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DIRECTORY AND CAPABILITIES

When a Request for Equitable Adjustment Should Be Treated as a Claim Under the Contract Disputes Act

August 29, 2022 — David Adelstein - Florida Construction Legal Updates
In federal contracting, contractors are sometimes torn about submitting a request for equitable adjustment (known as an “REA” under 48 C.F.R. 252.243-7002) or submitting a formal claim under the Contract Disputes Act (41 U.S.C. s. 7103), the latter requiring a final decision by the contracting officer and starts the clock with respect to interest and preserving rights. It is also sometimes not easy for the contracting officer receiving an REA to determine whether the REA is actually a claim under the Contract Disputes Act requiring more immediate action. This recent take by the United States Court of Appeals for the Federal Circuit hits the nail on the head:

We recognize that contracting officers will sometimes face the difficult challenge of determining whether a request for equitable adjustment is also a claim. Contractors must choose between submitting a claim—which starts the interest clock but requires the contracting officer to issue a final decision within 60 days—and submitting a mere request for equitable adjustment—which does not start the interest clock but gives the contractor more time to negotiate a settlement and possibly avoid hefty legal fees. The overlap between these two types of documents might create room for gamesmanship. For example, a contractor could submit a document that is a claim—starting the interest clock—but appears to be a mere request for equitable adjustment—causing the contracting officer to not issue a final decision within the 60-day deadline and allowing interest to accrue for months or years. But the government has tools to address this challenge: The contracting officer can communicate to the contractor that she is going to treat the document as a claim and issue a final decision within 60 days. Or the government can explicitly require the contractor to propose settlement terms and attempt to settle disputes before submitting a claim to the contracting officer for a final decision.

Zafer Construction Company v. U.S., 2022 WL 2793596, *5 (Fed.Cir. 2022).

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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Billionaire Behind Victoria’s Secret Built His Version of the American Heartland

June 25, 2019 — Sophie Alexander - Bloomberg
Beyond emerald-green golf links, over snow-white fences, and past tree-lined cul-de-sacs rises the American fantasyland of billionaire Les Wexner. Here in the middle of Ohio, of all places, Wexner—the man behind Victoria’s Secret and its push-up-bra notions of female beauty—has brought to life his singular vision of the heartland. Read the court decision
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Reprinted courtesy of Sophie Alexander, Bloomberg

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Hawaii Supreme Court Bars Insurers from Billing Policyholders for Uncovered Defense Costs

April 23, 2024 — Amanda C. Stefanatos - Saxe Doernberger & Vita, P.C.
Across the country, there is a split in authority as to whether an insurance company should be allowed to recoup defense costs where it is ultimately determined that the carrier has no duty to defend under the policy and the policy is silent as to such reimbursement. The Hawaii Supreme Court is the latest to enter the fray to address this very question, ruling in favor of policyholders in the recent case of St. Paul Fire & Marine Insurance Company v. Bodell Construction Company. Facts of the Case and Procedural History The Bodell case arose in response to a pair of certified questions from the US District Court for Hawaii to the Hawaii Supreme Court. The case involved a group of primary and excess insurers that sold liability policies to Bodell Construction and sought reimbursement of defense costs that the insurers had paid to defend a construction defect claim against Bodell. In the Underlying Action, the District Court ultimately ruled that the claims against Bodell Construction were not covered under the policies. Because the claims were not covered, the insurers demanded reimbursement of the defense fees from Bodell . Having determined there was no Hawaii state law on this issue, and in light of conflicting decisions in the district courts, the US District Court for Hawaii requested guidance from the Hawaii Supreme Court. Read the court decision
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Reprinted courtesy of Amanda C. Stefanatos, Saxe Doernberger & Vita, P.C.
Ms. Stefanatos may be contacted at AStefanatos@sdvlaw.com

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Architectural Firm, Fired by School District, Launches Lawsuit

October 01, 2013 — CDJ STAFF
El Associates Architects and Engineers is suing the Boyertown School District after the district fired them for underestimating the cost of an expansion project. The school district, located in Pennsylvania, was seeking to increase student capacity. El Associates estimate lead to a $55 million budget, but D’Huy Engineering, the district’s construction management firm, estimated $70 million for the project. After the Boyertown School District hired KCBA Architects, El Associates filed suit. El Associates contends that it had followed the contract requirements and that the school district was in violation of the contract’s provisions on terminating the agreement. Read the court decision
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Timely Legal Trends and Developments for Construction

February 18, 2019 — Matt Viator - Construction Executive
The construction industry is broad and the legal concerns of industry members can be far-reaching. What seems like tomorrow’s problem often jumps to the forefront and becomes a high priority today. 2018 was full of moments like these – and it’s important to keep track of legal developments for a glimpse at what may be waiting around the corner. With that in mind, here are some of the most important legal developments for the construction industry from the second half of 2018. Sureties and Litigation – a Broad Topic Sureties play a vital role on construction projects. On federal jobs and state, county or municipal jobs, surety bonds are typically required. That means it’s important to stay on top of how the courts are treating surety agreements. Reprinted courtesy of Matt Viator, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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Deleted Emails Cost Company $3M in Sanctions

January 13, 2017 — Grace V. Hebbel - Saxe Doernberger & Vita, P.C. Blog
Recently, the Federal District Court for the District of Delaware imposed $3 million in punitive sanctions in order to redress harms caused by a company’s bad faith deletion of tens of thousands of emails during the course of litigation. The sanctions were ordered pursuant to Federal Rule of Civil Procedure 37, which was amended effective December 1, 2015 to permit sanctions for the failure to preserve electronically stored information (“ESI”). In GN Netcom, Inc. v. Plantronics, Inc.,1 the plaintiff, GN Netcom, brought an antitrust suit alleging that the defendant company, Plantronics, interfered with distributors to stop GN Netcom from marketing its product. Upon receipt of GN Netcom’s demand letter, Plantronics issued a litigation hold and began providing training sessions to its employees to ensure compliance. Upon filing of GN Netcom’s suit, Plantronics issued an updated litigation hold and continued training sessions. Read the court decision
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Reprinted courtesy of Grace V. Hebbel, Saxe Doernberger & Vita, P.C.
Ms. Hebbel may be contacted at gvh@sdvlaw.com

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Congratulations to Haight Attorneys Selected for the 2024 Edition of Best Lawyers and Best Lawyers: Ones to Watch

September 11, 2023 — Haight Brown & Bonesteel LLP
Best Lawyers and Best Lawyers: Ones to Watch – 2024 Edition Best Lawyers 2024 Edition

• Bruce Cleeland
• Peter Dubrawski
• Denis Moriarty
• Theodore Penny

Best Lawyers: Ones to Watch 2024 Edition

• Frances Brower
• Kyle DiNicola
• Kristian Moriarty
• Arezoo Jamshidi
• Josh Maltzer
• Philip McDermott
• Patrick McIntyre
• Annette Mijanovic
• Kathleen Moriarty
• Bethsaida Obra-White

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Reprinted courtesy of Haight Brown & Bonesteel LLP

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Failure to Comply with Sprinkler Endorsement Bars Coverage for Fire Damage

July 31, 2013 — Tred Eyerly, Insurance Law Hawaii
Despite its application stating otherwise, the insured's failure to install a sprinkler system in its building barred coverage for extensive damage caused by fire.American Way Cellular, Inc. v. Travelers Prop. Cas. Co. of Am., 2013 Cal. App. LEXIS 425 (Cal. Ct. App. May 30, 2013). American Way contacted a broker, A&J, regarding liability and property coverage. A&J sent American Way an application for a policy with Travelers. The application indicated American Way had a sprinkler system and fire detectors in its building. Travelers issued a policy with a Protective Safeguards Endorsement For Sprinkler Locations and Restaurants. The endorsement stated that as a condition of the insurance, the insured was required to maintain a sprinkler system. An exclusions section said the insurer would not pay for loss caused by fire if there was no sprinkler system. Read the court decision
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Reprinted courtesy of Tred Eyerly
Tred Eyerly can be contacted at te@hawaiilawyer.com

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