Volume 3 - Number 9 | February 28, 2005 - Construction Claims Advisor

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You are here: Home » Volume 3 - Number 9 | February 28, 2005

Volume 3 - Number 9 | February 28, 2005

EDITOR'S NOTES | Issue 3-9: This week's Advisor covers a false claims act suit alleging fraud in a low bid, a bond claim in which neither party clarified whether the project was a federal or state contract, a default termination for failure to comply with contractual safety and health requirements, and two interim motions on a major federal courthouse claim involving delayed shop drawing approvals and missing CPM schedule updates.

JUDGE TOSSES SUIT THAT $168 MILLION CONTRACT WAS BID LOW IN ORDER TO PURSUE CHANGE ORDERS: A false claims act action was dismissed where it was alleged a $168 million low bid was deliberately undervalued to fraudulently induce the Corps of Engineers to award a contract with the intention of later obtaining contract increases through change orders.

APPEALS COURT REMANDS CASE TO DETERMINE IF PROJECT IS GOVERNED BY MILLER ACT: In a dispute over costs for disposal of contaminated material, the excavating subcontractor was awarded $56,000 in damages plus interests, costs and mediation sanctions, but the general contractor’s bonding company was dismissed from the suit filed in state court. In finding the dismissal improper, the appeals court also directed the lower court to first determine if the contract, which was performed on federal property, was governed by the Miller Act.

CONTRACTOR TERMINATED FOR DEFAULT BECAUSE OF WORKPLACE SAFETY CONCERNS: A board of contract appeals held that the default termination of a contractor based on workplace safety concerns and project delays due to the contractor’s inability to rectify safety issues in a timely manner was justified.