ABC Weighs-In on No Damage for Delay Provisions on Public Projects
Amicus curiae (Latin for “friend of the court”) refers to a brief submitted by someone who is not a party to a particular lawsuit, but who believes that the court's decision may affect its interest, and therefore, offers information and/or legal authorities for the court to consider. It is not uncommon for such briefs to be submitted on behalf of trade organizations, such as ABC. In fact, ABC recently filed an amicus curiae brief to the Louisiana First Circuit Court of Appeal and Louisiana Supreme Court in connection with the case of F.H. Myers Const. Corp. v. State, Div. of Admin. Office of Facility Planning & Control.
On November 7, 2014, the Louisiana Supreme Court denied the State’s request to review the First Circuit’s decision in that case which struck down a contractual provision in a State contract prohibiting a contractor from recovering extended-fixed jobsite overhead costs in certain situations. As a result, the decision of the First Circuit is governing law in the State of Louisiana.
Specifically at issue in the case was a provision in the State’s contract which allowed a contractor to recover extended-fixed jobsite overhead for time delays on a project, but only when the following conditions were met: the contractor experienced a complete stoppage of work, the contractor was unable to mitigate financial damages through replacement work, and the stoppage was attributable solely to acts or omissions of the owner. F.H. Myers argued that those limitations in the contractual provision expressly violated La. R.S. 38:2216(H). The statute prohibits “[a]ny provision contained in a public contract which purports to waive, release, or extinguish the rights of a contractor to recover cost of damages, or obtain equitable adjustment, for delays in performing such contract, if such delay is caused in whole, or in part, by acts or omissions within the control of the contracting public entity or persons acting on behalf thereof…” The trial court ruled in favor of the State and dismissed F.H. Myer’s claims. However, on appeal, the First Circuit agreed with F.H. Myer’s position and held that requirements of a “complete stoppage of work” and that the stoppage must be “solely” attributable to the owner were impermissible attempts to limit a contractor's ability to recover damages for delay on a public project.
The decision was a particular victory for ABC. Associated Builders and Contractors, Inc., Pelican Chapter, jointly with the Louisiana Associated General Contractors, Inc., as well as Associated Builders and Contractors, Inc., Bayou Chapter submitted amicus curiae briefs to the First Circuit Court of Appeal in support of the position of F.H. Myers. Thereafter, those three entities as well as Associated Builders and Contractors, Inc. of Louisiana submitted a joint amicus curiae brief to the Louisiana Supreme Court explaining that the appellate court decision was in accordance with Louisiana law and requesting that the Supreme Court not review or disturb the decision. The rulings of both the First Circuit and Supreme Court were consistent with the position of the trade organizations.This case unquestionably benefits contractors performing public work in the State of Louisiana and is a prime example of the positive effect trade organizations can have on the judicial process when they weigh in on significant legal issues affecting their industry.