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Monthly Archives June 2012

Smith, McDowell & Powell Hits the Ground Running

The SMP team didn’t waste any time making a name for their new firm.  Within weeks of opening, SMP successfully recovered nearly $100,000.00 for a client on a bond claim, nearly $400,000.00 on behalf of a client in a breach of contract dispute, and on the defense side, helped a client divert nearly $100,000.00 in liability.  Momentum is a precious commodity and SMP will not be squandering it.

Stay tuned for other exciting updates regarding SMP’s legal and philanthropic presence in the region.

  Smith, McDowell & Powell   Jun 29, 2012   Blog   Comments Off on Smith, McDowell & Powell Hits the Ground Running   Read More

The Biggest Public Works Project in Northern California

SMP is no stranger to the drama that can occur on public works projects, but all the stories being reported by the Sacramento Bee on the structural integrity of the new Bay Bridge is enough to make even us cringe. The Sacramento Bee has been releasing details of its investigation for several months now, but it appears some authorities are now recognizing some important steps were “skipped” on this project which is scheduled for completion in or around Labor Day 2013.

In short, the Sacramento Bee reports that the builder of the new Bay Bridge failed to disclose that a section of concrete in the foundation of the bridge’s signature tower had not hardened before it was tested. By circumventing this step, the builder was allegedly able to proceed with work without further inspection or delay.  It is unclear to the public what exactly happened, but a Department of Transportation technician responsible for the testing was allegedly put on administrative leave and further testing may be required on the piles which hold up the bridge.  Regardless, this incredibly political project appears to be wrought with issues, inevitably as a result of the substantial public safety concerns as well as the estimated $6.5 billion sticker price.

While we have no doubt that the public safety concerns will be addressed in due course, the implications of the recent scrutiny are very serious for any contractor who had their hand in this project.  It is unclear whether the project is off critical path and scheduled to be completed on time, and the contractors do not have an easy road ahead of them.  With the political pressure and media magnifying glass on this project, there will be more thorough testing and inspections, which may delay the project…and every contractor knows that delay on public works projects means liquidated damages, at least in California.  Regardless, even if this project goes according to plan from here on out, the problems that have come up highlight a bigger issue.  Mainly, that public works projects are not as “stable” and “predictable” as people may think.

Given that inspections and oversight are pervasive on public works projects, we do not usually run into too many situations where public safety concerns get in the way of closing out our client’s projects. What we usually see is governmental agencies under political pressure to save costs, and to utilize funding effectively, which results in the contractors ending up on the losing financial side.  Unavoidably, change orders are usually required on public works projects, whether additive or deductive, and the contractors can safely assume state agencies will do everything possible to cut costs.  The key for contractors and subcontractors is to take proactive measures to ensure they receive payment for the work they perform.  Contractors must pay close attention to the project schedule, critical path, their scope, the specifications, and the contract procedures. Nearly every aspect of the project needs to be documented, and the proper approvals and inspections must be obtained. It is also critical to have internal procedures in place to preserve claims for payment, otherwise contractors may find themselves without recourse.

SMP can help contractors navigate through the complex public works world.  If you are a general contractor or subcontractor who requires any type of assistance with public works projects, please contact us.

  Smith, McDowell & Powell   Jun 05, 2012   Blog   Comments Off on The Biggest Public Works Project in Northern California   Read More
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