Deductive Modification
CaliforniaWe were a subcontractor on a federal project, our client (the general contractor) hadn't paid us our final payment in now over 120 days. We just received a partial payment from them as well as a "deductive MOD" to our contract in which the deductions they are stating are not plausible. How do we proceed in getting paid? Should we file a miller act on payment bond or what legal options do we have? Thanks
2 replies
Your primary options for collection are going to be through your contractual remedies and through the payment bond. You have one year after the last day on which you provided labor or materials to the project to make your bond claim. So it may make sense to attempt to resolve the dispute without making a claim on the bond if you have time. Check the dispute resolution procedures in your contract and follow those. If no such procedures exists, I generally recommend a demand letter setting forth the reasons that the direct contractor's position is erroneous. This can be more effective coming from an attorney. If the demand letter fails to elicit the desired response, you would move forward with the bond claim, and if necessary litigation after that.
If you have further questions email me at ryan@huntortmann.com to set up a free telephone consultation.
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Yes, file a Miller Act claim. There is a lot to it. You may want to google: 40 U.S.C. § 3133 to get a feel for the process . If the sum is large enough, find a constructin lawyer in your area that has pursued these types of claims. Good luck.
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