MRT Construction Inc. v. Hardrives, Inc.

In May 1986, the U.S. Department of the Interior, Bureau of Reclamation (“BOR”), awarded Hardrives, Inc. (“Hardrives”) a contract to construct a canal in Arizona. The contract incorporates the Contract Disputes Act, 41 U.S.C. §§ 601-613 (“CDA”). The contract terms allow Hardrives to pursue claims ^gainst the government for government-caused delays and errors, but also require Hardrives to complete the canal project on time without regard to any government, error or misconduct.

In June 1986, Hardrives and MRT Construction, Inc. (“MRT”) entered into a subcontract for specified work on the canal, including a major portion of the earthwork on the project. The subcontract requires MRT to complete its assigned work on schedule without regard to government errors. Further, under the subcontract, MRT is not entitled to payment for any work unless and until the government pays Hardrives.

The government furnished Hardrives with plans and specifications for the canal project. These plans and specifications contained several defects. MRT claims these defects caused it significant delays and cost overruns. On April 9, 1987, MRT demanded payment from Hardrives for increased costs. Hardrives…