Lawsuit Against Marshall Board of Education Continues

MOUNDSVILLE – A lawsuit filed earlier this year against the Marshall County Board of Education regarding construction of the new Cameron High School now includes a second company and involves more than $2 million in damage claims against the board.

The original suit, filed Jan. 25 in Marshall County Circuit Court by Nello Construction of Canonsburg, Pa., and its subcontractor, Cost Co. of Pittsburgh, deals exclusively with the construction of Cameron High School. The construction of the new school was delayed several times for various reasons, finally opening more than a year behind schedule and a half-million dollars over budget.

The lawsuit outlines the relationship between Nello Construction, which served as the project’s general contractor, and Cost, which was subcontracted to perform labor and furnish materials and equipment to be used to complete concrete, masonry, brick work, insulation and sheet metal at the building.

According to contracts entered in May 2010, Nello was to be paid $15.9 million, while Cost was set to be paid $2.37 million. Cost’s work was scheduled to be completed in 131 days, according to the complaint.

However, the lawsuit alleges “due to the conduct of Marshall (County Schools) and its agents,” the work was significantly delayed and interfered with, causing the project to take longer than expected. In recognizing the delays, school officials requested Cost “accelerate” its work by adding more masons to the project, and an additional payment of $136,689.16 was made to Cost for work through Nov. 18, 2011.

According to the lawsuit, the project acceleration and use of more masons was agreed to with the provision the district would schedule and expedite the work of other contractors on the project. The lawsuit alleges, however, that the district did not properly address scheduling, preventing Cost and its workers from performing the tasks at hand.

According to the lawsuit, by the time Cost had completed its work in September 2012, the productivity and inefficiency damages had reached in excess of $1 million, cause solely by the board’s actions.

Board Responds

In March, the board filed a counterclaim against Cost, asking for the original claim to be dismissed. While acknowledging that the project experienced delays, the counterclaim states the board made payments to Cost for the extra work, and also paid for a crane for an additional seven weeks and winter weather protection to ensure work could continue. The board alleged it paid $2,371,500, which was a “firm, fixed price” for all work.

The board charges that Cost “grossly undermanned” the project and was not productive when on site, which caused the project to be delayed further. Additionally, the claim states Cost failed to coordinate and communicate with other prime and subcontractors.

The board also includes a third party, Scalise Industries Inc., in its counterclaim. As part of a $3.3 million contract, the board asserts Scalise failed to perform work on the HVAC system at the cost and in the time frame set forth in the contract documents, which also delayed completion. The filings state if the board is found liable to Cost, the liability should be “passive and secondary” to the liability of Scalise, who should then pay the damages.

Cost, Scalise Respond

Cost responded to the counterclaim March 26, stating the $2,371,500 was not a firm price, and that change orders were not just to add manpower.

It reasserted that the delays were caused by the board’s own conduct in handling the project.

Scalise filed an answer to the allegations on April 17, denying all allegations and stating, “the contract speaks for itself.” That contract is the basis for the company’s counterclaim, which states the board, “grossly undermanned the project and did not achieve proper productivity.”

According to the claim, Scalise entered into a contract in May 2010 to perform HVAC work at the school, which it did according to what was outlined in the contract documents. However, the counterclaim points out several other potential causes for the delays in the project, including:

– the late erection of the structural steel and anchor bolt problems

– lack of an updated and coordinated project schedule

– winter weather and other working conditions which were significant because the building was not properly enclosed in a timely fashion

– incomplete and “unbuildable” contract documents, design and engineering drawings that contained errors and omissions and were not fully completed

– blocked access to the project site and lack of proper dewatering

– incomplete and inaccurate slab openings, roof penetrations and wall openings

– improper managing, supervising, directing and monitoring of the project and prime contractors

Scalise also claims the board directed the company to perform work that was the responsibility of the board without offering additional compensation.

That work included additional piping and ductwork for the chilled beam HVAC system at the school.

According to the suit, some of that work could not be completed because the routing outlined in the building design conflicted with other systems and building components.

Additionally, Scalise states the original design called for the HVAC system to be exposed in some portions of the building. However, after seeing some of that work completed, the board asked the firm “to make major changes to the chilled beam piping arrangement in a manner different from what was shown in the contract documents.”

Those errors and changes caused Scalise to add an estimated $2 million or more in additional labor and materials. That does not include work on an additional cooling tower, which Scalise was asked to do.

The suit states the board promised several times to review the change orders and payment requests “in the near future,” but has yet to do so.

The board responded to Scalise’s suit May 8, denying all allegations and claiming it is not obligated to pay Scalise any additional money.

The filing also asks for the counterclaim to be dismissed for improper venue and lack of jurisdiction.

As of last week, no further documents had been filed in Marshall County Circuit Court, though officials connected to the proceedings said all parties are currently involved in the discovery phase of court proceedings.

No time frame has been given for resolution.