Opinion ID: 484963
Heading Depth: 2
Heading Rank: 1

Heading: Arundel's Claim Against Lar

Text: 7 Arundel asserts claims against Lar for both the liquidated damages assessed by the Corps of Engineers and the increased overhead costs allegedly resulting from Lar's delay. Further, Arundel sought indemnification from Lar in the event Control prevailed on its Miller Act claim against Arundel. We analyze each of these claims in turn. 8 1. Liquidated Damages--The prime contract between Arundel and the Corps of Engineers required the project to be functionally operational by January 18, 1982, and further provided for liquidated delay damages of $520 per day. As noted above, the project was not deemed functionally operational by the Corps until June 3, 1982, and thus Arundel was assessed liquidated damages of $70,720. Arundel charges that as the delay was caused by Lar or Lar's supplier Control, Lar is liable for this amount. 9 However, two crucial findings of the district court render Arundel's contentions on this point meritless. First, the court found that the project could become functionally operational without the SCADA system, and thus any delay in the completion of the SCADA system had no effect on the date the project became functionally operational. Second, the court found that neither Lar nor Control did anything on the project after January 18, 1982 that would have affected the project's functionally operational status. As there is evidence in the record to support these findings of fact, we cannot say that they are clearly erroneous. See Glass v. Petro-Tex Chemical Corp., 757 F.2d 1554, 1559 (5th Cir.1985). Once these findings of fact are accepted, the district court's conclusion that neither Lar nor Control was responsible for the delay in the project's becoming functionally operational must also stand, and thus Arundel cannot look to Lar for the liquidated damages assessed by the Corps. 3 10 2. Overhead Damages--The district court also found that, as a result of the delay in completing the SCADA system, Arundel incurred increased overhead expenses. However, the court found that Arundel was the real culprit whose actions caused the damages from the delay, because Arundel did not request an extension of time from the Corps after issuance of the C-21 change order. Arundel challenges this conclusion on the grounds that the subcontract, as a matter of law, made Lar liable for all losses or damages caused by Lar's untimely performance. 11 We agree. Under the subcontract, 4 it was incumbent on Lar to request any extension of time needed for the C-21 changes affecting Lar's responsibilities. See Sime Construction Co. v. Washington Public Power Supply System, 28 Wash.App. 10, 621 P.2d 1299 (1981). Whatever rights Lar may have had to an extension of time were waived when Lar failed to make a timely written request for an extension, and when Lar signed the C-21 change order without reservation. The district court expressly found that Lar's failure to give Control prompt notice to proceed with C-21 caused a delay in the completion of the SCADA system. Lar's untimely performance falls within the scope of the subcontract's delay damages provision. 12 While the district court found that Arundel had suffered increased overhead costs as a result of delay, it made no findings regarding the amount of such damages or delay attributable to Lar's actions. We therefore remand these issues to the district court for further findings. 13 3. Indemnification--Arundel and its sureties also sought indemnification from Lar in the event that Control prevailed in its Miller Act claim. This portion of Arundel's cross-action was summarily dismissed when the district court ruled that Lar was not in breach of the subcontract. 5 As the contract unambiguously requires the subcontractor to indemnify Arundel for all damages, legal and other expenses attributable to the subcontractor's work, we reverse that portion of the district court's judgment denying Arundel indemnification from Lar. 6