Legal Question in Construction Law in Iowa

Unreasonable working conditions, exceeding contract amount

Job was sub-contracted by a sub-contractor who bid the job at a

specific amount based on the amount of bricks. Our company took

the job based on the original contract amount. The land around the

building was not graded properly causing standing water around

the foundation. Our company had to spend time, money and labor

to regrade the land (not our job) and use heaters & propane to dry

everything up. Job ended up taking twice as long because of the

conditions. Also, the original bid was incorrect and additional

bricks & materials (meaning extra labor) were needed to finish the

building. Our company ended up with bills approx. $65,000 above

the contract price. The original sub-contractor walked away with

$15,000+the retainage for the job for doing nothing, not to mention

incorrectly bidding the job. The contract clearly stated that the job

must be completed to collect. In order to complete the job, more

materials needed to be ordered. Now we want to recoop the

extras and the retainage which is rightfully ours, not the original

sub-contractor�s. Where do we go from here?


Asked on 10/04/05, 11:49 am

1 Answer from Attorneys
Vincent W. King Vincent W. King, PA

Re: Unreasonable working conditions, exceeding contract amount

Sounds like there's a possible claim lurking in there somewhere. But it isn't clear what role your company played in the job. If I understand it correctly, you replaced the original masonry sub on the job...? or were you a sub-sub to the masonry sub? I just can't tell from the message.

The most important thing to do is to look in your contract for any notice provisions regarding claims and follow them. Usually these notice provisions will have a deadline by which the notice must be sent (for example, 14 days after first observing the changes condition). Also, if there is a payment bond on the job that was furnished by your prime contractor or by the general contractor, you may have the ability to make a claim against the bond...you should call the owner or architect to find out about the payment bond. Even if there is no payment bond, there is a chance you may have lien rights but they are time-sensitive so you need to look into that and get the lien filed as soon as possible, if you have a valid lien claim.

Beyond that, the validity of your claim is dependent on the facts. For example, if you just relied on the numbers given by the original sub and didn't do any investigation of your own before taking the work over, the court or arbitrators might conclude you only have yourself to blame (I'm not saying this will definitely be the case, only that it's a risk). However, the poor grading -- if it couldn't have been discovered before you started work -- appears possibly to be a real "changed condition" and there might be some compensation available there.

Although I'm not licensed in Iowa, I concentrate in construction law and would be happy to speak with you about the generalities of the situation at your convenience. If you decide to proceed, I can work with local counsel if necessary.

In any event, good luck to you.

Standard disclaimer: The comments above are based on limited facts and should not be considered legal advice. We do not have an attorney-client relationship.

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Answered on 10/04/05, 4:54 pm


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