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Brooklyn judge moves Barclays contract dispute forward

July 8, 2014 By Charisma L. Miller, Esq. Brooklyn Daily Eagle
A Barclays Center case will move forward in court
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A contract case between general and subcontractors is allowed by move forward in Brooklyn’s Commercial Division, Brooklyn Supreme Court Justice Carolyn Demarest ruled.

General contractor Hunt Construction Group Inc. entered into a subcontract with The Laquila Group Inc. for Laquila to provide excavation and foundation work for the then-anticipated Barclays’ Center in Prospect Heights, Brooklyn. The original contract price was set at $27.5 million with the understanding that the work had to be completed in a timely manner due to events at Barclays already scheduled around the completion date.  The contract also made clear that all changes in the work order must be done in writing and stated that Hunt would not pay for any work done by Laquila without a written work order. 

In January 2013, Laquila submitted a claim requesting $10,870,534.34 be paid by Hunt for additional costs incurred during the project. Laquila specifically pointed to a “7.4 month” delay in the Barclays project caused his company to assume unexpected costs and that the original contract price was based on representations not followed through on by Hunt.

Laquila asserted that, throughout the project, adjustments were made for unexpected complications including, toxic soil disposal, site flooding and the removal of an underground oil tank.  These adjustments or change to the work order were agreed to verbally and later documented in writing.

Hunt argued, however, that the contract expressly released Hunt of any obligation to pay for work done outside of a written work order. Attached to Laquila’s monthly payment application form from Hunt, was a waiver stating advising that Laquila “releases and relinquishes any and claims … arising out of … the work performed on the [Barclays project] transpiring prior to the date [of Work Order].”

Reviewing the facts and general business standards, Demarest found that the waivers on the payment forms raised questions as to exact nature of the waivers and to what circumstances they applied. Hunt attempted to circumvent Laquila’s breach of contract claim by arguing that the contract prohibited oral agreements. In Demarest’s review, Hunt did not argue that no oral agreements were made and instead asserted that the oral agreements were merely invalid.

“Defendant [Hunt] has failed to demonstrate the absence of a valid claim with any documentary evidence and has not challenged the accuracy of [Laquilla]’s allegations regarding purported oral modifications, instead relying on the effect of the no-oral-modification clause.” 

Brian Keatts, an associate principal at Zetlin & De Chiara, represents Hunt in this matter. Thomas Finegan, an attorney at Goetz Fitzpatrick, serves as counsel for Laquila.

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