Contractors are suing the South Florida Water Management District after it terminated their contract to construct the half-billion-dollar Caloosahatchee (C-43) Reservoir in Hendry County, Fla., contending that design changes and other actions by the agency caused delays, not the firms' performance.
C43 Water Management Builders, a Lane Construction Corp.-led joint venture with its Italy-based parent Webuild SpA, filed the lawsuit in the U.S. Southern District of Florida Court against the district, charging it with wrongfully terminating the almost $524-million contract.
Sean Cooley, district communications director, says in a statement that completion of the reservoir is among the agency’s highest priorities given its significance in protecting the Caloosahatchee River and estuary, which is tied directly to the local economy.
He says the district was “forced to make the difficult decision of terminating” the contract.
“The contractor simply could not stay on schedule and would not make the necessary changes to get back on schedule or prevent further delays,” Cooley says. “The contractor averages an additional 20 days of delay for every month on the job, which would result in a project delivery upwards of two years late. Such poor performance is contrary to the contract and is unacceptable.”
The district is looking for ways to continue construction, he says, and remains committed to protecting taxpayers’ investment in ecosystem restoration projects.
“It is unrefuted that Lane has met he highest standards of integrity and excellence throughout its work for the South Florida Water Management District,” says a statement from the company. “The district’s decision to terminate our contract is unlawful and self-serving at best as it was the district, not the contractor, that caused over a year of project delays and millions of dollars of cost overruns that Florida taxpayers ultimately will have to bear.”
Contractors are seeking a declaration of wrongful termination and that the firms were not in material breach of the contract, and that the termination for default notice be rescinded, the lawsuit says, as “the District’s decision to wrongfully terminate [them] on the Project can impact its partners’ ability to obtain new work in Florida and around the United States.”
The joint venture says in its lawsuit that it worked continuously from the time of the project award, contending that it completed roughly 70% of the work, including “a substantial amount of the many new or extra items of work directed by the District that arose due to changes and modifications to more than 50% of the 959 pages of contract drawings after the contract was awarded.”
The firms say they prepared and updated a construction schedule throughout the project detailing the crucial path, and says it’s “entitled to at least 322 days of excusable and compensable delay that are the result of two major District design changes and a District failure to provide the necessary site access.”
Specifically, the lawsuit says the agency changed the elevation of the blanket drain installation for more than a mile, changed the design of a structure that “made the means and methods to perform the work much more complex and challenging,” and that the “District’s Bid Package 3 contractor fell substantially behind schedule,” leading to the agency not being able to provide adequate site access.
In July 2021, the firms re-sequenced the work and submitted a revised project schedule, which was accepted by the agency, after which the lawsuit says the project began to see “district-caused delays and impacts,” including providing hand-drawn sketches not signed by the engineer for blanket drain design changes that “were woefully inadequate for WMB,” and a claim for additional time to the District was denied.
On top of those delays, the team says the district failed and refused to grant a time extension of a single day of additional time as required by the contract. In the months leading up to the April 28 termination of the contract, the firms sas it provided schedules detailing a recovery plan which were ignored, even after multiple letters and emails it says went unanswered.
According to the lawsuit, “Instead of working with [the contractors], on April 28, 2023, the District issued a Termination … which wrongfully terminated [their] contract for failure to provide an appropriate recovery plan to meet the contractual Substantial Completion of March 8, 2024.”
It says the district only provided extensions of time for weather-related events and the COVID-19 pandemic, a total of 76 days of contract time extensions.
“We are committed to defending ourselves, and through our lawsuit, seek to hold the district accountable for their senseless actions,” says Lane’s statement.
In 2019, ENR reported the contract award, at the time the largest Everglades project the agency had awarded, a $524-million lump sum for the five-year project set for substantial completion in spring 2024.
In its press release announcing the award, the district says the 10,500-acre reservoir will store 170,000 acre-ft of fresh water, with the contract including construction of nearly 20 miles of embankments, 15 miles of perimeter canals and 14 water control structures alongside recreational features.
