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Decisions Of The Boards Of Contract Appeal: Sub Not Liable For Costs Caused By Local Govt. Restricti

Monday, January 03, 2011 03:08 am


Implied Warranty -- Equitable Adjustment

Appeal of: J. E. McAmis, Inc., 2010 ASBCA Nos. 54455, 54456, 54457 (Nov. 18, 2010)

The federal government didn't believe a project sub should have to comply with a local government road restriction. But that belief didn't relieve the government from liability when the sub was forced to use alternate, and more costly, roads to access the site.

The U.S. Army Corps of Engineers (Corps) entered into a fixed-price contract with J.E. McAmis, Inc. (McAmis) for a $9.8-million Sacramento River construction project. McAmis' subcontractor Nordic Industries, Inc. (Nordic) was to deliver quarried rock to the project site on both the east and west sides of the river. The contract depicted haul routes by which the project site could be accessed, and Nordic drove and thoroughly examined the routes (noting speed limits, truck crossings and weight limits) before bid submittal. After contract award, however, the county passed a vehicle weight limit ordinance on some routes. This blocked Nordic's access to the river's east side and resulted in a substantial increase in hauling costs. Nordic filed a claim to recover these costs, which the Corps' contracting officer denied. McAmis appealed to the Armed Services Board of Contract Appeals.

Mc [...]

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