A contractor's past experience is a valuable asset. Public construction procurement frequently requires experience with certain work in order to be a "technically acceptable" competitor for a contract. Private project owners also value past experience and do not rely on low price alone when awarding contracts.
The importance of past experience raises a question: Can experience be gained through the work of one's subcontractors or must the construction work be self-performed? A recent decision answered this question in the federal construction arena.
Unless a bid solicitation contains language to the contrary, a contractor is entitled to take credit for prior work performed by subcontractors. There is no inherent requirement that the work was self-performed. The reasoning is that a prime contractor is responsible for the sufficiency of the work of its subcontractors.
The other case in this issue involved the right of a non-party to a contract to invoke the arbitration clause in that contract. A non-party may invoke the clause only when the allegations involve rights and duties created under that contract. Where the allegations were based in common law and state statute, not contract, the non-party could not invoke the arbitration clause.
