ASA Files Papers as ’Friend of the Court’ in Tennessee Lawsuit

Tue January 21, 2003 - Southeast Edition
CEG



The American Subcontractors Association Inc. (ASA) moved aggressively on Nov. 6, 2002, to protect Tennessee’s construction subcontractors by filing court papers as an “amicus curiae,” or “friend of the court,” in a lawsuit that will very likely determine the balance of power in all change order disputes decided under Tennessee law.

ASA, together with ASA-Middle Tennessee and ASA of West Tennessee, filed the brief with the Tennessee Court of Appeals in the case of Amprite Electric v. Tennessee Stadium Group. An “amicus curiae” is a person or entity that is not a party to a case, but believes that the outcome will set a legally binding precedent that affects its interests.

The original lawsuit was initiated by a subcontractor that was never paid for extra work outside the scope of the original contract. The general contractor ordered the extra work, but refused to pay for it on the grounds that it had never provided the subcontractor with written change orders. While ASA believes that the general contractor “waived” the requirement in the contract for written change orders, a Tennessee anti-waiver statute provides in many cases that contractual terms cannot be waived unless they are waived in writing. ASA believes that the anti-waiver law was never meant to apply to construction, and that other legal theories support the subcontractor’s right to be paid for the extra value it added to the project.

ASA’s Subcontractors Legal Defense Fund (SLDF) is funding ASA’s involvement in the appeal, in hopes that a victory for the subcontractor will add to the legal arguments supporting subcontractors across the country seeking payment for extra work. ASA believes that the Amprite case may have far-reaching implications for payment practices.

ASA’s brief states, in part, that change order provision “have been used as a weapon by general contractors to deny or delay payment to subcontractors who do the work but, in the interest of teamwork and job progress, do not obtain written change orders before doing the planning and drawings in advance of beginning work.”

One of the keys to the subcontractor’s legal victory at trial was the meticulous project documentation performed by the staff on the project. Based on the documentation and courtroom testimony, the trial court found that the legal principles of “implied contract” and “estoppel” were applicable, notwithstanding the Tennessee anti-waiver law, and entered a $1.2-million judgement in favor of the subcontractor, Amprite Electric. The trial court determined that Tennessee Stadium Group had abandoned the established change order procedure. The court found that by encouraging Amprite Electric to continue work. Tennessee Stadium Group’s actions were contrary to the argument that the work was not authorized. Tennessee Stadium Group is appealing the decision.

Philip Jones, an attorney with the Nashville law firm of Evans, Jones & Reynolds, represented Amprite Electric in the trial court victory over Tennessee Stadium Group, the construction management partnership in charge of the Adelphia Coliseum project. ASA retained Nashville attorney Todd Panther of Tune, Entrekin & White, P.C., to prepare ASA’s amicus curiae brief.

ASA’s Subcontractors Legal Defense Fund supports ASA’s critical legal activities to protect the interests of all subcontractors, and is funded solely by contributions. SLDF funds are invested to defend subcontractors in precedent-setting cases.

For more information, visit www.asaonline.com.