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Sub Can't Sue For Prompt Payment

Thursday, December 01, 2011 06:03 am


Prompt Payment Act

U.S. f/u/b/o IES Commercial, Inc. v. The Continental Insurance Co., Inc., 2011 U.S. Dist. Lexis 112497 (D. D.C. Sept. 30, 2011) A subcontractor sought an avenue other than the Miller Act to recover payment due. But a district court ruled the sub could not sue in the name of the Prompt Payment Act.

Delays and contract changes led to a payment dispute between Grunley Construction Company, Inc. (Grunley) and its subcontractor IES Construction Company, Inc. (IES) in the performance of a government contract to build tunnels near the U.S. Capitol Power Plant in Washington D.C.. IES was to perform the electrical work for a fixed price of $118,600. Seeking payment, IES first filed a Miller Act claim against Grunley's sureties. But after Grunley sued for damages for additional costs incurred as a result of IES's breach of subcontract, IES counter-sued for violation of the Prompt Payment Act (31 U.S.C. 3901-3907) and sought "interest, penalties, and attorney's fees provided b [...]

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