Drywall Subcontractor May Be Ordered to Pay $3 Million in Court Costs

A construction company that lost a lawsuit several months ago may be on the hook for millions more dollars. The surety company that was part of the civil lawsuit now wants to be reimbursed for attorneys’ fees and trial costs.

Suffolk Construction lost a breach of contract lawsuit against its surety company, Berkley Insurance Co., in July. The contractor already owes $4.1 million in damages. That number may increase to more than $7 million if the presiding U.S. district court judge in Miami allows the surety to collect $3 million more for having the foot the cost of going to court.

While Florida and most other states require each side in a civil lawsuit to pay their own attorneys’ fees and court costs, Florida also makes an exception if there is a contract or state law that allows the winner to recover those costs.

Determining the winner in a civil lawsuit isn’t always easy, though, because there are often several different claims involved and it’s possible that a party could win some but not others.

One way to collect attorneys’ fees is if the plaintiff explicitly seeks the fees and if the judge decides that one of the parties prevailed on most issues.

The lawsuit between Suffolk and Berkley was the culmination of a five-year dispute over the Met Square Project. Drywall subcontractor Titus Construction Group said it was owed multiple payments by Suffolk. In July, the federal judge in July ordered Suffolk to pay Berkley $4.1 million plus $1.2 million in interest.

A surety that indemnifies a contractor can make claims for the contractor and collect any money due while seeking to recover its own costs. However, attorneys for Suffolk claimed that Titus Construction was insolvent.

In 2019, Berkley had sued Suffolk for breach of contract, claiming the contractor owed money to Titus for the Met Square Project. A nonjury trial in November 2023 sided with Berkley, with the judge citing a lack of evidence about disputed schedules from Suffolk.

Berkley now seeks $2.1 million for attorneys’ fees and expert witnesses, on top of the damages and interest. Berkley seeks additional costs as well, including $501,000 for expert witness testimony, plus Titus is asking for an additional $391,000 for “database services” related to producing necessary court documents, as well as another $15,000 for technology needed to manage the case and documents, and another $15,000 more for the travel costs of attorneys and witnesses.

Titus’ subcontract with Suffolk required the sub to pay attorney and trial costs if the contractor prevailed. However, Florida statutes require that any contract with that one-way provision automatically is interpreted as a two-way obligation. Berkley claims it is entitled to the court costs and attorney fees. A final ruling from the judge on the ultimate court costs may still be months away.

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Contracts need to be followed, and when there are multiple parties involved, there is bound to be some confusion. Plus, state laws can dictate the course of action.

What are your responsibilities as a contractor? Get the help you need from a Florida construction contract lawyer from Linkhorst Law Firm. Contract issues can lead to delays, cost issues, litigation, and more. Fill out the online form or call 561-626-8880 to schedule a consultation.

Source:

enr.com/articles/59599-suffolk-construction-drywall-suits-involve-claim-for-3-million-in-court-costs