People in California may have heard about an interesting legal case between a construction company and the Palo Alto school district that has been heating up recently. The case stems from a contract that was awarded to Taisei Construction for the construction of two new buildings at Palo Alto High School. One of the buildings was a state-of-the-art media arts center, while the other was a two-story math and social studies classroom building.
Taisei is alleging that the school district acted in bad faith, resulting in significant construction delays and additional costs incurred by Taisei. They claim that the district significantly changed the scope of work after the contract had been signed, resulting in additional expenses, labor and costs for Taisei. The two buildings, which have only recently been opened to students, had their completion dates delayed by almost a year.
Taisei is seeking $3.5 million from the Palo Alto school district for breach of contract after the district allegedly sought large changes to the project, but refused to pay for the increased amount of work Taisei would have to do to complete the project. Taisei is also suing the architecture firm and construction management company for negligence and interference with their contractual negotiations with Palo Alto. In rebuttal, attorneys for the construction manager have claimed that their client was simply doing their job, and owed no duty of care to Taisei.
Taisei recently refused to enter into mediation unless the court set a hearing date. Construction litigation, especially in a complex construction dispute involving multiple parties and claims, can be extremely involved. Having a California construction attorney to lead the charge or simply consult on the issues may be a good idea, whether it's a massive multi-million dollar project or a simple contract dispute.
Source: Palo Alto Online, "Construction firm threatens to take Palo Alto school district to trial," Elena Kadvany, Oct. 28, 2014