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UNITED STATES EX REL. CHASE SOMERSET CORP. v. BECO

November 19, 1993

THE UNITED STATES OF AMERICA for the use and benefit of CHASE SOMERSET CORPORATION, Plaintiff,
v.
BECON SERVICES CORPORATION, and AETNA CASUALTY & SURETY COMPANY, Defendants.



The opinion of the court was delivered by: PATRICK J. ATTRIDGE

 Before the Court, pending resolution, are three dispositive motions. The defendant, Becon Services Corporation *fn1" (Becon), moves for summary judgment on the grounds: (1) that the plaintiff, Chase Somerset Corporation (Chase), has unconditionally and completely released it from all claims under the contract between them; (2) that Chase has failed to comply with the contract notice requirement with respect to its claim for money damages and therefore is precluded from seeking additional compensation, and (3) Chase's cross-motion for summary judgment in its favor on Becon's counter claim for attorney fees and costs.

 In the summer of 1990, Chase and Becon entered into a contract under which Chase agreed to provide labor and materials relating principally to the installation of drywall, stucco, acoustical ceiling and doors at the National Defense University, Fort McNair, Washington, D.C. in consideration of the payment of $ 1,825,000.00. Becon was the general contractor and Chase was one of its subcontractors on the project

 The subcontract general conditions provided that:

 
[the] Subcontractor shall invoice Contractor by the 25th of the month for the work performed during the thirty (30) days prior period. Contractor will pay Subcontractor within thirty (30) days after receipt (of) an approved and corrected invoice supported with a "Partial Release of Lien" (Attachment 1) the amount of the invoice less ten (10%) percent retention or whatever amount is retained by the Owner, which ever is greater. (Article 22 (C) of the Subcontract General Conditions.)

 With respect to changes in the work that may become necessary the agreement provided that:

 
If such changes cause a material increase or decrease in the cost of performing the work on the time of performance and prompt written notice of any increase is given by Subcontractor to Contractor not later than seven (7) calendar days after the giving of such notice of change, an adjustment in the Subcontract price and/or the time of performance shall be made. (Article 4A of the Subcontractor General Conditions.)

 Concerning delays in the progress of the subcontractor, the general conditions provide:

 
If Subcontractor is delayed in the progress of the Work, written notice thereof and of the anticipated results shall be given by Subcontractor to Contractor not later than seven (7) calendar days after the event causing the delay. Delays caused by the Contractor or Owner or by circumstances beyond the reasonable control of Subcontractor and not reasonably foreseeable by Subcontractor in time to be prevented shall, upon approval by Contractor, be the basis for an extension of time of completion, provided that timely notice has been given as required by this Article. Subcontractor hereby waives any claim to damages which it may suffer by reason of any such cause which delays Subcontractor in the performance of the Work. (Article 8 of the Subcontractor Conditions.) (Emphasis added.)

 Lastly, the general conditions state:

 
No claim for additional compensation . . . shall be considered unless presented to Contractor's Site Manager in writing within ten (1) days after the occurrence giving rise to the dispute and include complete justification to include time and cost detail of the claim. . . . (Article 28 B of the Subcontract General Conditions.)

 After signing 22 separate releases between July 25, 1990 and November 10, 1992, (Attachment 1 referred to in Article 22(C) of the Subcontractor General Conditions) acknowledging receipt of progress payments under the contract, Chase made a claim against Becon for an additional $ 1,213,477.00 for labor costs it contends it incurred because of delay and other inefficiencies it encountered by reason of the actions of the contractor. Becon refused to honor this demand and this suit followed.

 Becon denies that its actions in anyway contributed to the delays Chase allegedly encountered and seeks summary judgment in its favor contending that by signing each of the 22 partial payment certificate and release of liens, Chase released Beacon for all claims and obligations of every nature arising out of the subcontract covering the period immediately preceding the date on which the release was executed.

 Beacon, in a supplemental filing, also seeks summary judgment on the grounds that Chase is precluded from claiming additional sums because it failed to give timely written notice of the claim it now asserts. It urges that under Article 15 of the General Conditions, "failure to provide timely notice constitutes a ...


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