On July 25, 2024, Rebecca Pearson and Christopher Griesedieck published, “Can you cap that? Subcontract damages cap might not stick” in Federal News Network. The following is an excerpt:
Contractors and subcontractors should review their agreements to ensure that any limitations on liability (caps on the amount of damages available in litigation) are enforceable in the aftermath of the Western District of Virginia’s recent decision prohibiting caps on damages for changes in BAE Sys. Ordnance Sys., Inc., v. Fluor Fed. Sols., LLC.
What happened in the court case?
The case involved a prime-sub dispute under a subcontract for the design and construction of a production facility for the Army. The prime contractor, BAE, argued that the subcontractor Fluor’s delays breached the subcontract, requiring BAE to compensate the Army. Fluor argued that BAE breached the subcontract by directing the changes, while refusing to equitably adjust the subcontract price upward by $183 million, as required by the subcontract’s changes clause.
Click here to access the article. If you are unable to access the article, please contact the Library.