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Volume 4 - Number 45 | November 13, 2006

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Recent Issues

  EDITOR'S NOTES | Issue 4-45
Bluffing may be an acceptable and encouraged practice at the poker table, but when it comes to business, bluffing is never a good policy. That’s the conclusion of Washington appeals court that faulted a city for soliciting information for a claim from a contractor well after the claim filing expiration had passed. After multiple requests for more information on the claim, the city wrongly rejected the claim as time barred.

Also this week, we look at a contractor that got stuck paying a fixed price contract to its subcontractor for work that was not performed simply because it did not issue a written deductive change order when the owner changed the scope of the contract. And, an attempt to bulk up a claim by purposefully underbidding the contract and filing inflated delay claims does not bode well for a contractor in federal claims court.
  OWNER’S CONTINUED CONSIDERATION OF CLAIMS MAY WAIVE CONTRACTUAL CLAIM INFORMATION REQUIREMENTS
David Wonderlick By David Wonderlick
If an owner allows and encourages discussion on a possible claim well after the contract’s time limitation for a claims filing has expired, it cannot then automatically deny the claim based on a time expiration. The denial must have a more substantial foundation.
  SUBCONTRACT PRICE NOT REDUCED DUE TO LACK OF DEDUCTIVE CHANGE ORDER
Without a written change order, a Louisiana contractor cannot alter the amount of a fixed price subcontract for work. A verbal understanding will not suffice to cancel a line item or adjust the contract price.
  CONTRACTOR PENALIZED $50 MILLION FOR FRAUDULENT CLAIM
A federal claims court does not condone a contractor’s attempt to artificially inflate its claims for delays and defective specifications.