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Govt. Culbable For Failing To Procure Permit Despite Clause Obliging Contractor To Do So

Thursday, December 04, 2008 04:36 pm

Govt. Culbable For Failing To Procure Permit Despite Clause Obliging Contractor To Do So

Displeased with a contractor's slow and allegedly shoddy work, a government agency opted for contract termination rather than time extensions. An appeals board called that decision a mistake.

When Jody Builders Corporation (Jody) failed to complete work on a $900,000 U.S. Postal Service project to build a post office in Bushkill, Pennsylvania, the government terminated the contract for default. Jody appealed, claiming it was entitled to a time extension since project delays were caused by the government and adverse weather.

Specifically, Jody claimed that the government failed to provide a conservation district-approved Erosion and Sedimentation Plan (E&S Plan) -- without which Jody could not perform activities that would disturb the soil -- until two months after issuance of the Notice to Proceed. The resulting delay pushed the project into the winter months during which severe weather hindered earthwork and building foundation installation.

Contract can't hold sub at fault for govt. failures

The government denied its obligation regarding approval of the E&S Plan, pointing to a contract clause that held Jody responsible "for obtaining any necessary licenses and permits."The government claimed that, because the contract charged Jody with responsibility to procure an approved E&S Plan, any associated delays were also Jody's responsibility.

The Board found this logic faulty since the government had clearly taken responsibility for procuring the required E&S Plan: The government had prepared and submitted the plan, made necessary revisions, received final approval and provided the final plan to Jody.

Further, the government did not, i [...]

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