Atlanta lawyers helped a construction company win a major victory last month at the Alabama Supreme Court. The court’s 8-1 ruling kept a Gadsden construction company and its insurer from being held responsible for tens of millions of dollars in cost overruns for a project on which the city of Huntsville terminated the company “for convenience,” then later tried to change to a “for cause” termination.
The distinction over why Dawson Building Contractors, represented by Weinberg Wheeler Hudgins Gunn & Dial, was terminated from the contract was important. A firing “for convenience” would not trigger a $24 million performance bond the company took out with St. Paul Fire and Marine Insurance Co. A firing “for cause” would have triggered the bond-and could have led to litigation between St. Paul and Dawson, which had an indemnity agreement with the insurer, said Nicholas P. Panayotopoulos of Weinberg Wheeler.
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