We have a situation where the Electrical Contractor has gone under and failed to complete a government project. We are a material supplier who sold materials to the Electrical Contractor on terms and we are looking at taking a significant loss. We have "controls" to ship that would finish the project but we are refusing as its leverage to get paid. This is a Government job so there was a bond issued. We are "filing" a bond claim. The GC is getting wacked with fees from the government because they are late completing the project. Can the General Contractor claw back money / fees that the government has assessed them for not completing the project on time from the material supplier (my company) who is holding back the final controls needed to complete the project as we work through the bond process to ensure we will be made whole. The GC wants to pay for the controls themselves to complete the job and therefore reduce our bond claim. I'm not comfortable at all with that and am looking for some guidance.
This is a situation that happens and, as you identified, requires specific guidance tailored to the specific situation. Most construction disputes are manageable and can be negotiated without the need for a lawsuit. Sources estimate greater than 92% of all cases filed settle before going to trial. Please contact me directly if you would like additional guidance.
Steve Schinker, Essential Counsel / 303-319-2924