{"id":897427,"date":"2020-05-06T10:43:44","date_gmt":"2020-05-06T16:43:44","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=897427"},"modified":"2020-05-06T10:43:49","modified_gmt":"2020-05-06T16:43:49","slug":"claim-for-interest-defective-work-claim","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/claim-for-interest-defective-work-claim\/","title":{"rendered":"Contractor\u2019s Claim for Interest on Subcontractor\u2019s Defective Work Claim Gains Mixed Results"},"content":{"rendered":"\n<p>John J. Gazzola | <a rel=\"noreferrer noopener\" href=\"https:\/\/www.consensusdocs.org\/contractors-claim-for-interest-on-subcontractors-defective-work-claim-gains-mixed-results\/\" target=\"_blank\">ConsensusDocs<\/a><\/p>\n\n\n\n<p><strong>Skanska USA Bldg., Inc. v. J.D. Long Masonry, Inc., No. SAG-16-933, 2019 BL 336852, 2019 US Dist Lexis 152787 (D. Md. Sept. 9, 2019)<\/strong><\/p>\n\n\n\n<p>This case concerns calculation of a damages award to a general contractor, Skanska USA Building, Inc., on its claim for breach of contract against its masonry subcontractor, J.D. Long Masonry, Inc., arising from Long\u2019s faulty construction of a masonry fa\u00e7ade at a medical research facility in Baltimore. When the fa\u00e7ade collapsed and Long failed to repair it, Skanska hired a replacement subcontractor, C.A. Lindman, to remediate Long\u2019s defective work and filed suit against Long to recover the resulting damages. After the court granted Skanska\u2019s motion for summary judgment as to liability, Skanska moved for summary judgment on the issue of damages, relying on the indemnification provision of the subcontract to seek compensatory damages, pre- and post-judgment interest, and litigation fees. In the subcontract, Long agreed to indemnify and hold Skanska harmless from all claims, losses, costs and expenses, including attorneys\u2019 fees, arising before or after completion of Long\u2019s work, caused by, arising out of, resulting from, or occurring in connection with Long\u2019s performance of the work or breach of the subcontract.<\/p>\n\n\n\n<p>The court first applied the terms of this provision to award Skanska compensatory damages, holding that Skanska was, as a matter of law, entitled to recover the amount of the Lindman subcontract and general conditions incurred to supervise remediation of Long\u2019s work. The court, however, denied Skanska\u2019s claim for pre-judgment interest on the entirety of these damages. Skanska asserted that it was entitled to pre-judgment interest on the full award, calculated from the date on which it first paid Lindman. The court disagreed, explaining that, under Maryland law, a claimant is entitled to an award of pre-judgment interest as of right only when the amount due is certain, definite and liquidated by a specific date prior to judgment. The court reasoned that, because much of the Lindman subcontract value was composed of later-executed change orders, an award of pre-judgment interest could not be uniformly calculated back to the date of Skanska\u2019s first payment to Lindman. And moreover, because Skanska continued to withhold sums due to Lindman pending resolution of certain issues, awarding Skanska pre-judgment interest on amounts it had not yet paid would result in a \u201cwindfall\u201d to Skanska because there was no \u201cuse of income\u201d loss to be compensated.<\/p>\n\n\n\n<p>The court also refused to award pre-judgment interest on Skanska\u2019s overhead and supervisory costs, on grounds that there was no fixed, certain date on which Skanska\u2019s claim to them became liquidated and that these damages were actually composed of costs that Skanska would have incurred regardless of Long\u2019s beach. As such, the court awarded Skanska pre-judgment interest only on amounts actually paid to Lindman and on a \u201ccheck by check\u201d basis, or from the particular date on which each such payment was made.<\/p>\n\n\n\n<p>Next, the court awarded Skanska its attorneys\u2019 fees, concluding that the subcontract\u2019s indemnification provision expressly provided for such an award because it tied payment of such fees to an action for breach and indicated that Long would indemnify Skanska for fees incurred in a suit between them. The court denied Long\u2019s request for a reduction in the award, noting that Long\u2019s complained-of delays arose from Skanska\u2019s need to investigate and repair Long\u2019s defective work in order to quantify its damages, efforts that did not \u201cunreasonably balloon Skanska\u2019s legal fees.\u201d<\/p>\n\n\n\n<p>Finally, applying federal law, the court awarded post-judgment interest on the total judgment entered against Long, calculated from the date the judgment was entered.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>John J. Gazzola | ConsensusDocs Skanska USA Bldg., Inc. v. J.D. Long Masonry, Inc., No. SAG-16-933, 2019 BL 336852, 2019 US Dist Lexis 152787 (D. Md. Sept. 9, 2019) This case concerns calculation of a damages award to a general contractor, Skanska USA Building, Inc., on its claim for breach of contract against its masonry&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/claim-for-interest-defective-work-claim\/\">Continue reading <span class=\"screen-reader-text\">Contractor\u2019s Claim for Interest on Subcontractor\u2019s Defective Work Claim Gains Mixed Results<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[11015,4],"tags":[9895,158,228,200],"class_list":["post-897427","post","type-post","status-publish","format-standard","hentry","category-construction-claims","category-construction-defects","tag-advise-consult","tag-breach-of-contract","tag-construction-defect-claims","tag-faulty-construction","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Contractor\u2019s Claim for Interest on Subcontractor\u2019s Defective Work Claim Gains Mixed Results - Advise &amp; 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