02/05/2020

Editor’s Notes

Construction contracting is replete with deadlines for seeking compensation. Whether it’s making a demand against a project owner, perfecting a mechanic’s lien, or asserting a claim against a payment bond, there is almost certainly a time limitation. The deadline may be contractual or it may be statutory. Failure to comply will probably be fatal to the claim. Contractors must be vigilant in preserving their rights. Those who fail to do so will be left grasping at straws.

 

A recent case out of the state of Washington involved an unpaid subcontractor’s claim against a public works bond. The claim was asserted 34 days after a municipal project owner’s formal acceptance of the project. The bond statute allowed 30 days. The sub was forced to argue that the bond claim period had been extended by the owner’s administrative contract closure process or the prime contractor’s performance of corrective warranty work at the site. These arguments failed.

 

The other case in this issue addresses a school board’s refusal to accept a low bid on a contract. The bidder had reused certain forms from a recent bid solicitation. A New Jersey court ruled that the bid defect was inconsequential and did not provide the low bidder with a competitive advantage. It had been improper to announce award of the contract to another bidder at an additional cost of $189,000.

 
 
 
 
 

 

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