Electrical Subcontractor’s Claim Short-Circuited by Executed Final Waiver and Release of Claims
An electrical subcontractor performed work on a government project.
An electrical subcontractor performed work on a government project. When the project was complete it executed a Final Waiver and Release of Claims in exchange for final payment from the general contractor. The Final Release waived and released “any claims for payment against [the contractor] . . . which might accrue under either state or federal law by virtue of the labor, equipment and/or materials furnished for the Project.” Seven months later the subcontractor filed a Demand for Arbitration seeking $400,000 for claimed delays and changes on the project.
In response to the Demand for Arbitration the general contractor, who was represented by Karl Berg, immediately moved for Summary Judgment based on the broad language in the Final Release. The arbitrator, a retired federal judge, turned out the lights on the electrical subcontractor’s claim by concluding that under the Final Release the subcontractor had unequivocally waived all claims it may have had against the general contractor. As such, the subcontractor’s claim was dismissed. Under the Subcontract, the general contractor was awarded its attorney’s fees and costs providing it some redress for having to defend against a claim which never should have been asserted against it.