EDITOR'S NOTES | Issue 7-17
publication date: Apr 27, 2009
With corporate bailouts, stimulus packages, an $11 trillion national debt and the recent income tax filing deadline, it is no surprise that taxes and government spending are on the minds of many Americans. Where has the money gone? Who is accountable? Is there accountability? Since tax dollars fund the vast majority of public projects (and now many private ventures), spending transparency is crucial to fiscal responsibility. If a municipality does not follow its own contracting statutes, jilted contractors and government watchdogs will be sure to notice. This week’s first case offers a prime example. When a public owner made an exception to its own bidding law when it awarded a contract, a competing bidder filed a complaint that ultimately resulted in an award for bid preparation costs. The court noted that awarding lost profits to the unsuccessful bidder would be too much of a burden on the taxpayer.
Transparency isn’t exclusive to public contracting. Open communication between owners, prime contractors and their subs is a key component to any project’s success. In the second case, an oversight in a subcontractor’s insurance policy left a prime contractor exposed to defend itself in a wrongful death suit.
And finally, it pays to read the fine print. When two parties entered mediation to settle a change order claim, the filing party did not realize it was waiving its rights to pursue all other claims.
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