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Subcontract Ambiguous Regarding Mechanical Versus Structural Work

Tuesday, January 08, 2019 02:45 pm


Ambiguity --- Scope of Work

Trane US Inc. v. Yearout Serv., LLC, 2018 U.S. Dist. Lexis 210153 (December 13, 2018)

A contractor could not convince a court on summary judgment that it acted properly when it withheld payment from a mechanical sub for failure to perform work that may have fallen outside its subcontract's scope.

GSC Construction, Inc. (GSC) was the general contractor on a U.S. Army Corps of Engineers (Corps) project to renovate a building at Robins Air Force Base in Warner Robins, Georgia. Yearout Service, LLC (Yearout), was the mechanical/plumbing subcontractor on the project.

According to Yearout, GSC failed to pay for completed subcontract work. Yearout pursued claims against both GSC and the contractor's Miller Act payment bond surety (the defendants) for GSC's alleged breach of payment obligations under the subcontract. Yearout also alleged that GSC breached the subcontract by issuing design changes but not change orders to compensate Yearout for the added costs.     

In response, the defendants jointly moved for summary judgment, arguing that Yearout was the party that materially breached the subcontract and is therefore barred from recovering against either of them for their alleged breach of contract. The court sided with Yearout and denied the defendants' motio [...]

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