Casey Industrial v. Seaboard Surety
Dec 15, 2006OUTCOME: Settlement
We represented a subcontractor claiming outstanding sums owed for delays, extras and outstanding payments. The surety raised various defenses, including that the original claim and lawsuit were time-b ... arred, that the subcontractor's claims were barred by a pay-if-paid and no damages for delay clause, that the subcontractor could not establish its damages properly, and that the subcontractor in fact was liable for delays on the project. We successfully defended the limitations issue at both the motion to dismiss and the motion for summary judgment phase of the case. We conducted extensive research and found no cases giving concrete definition under the AIA 312 payment bonds as to precisely what was "work under the construction contract" and whether punchlist work qualified. It appeared our case was of first impression. The most important issue in the case was that the court agreed with our argument that the surety needed to raise all its factual defenses within 45 days of the first claim notice or the defenses were permanently waived. This issue was again of first impression nationally. The argument was an extension of a Maryland case where the surety simply sent a reservation of defenses letter. After extensive motions practice and discovery, the case eventually settled. There are numerous unprinted decisions from this case which are available on Westlaw/Lexis that were the result of heavy motions practice which went extremely well throughout the case for our client.
