island, however, ruled in favor of arbitration. The arbitrators could determine the enforceability of the pay-if-paid clause.


The other case in this issue involves what the Court of Federal Claims described as “a fundamental conflict” between best procurement practices and congressional favoritism toward small businesses. Could agency requirements for contract eligibility be superseded by the Small Business Administration?


Where defendants challenged the enforceability of pay-if-paid clauses in subcontracts, but did not challenge the arbitration clause incorporated into the subcontracts, the question of the enforceability of the pay-if-paid clauses had to be referred to arbitration.


The Small Business Administration Certificate of Competency process takes precedence over any special experience requirements stipulated in a contract solicitation. The Court of Federal Claims has no jurisdiction to review an SBA grant of a COC.

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