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ConstructionPro Week, Volume: Construction Advisor Today - Issue: 83 - 11/24/2010

Intentional Misconduct By Owner Representatives

Bruce Jervis, Editor

Construction Claims Advisor

 

Project owners use independent representatives for a wide variety of services during the construction process. When administering the project, the representative’s primary obligation is to its client, the project owner. If the project owner is a public entity, the representative is cloaked with a degree of immunity when exercising its independent business judgment on behalf of the owner. But this does not mean the representative has no obligation whatsoever to bidders or contractors.

 

 

In a recent Michigan case, a low bidder on a public project alleged that the owner’s architect had the bidder improperly disqualified as not responsible. There was a long history of friction and animosity between the individual architect and the contractor. The contractor introduced an affidavit stating that the architect had misrepresented comments by the contractor’s references regarding past performance history. And there was an email from the architect which could be read as an intention to retaliate against the contractor.

 

A trial court granted summary judgment in favor of the architect, saying it was simply an exercise of professional business judgment. But an appeals court allowed the bidder to proceed with the suit, based on the contractor’s evidence of intentional misconduct.

 

How do you feel? At what point does the exercise of independent business judgment on behalf of the project owner become interference with the valid business expectancies of bidders and contractors? I invite your comments.

Featured in next week's issue of Construction Claims Advisor:

 

  • Constructor and Construction Lender Formed Joint Venture
  • State Bid Form and Local Instructions Create Confusion
  • Chart Stated Sum Certain for Federal Claims Purposes

 

Bruce Jervis, Editor
Construction Claims Advisor

 

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