Carolina Casualty Insurance Company, et al. v. R.L. Brown & Associates, Inc., et al.
No. 1:04-CV-3537-GET, 2006 U.S. Dist. LEXIS 5261 (N.D. Ga. January 25, 2006)
In Carolina Casualty Insurance Company, et al. v. R.L. Brown & Associates, Inc., et al., No. 1:04-CV-3537-GET, 2006 U.S. Dist. LEXIS 5261 (N.D. Ga. January 25, 2006), a dispute arose between a surety that had provided a performance bond on a public works project and the project’s program manager. After the owner declared the general contractor in default for defective work, the surety finished the underlying contract under the terms of the performance bond. The owner sought additional damages from the surety. In an agreement settling those claims for additional damages, the owner assigned to the surety all of its own claims against third parties arising out of the defective construction and supervision of the project.

MidAmerica Construction Management, Inc. v. MasTec North America, Inc., et al.
2006 U.S. App. Lexis 3022 (10th Cir. 2006)
In MidAmerica Construction Management, Inc. v. MasTec North America, Inc., et al., 2006 U.S. App. Lexis 3022 (10th Cir. 2006), the Court held that a subcontract agreement contained a “pay-if-paid” clause, and that the clause in question was enforceable under both Texas and New Mexico law. As a result, general contractors did not need to pay the subcontractor for the work that the subcontractor performed under the contract, because the general contractors had not been paid by the project owner for that work.

Matrix Construction, LLC v. Barton Malow and Schoolcraft College
2006 Mich. App. LEXIS 429, No. 265156 (February 21, 2006)
In Matrix Construction, LLC v. Barton Malow and Schoolcraft College, 2006 Mich. App. LEXIS 429, No. 265156 (February 21, 2006), the Court held that a contractor could not maintain a suit against a construction manager for negligence where the alleged duty arose under the construction manager’s contract with the owner.
Contractor, Matrix Construction, LLC entered into a contract with Owner, Schoolcraft College to furnish and install numerous items for a construction project. Owner also contracted with Construction Manager, Barton Malow to manage and supervise Contractor’s work on the project. Contractor filed suit against Construction Manager alleging that Construction Manager negligently managed the project by failing to properly “supervise, coordinate, plan and schedule the work performed on the project.”

RDP Royal Palm Hotel, L.P. v. Clark Construction Group
Nos. 04-16203 and 05-11713, 2006 U.S. App. LEXIS 3815 (11th Cir. Feb. 17, 2006)
RDP Royal Palm Hotel, L.P. v. Clark Construction Group, Nos. 04-16203 and 05-11713, 2006 U.S. App. LEXIS 3815 (11th Cir. Feb. 17, 2006) held that an Owner could not enforce the substantial completion date where the Owner continued to issue change orders and construction change directives after this date had passed. As a result of this waiver, the court further held that the Owner could not hold the Contractor liable for any damages incurred by the Owner as a result of the failure to achieve substantial completion by the substantial completion date.

El Dorado Irrigation Dist. v. Traylor Bros., Inc.
No. 03-949, 2006 U.S. Dist. LEXIS 1354 (E.D. Cal. Jan. 4, 2006)
In El Dorado Irrigation Dist. v. Traylor Bros., Inc., No. 03-949, 2006 U.S. Dist. LEXIS 1354 (E.D. Cal. Jan. 4, 2006), the court construed the effect of a liquidated damages clause on plaintiff’s ability to recover other categories of actual damages. The plaintiff sued the defendant contractor, seeking recovery of liquidated damages, loss of power sales, loss of public grant funds, and other damages related to the late completion of the project. The contract contained a liquidated damages clause, which defined the “damages for Contractor delay” at $500 per calendar day.

Ed Kimber Heating & Cooling, Inc. v. Travelers Casualty & Surety Co.
No. 3:03cv2111 (SRU), 2006 U.S. Dist. LEXIS 3323 (D. Conn. Jan. 26, 2006)
Trataros Construction, Inc. (“Trataros”), the general contractor on a school addition and renovation project, subcontracted with Ed Kimber Heating & Cooling, Inc. (“Kimber”) for the performance of HVAC and plumbing work. Travelers Casualty & Surety Co. (“Travelers”) issued payment and performance bonds as the surety for Trataros.

Gustine Uniontown Assocs., LTD v. Anthony Crane Rental, Inc.
2006 PA Super 12 (Pa. Super. Ct. 2006)
In conjunction with its construction of a shopping mall over a non-functioning coal mine, project owner Gustine entered into a standard American Institute of Architect form of agreement, AIA B141, with the project architect ASG. Article 9.3 of the contract stated:
“Causes of action between the parties to this Agreement pertaining to acts or failures to act shall be deemed to have accrued and the applicable statutes of limitations shall commence to run not later than either the date of Substantial Completion for acts or failures to act occurring prior to Substantial Completion, or the date of issuance of the final Certificate for Payment for acts or failures to act occurring after Substantial Completion.”

City of Ferndale v. Florence Cement Co
2006 Mich. App. LEXIS 129, No. 254572 (January 17, 2006)
In City of Ferndale v. Florence Cement Co. and Hartford Casualty Insurance Co., 2006 Mich. App. LEXIS 129, No. 254572 (January 17, 2006), the Court held that the engineer’s decision under the disputes resolution provision of the contract did not constitute a final and binding arbitration award.

Appeal of M.A. Mortenson Company
No. 53761, 2006 ASBCA LEXIS 4 (ASBCA Jan. 26, 2006)
Appeal of M.A. Mortenson Company, No. 53761, 2006 ASBCA LEXIS 4 (ASBCA Jan. 26, 2006) held that the Severin doctrine did not prevent the prime contractor’s claims on behalf of its subcontractor where (1) there was contemporaneous evidence that the subcontractor expressed an intention to seek compensation in addition to amounts afforded via change order and (2) the prime contractor did not contend that such a claim was barred by the language of the change order.

Beckwith Machinery Company v. Asset Recovery Group, Inc.
2005 Pa. Super. 429, 2005 Pa. Super. LEXIS 4276 (Pa. Super. Ct. 2005)
In Beckwith Machinery Company v. Asset Recovery Group, Inc., et al., 2005 Pa. Super. 429 (Pa. Super. Ct. 2005), the Court held that invoices for major repairs in the nature of capital improvements to heavy construction equipment were not covered by the terms of a payment bond. The Court reasoned that the repairs referenced in the invoices at issue could not be classified as ordinary maintenance performed for consumption over the course of the project, but rather were services which a contractor would retain the benefit of on the completion of work to be used by him in a like manner on subsequent projects.