Southeast Construction News
Flatiron $42M Suit: SCDOT Delayed Project, Breached Contract
Flatiron Constructors is suing the South Carolina Dept. of Transportation and Horry County in an effort to recoup $42 million in damages it says were incurred thanks to delays and mismanagement on SCDOT's part that amount to a breach of contract.
Illustration by Scott Hilling/ENR, original elements courtesy of Getty Images
Flatiron Constructors is seeking $42 million in damages from the South Carolina Dept. of Transportation (SCDOT), alleging that state mismanagement and foot-dragging on a project in Horry County caused the contractor to miss its initial deadline and incur millions in costs that it says amounts to a breach of contract.
TheBroomfield, Colo.-based Flatiron Constructors entered into a contract with the state to build the four-mile extension to South Carolina Highway 31, a main bridge over the Intracoastal Waterway, six minor bridges and other associated road work, according to a lawsuit filed in a Horry County court on Nov. 1.
The state issued its notice to proceed in February 2014 with the initial requirement for substantial completion in 1,220 days, or about 40 months, meaning the initial deadline would have been in 2017. Work was completed on Nov. 7, 2019, according to the suit.
The contractor's suit alleges that the state delayed the project beyond the contract’s mandated completion date, but “did not establish a new completion date and continued to assess liquidated damages against Flatiron”—at a daily rate higher than the amount permitted by the contract.
Pete Poore, agency spokesperson, declined comment on the pending litigation.
The complaint says South Carolina did not comply with terms of that contract, and caused Flatiron to incur significant damages because it “hindered Flatiron’s ability to complete the project by, among other actions and/or inactions, not adhering to specification-imposed and industry standard deadlines, instituting unreasonable inspection protocols, directing unreasonable and extra-contractual changes to Flatiron’s means and methods, and providing inadequate project personnel to administer and oversee the project.”
Specifically, Flatiron says the state failed to review its drilled shaft installation plan submittals by the specified deadlines, extended other work on the main bridge through “excessive oversight, maladministration and overzealous inspection of the bents, specifically related to approving the drilled shafts.”
According to the lawsuit, Horry County, SCDOT and the South Carolina Transportation Infrastructure Bank agreed to finance the project and in 2007 passed a resolution stating that the highway agency "will assume the primary responsibility for various aspects of the project.”
The lawsuit details at least 10 ways the agency slowed the project, including requiring Flatiron to perform additional work beyond the scope of the original contract, delaying other reviews and approvals, and not removing a subcontractor’s personnel “who repeatedly impeded Flatiron’s progress.”
The lawsuit also details the state requiring repair of misaligned anchor bolts during a concrete pour that was “radically different than the standard procedure for such items and came at great expense to Flatiron and caused delay to the project.” The suit also notes other factors that slowed the project, including floods from an October 2015 hurricane that continued into the spring of 2016.
“The state’s actions and/or inactions complicated and prolonged Flatiron’s work, and delayed the project ... subjecting [the firm] to increased costs and delay damages,” the lawsuit states, alleging the state also refused to grant firm requests to extend its contract.
As a direct result of those actions, which the lawsuit says constitute breaches of the contract, Flatiron incurred direct costs, time-related costs and other damages totaling more than $42 million.
