Dive Brief:
- Connecticut developer and contractor River Bank Construction LLC has filed a $2 million lawsuit against the city of New London, CT, and its development agency for breach of contract and costs it allegedly incurred for a $20-million, 104-unit residential project prior to being terminated, The Day reported. River Bank is also suing for punitive damages and legal fees.
- River Bank claims that the city and agency Renaissance City Development Association (RCDA) owes nearly $85,000 for building permits for the "Village on the Green" project, originally scheduled to start in 2013.
- The developer is also asking for reimbursement of $1.8 million for expenses required by the development agreement, a $150,000 commitment deposit, mobilization expenses and costs associated with hiring a construction manager and executed site work contracts.
Dive Insight:
River Bank alleged that the RCDA did not turn over the project’s 6.5 acres to them, as the signed contract required, because of a financing disagreement. River Bank said that when they did not supply "cash performance bonds, letters of credit or some forms of personal guaranty," which it claimed were not required in their agreement, the RCDA terminated the developer for being in default of the contract.
Connecticut has performed roughly $80 million of infrastructure improvements in New London’s Fort Trumbull area, where the Village on the Green project is located, but the city has encountered a series of obstacles to achieving its development goals for the area, including a lengthy eminent domain fight, according to The Day.
River Bank’s owners, father and son Irwin and Robert Stillman, told The Day that their treatment at the hands of the city and the RCDA was "a terrible injustice." On the other hand, City Attorney Jeffrey Londregan told The Day that he is confident the city will win its case. "In my first review of the complaint, the claims, as they pertain to the city, appear meritless," he said.
Another dispute between a contractor and public officials is currently underway, with the high-profile dispute between Skanska-Hunt and the Washington State Convention Center. The WSCC’s project management company Pine Street Group terminated Skanska-Hunt last in March. Skanska-Hunt filed suit soon after to block the WSCC from hiring another contractor, and this week a judge ruled to send the case to trial.