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Suit demonstrates costliness of construction disputes

Miami and South Florida have seen tremendous development of infrastructure over the past several years. From rail corridors and airport projects, to improved freeway and tollway systems, the region is expanding at a breakneck pace. Unfortunately, the pressures of major construction projects can lead to disputes between developers and contractors or subcontractors. And disputes may result in construction litigation, which is almost always costly.

An example of the costliness of construction litigation is the years-long dispute between the Miami-Dade Expressway Authority and the contractor it hired to install an open-road tolling system, Electronic Transactions Consultants Corp. When the tolling system failed to work as promised, MDX threw the blame at the feet of ETC, claiming that they underbid and misrepresented its abilities to undertake the project to MDX.

In 2012, ETC filed a lawsuit against MDX claiming the Authority acted in bad faith and breached their contract. This year, a judge awarded ETC $53.3 million and denied all of MDX’s counterclaims. This sum is before attorney’s fees – MDX could be on the hook for millions on both sides of the dispute – interest, and the revenues MDX claimed were lost as a result of the failed project. As a result, MDX could easily be on the hook for an amount exceeding $70 million.

Sometimes construction litigation is unavoidable, but it is almost always costly. For this reason, developers and contractors should be certain to have experienced legal representation from the outset of any project. Seasoned construction lawyers can ensure that contracts are solid, help negotiate as circumstances change over the course of a project, and if things head south, go to bat for their client in court.

Source: Construction Dive, “Miami-Dade judge awards Florida-toll road contractor $53M,” Kim Slowey, Feb. 13, 2018

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