Contractor claims fraud on Maine mixed-use development
- Vermont-based PC Construction Co. has sued the developers of a Portland, Maine, mixed-use development for $235,000, claiming they engaged in fraudulent activity and have withheld payment for services the contractor rendered, according to the Bangor Daily News. The federal suit names Miami-based developer The Federated Cos. and owners Jonathan Cox and Nikolas Wexler, who also operate through several limited liability corporations, as defendants.
- PC Construction alleges that it performed preliminary work on the 3.2-acre midtown project beginning in 2013. It agreed to provide those services for free, company officials claim, as long as the developers selected PC Construction to build the project. Since construction has not started, PC Construction said it is entitled to payment for its services. Lawyers for Cox and Wexler argue that the suit "lacks merit" and that payment to the contractor is due only if construction is performed without the company's involvement.
- The PC Construction lawsuit also alleges that the developers were not honest about who actually owns the property, leading the contractor to file its initial lawsuit against an LLC that was no longer in business. Meanwhile, the developers said they would appeal a city of Portland decision to deny the issuance of building permits for the project and that they are considering a lawsuit against the city.
Diplomacy and the patience to work out disagreements before they become a matter for the courts are traits that can save contractors, developers and other construction industry players from having to pay big legal fees — but some issues seem destined to end up in court.
For example, New York City developer Related Cos. has filed two lawsuits against trade unions during the past few months, the last one alleging harassment of and interference with nonunion concrete contractors and suppliers for a project underway at the $25 billion Hudson Yards development in Manhattan.
And tensions were already high between union and nonunion factions when Related filed its first lawsuit in March alleging that it objected to certain trade unions that the Building and Construction Trades Council of Greater New York was trying to include in a new project labor agreement for Hudson Yards.
Related said that while it had no problem with the majority of unions working at the project, some had managed to squeeze the developer for $100 million due to questionable work and billing practices. The tone of public comments from both Related and union representatives don't indicate that the two are willing to work out their differences outside of a courtroom anytime soon.
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