After much disagreement, the Owner, Designer, Insurer(s), and Contractor(s) have agreed to resolve their differences through a settlement. Do these things to help avoid future angst:
Written: All settlements should be written. A settlement is a new contract among the parties, so treat it as such. Besides, memories are fading faster than ever as we use more electronic media.
Essential Terms: Warranty, Indemnity, Confidentiality (detail all duties that end vs. those that continue).
Essential Documents: Don’t just reference other essential documents; attach them to the written settlement agreement (e.g., final lien/claim release, final change order, and/or tax forms).
Payment: Timing and Method. (If there will be damages for delay of settlement payment, consider adding a liquidated damages clause. Will payment be by wire transfer, physical check, credit, other?)
Enforcement: Include a liquidated damages provision if damages will come from delayed payment. And, since it’s a new contract, will you have to file another lawsuit to enforce the agreement? If so, consider a consent judgment where all parties pre-agree that if the terms are not met, a Court can efficiently and expeditiously enforce.
Closeout: Detail how, who, and when other issues will be closed (e.g., dismissal of all litigation or completion of outstanding work).
Insurance Company Had No Duty to Defend Under Eight Corners Rule
To decide if an insurer has a duty to defend, a Virginia State or Federal Court may only look at the allegations in the complaint and the insurance policy to determine if a judgment against the insured will be covered by the policy.
Owner SOL When Mandatory Mediation Didn’t Toll Statute of Limitations
Contract interpretation strives to find the meaning of all parts together.
Government Must Review Claims in Good Faith, Not “Conjure Up” a “Baseless Retaliation”
A contracting officer’s review of certified claims submitted in good faith is not intended to be a negotiating game where the agency may deny meritorious claims to gain leverage over the contractor.
Termination for Convenience was OK to Get a Lower Price
When Massachusetts’ highest State court rejected Federal law on termination for convenience (T4C) a public entity’s “sole discretion . . . for […]
Pirates (Parties) Should Arbitrate Arbitrability
Yes, the word “pirates” is an anagram for “parties.” Participants in a lawsuit, arbitration, or mediation are collectively referred to as parties. Are they pirates too?
Very Bad Behavior Without Bad Faith is Not a Breach of Contract
Despite “abhorrent” behavior by the Army Corps of Engineers, a majority of the Armed Services Board of Contract Appeals held there was […]
Government Construction Contracts Require Bonds, Even When Contract Doesn’t Say So
Yesterday (Nov. 5, 2018), the Fed. Cir. Ct. of Appeals again endorsed the Christian doctrine, which can make unstated requirements part of a government contract.
Government’s Negligent Estimate a Trick?
The Government’s negligent estimate failed to provide the “most current information available.”
Prime Contractor Had No Duty to Help Surety Investigate Sub’s Default
We all know what happens when we “ASS-U-ME” something. So, we should all carefully avoid assuming things unnecessarily.
