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Beware E-mail Pitfalls When It Comes To Proving Your Claim Based On Past Communication

Friday, April 04, 2008 02:40 pm

3 Strikes And A Contractor Is Out $50k After Failing To Secure Payment Based On Govt. Contract Discrepancies

A subcontractor's claim that contract ambiguities introduced work — and associated costs — not contemplated by the contract stood no chance against the government's somewhat conflicting but nevertheless thorough contract language.

Caigeann was Manhattan Construction Company's subcontractor on a United States Department of Agriculture (USDA) project to construct a Human Nutrition Center in Beltsville, Maryland. At trial, Caigeann claimed that conflicts in the USDA's specifications and drawings for (1) locations for steam traps, (2) installation of air-handling units and (3) construction of a hot water temperature maintenance system caused it to incur costs not included in its initial bid. Caigeann had been hired to install mechanical and plumbing systems for a total of $6,117,000, but during the project it submitted to the government three additional payment proposals totaling approximately $50,000. The government denied all three.

The ambiguity Caigeann perceived stemmed from discrepancies it found between the government's drawings and specifications. During the project, the subcontractor requested information from the USDA on all three counts of confusion. The government's response in each case was that the work was required and within the scope of the contract. The court agreed.

Don't make assumptions based on vague info

The USDA's drawings did not show a symbol for every steam trap required, although written instructions indicated that they were to be installed at low points "such as ends of mains [and] bottoms of risers." Caigeann didn't interpret the contract as requiring traps at the base of every riser because it didn't believe the bases of risers were alw [...]

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