Conam Alaska v. Bell Lavalin, Inc.
842 P.2d 148 | Alaska Supreme Court | 1992
What This Case Means for Subcontractors
Conam Alaska, a subcontractor on a North Slope project, sued Bell Lavalin for breach of contract and professional negligence. The court ruled that Conam's failure to perform was excused because Bell Lavalin breached its duty to grant a time extension. While the jury awarded contract damages to Conam, the court rejected the professional negligence claim due to insufficient proof of causation. The key lesson: a prime contractor cannot terminate a subcontractor for nonperformance if the prime itself caused the delay through breach.
Key Takeaways
- •Document all requests for time extensions in writing. If the prime denies or ignores your extension request, you have a defense against termination for delay.
- •Contract damages are easier to prove than professional negligence damages. Focus on quantifying direct losses (labor, equipment, overhead) rather than pursuing negligence claims.
- •A 'total breach' is required to justify termination. Partial breaches or isolated failures do not give the prime the right to terminate your subcontract.
Termination is justified only in the event of a total breach.
Frequently Asked Question
Can I be terminated for missing a deadline if the prime contractor refused to give me a time extension?
No. If you requested a time extension and the prime contractor breached its duty to grant one, your nonperformance is excused. You may also recover contract damages. However, you must document the request and the prime's refusal in writing to prove this defense.
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