Construction contracts generally contain various provisions including standard protest and claim clauses that cover unanticipated situations that may arise during the course of construction.
These provisions come into play when a contractor comes across an issue that would require unexpected work to be done and/or increased expenses to be incurred. Under current law, if the contract contains these standard protest and claim clauses, that generally require both notice and written information to be provided within 14 days of that notices, strict compliance will be enforced.
A hearing was held on HB 1574, sponsored by Representatives Rodne and Kilduff, that would make these standard protest and claim clauses void and unenforceable. This bill would allow for a contractor to claim an issue that required unexpected work or increased expenses at any time after the contractor discovers the issue. This means that it would be possible for the contractor to claim reimbursement for an issue months or years later.
What makes this difficult for the counties is that it would not allow for counties to properly mitigate or investigate the issue at the time the issue is discovered. This is problematic because it makes it difficult for the county to determine whether the issue actually existed, whether the issue could have been resolved in a less expensive manner, or whether the issue could have been resolved via another route.
We testified in opposition to this bill.
Link to the TVW Hearing: http://www.tvw.org/watch/?eventID=2017021018