Contractor Sues County for Loss of Airport Job

SANTA ANA —  The county and its chief contractor for the John Wayne Airport expansion took their feud into court Thursday as the company filed a lawsuit charging the county with breach of contract and seeking $7.2 million in damages.

In the lawsuit, filed in Orange County Superior Court, lawyers for Taylor Woodrow Construction California Ltd. also asked the court to block the county from stripping the firm of a $25-million road and parking garage contract that is eight months behind schedule. Despite last-minute pleas from the company, county supervisors unanimously voted Tuesday to fire Taylor Woodrow from that contract.

“The company believes these actions are necessary to protect its interest after it was unfairly and, we believe, unlawfully terminated on the contract,” Taylor Woodrow’s senior vice president, William Ostfeld, said in a prepared statement Thursday.

Told of Taylor Woodrow’s action, several supervisors reacted with a mixture of disappointment and outrage but expressed their confidence that the county would prevail.

“I certainly feel it was an appropriate action that we took, and nothing has changed my view of that,” Supervisor Gaddi H. Vasquez said. “The board would never have contemplated any action had we not been on solid legal ground.”

But even as Taylor Woodrow and the county prepare to do legal battle, the company continues to work on the airport’s new $60-million terminal. Both sides have said they hope that project can be completed on time, and Taylor Woodrow has agreed to an accelerated work schedule to finish the terminal by Sept. 16, when it is scheduled to open.

The project from which the company was fired involves construction of a 1,611-space parking garage northwest of the terminal and an elevated roadway that will pass in front of both the terminal and parking lot. A consultant hired by Taylor Woodrow said earlier this week that both the roadway and garage could have been completed by middle to late June.

In its suit and in an accompanying claim, Taylor Woodrow charged that delays in completing the parking structure and road are at least partly the fault of the county and its project manager, a consortium of firms known as HPV. The suit charges that plans and specifications provided by the county contained mistakes, and that the county and its representatives have hindered the project’s successful completion.

“As a result of the actions and inactions of the county and its representatives, Taylor Woodrow has incurred delays in the completion of the final project through the present date,” the claim states. “Under these circumstances, the county had no right to terminate Taylor Woodrow’s contract, and Taylor Woodrow is entitled to additional damages as a result of this wrongful termination.”

The company also argues that it was denied a proper hearing by the county and that board members had made up their minds before hearing the company’s arguments.

Taylor Woodrow’s lawyers argue that the company has suffered losses of $4.7 million in increased labor costs and other expenses that are the fault of the county and HPV. The county has also levied and withheld $2.5 million in fines for late work, which the lawsuit seeks to recover.

Even before the supervisors voted to strip Taylor Woodrow of its parking and road contract, the company had suggested that it would challenge any firing with a lawsuit. County officials were braced for Thursday’s news but nevertheless were angered by it.

“It’s an inexcusable and irresponsible act on their part,” said Supervisor Roger R. Stanton. “I can’t believe that they would seek to cause further harm to the county in the form of an unwarranted lawsuit.”

Supervisor Thomas F. Riley said he, too, was disappointed. “I really had hoped it wouldn’t come to this.”

Both supervisors dismissed the company’s allegations that delays are the fault of the county or HPV.

The board’s action Tuesday came amid revelations that Taylor Woodrow had allowed one of its state licenses, a so-called Class A engineering license, to lapse. According to lawyers for the county, that alone could make Taylor Woodrow unable to complete the portion of the contract that deals with the road.

In addition, county and other legal experts say that if Taylor Woodrow has done work on the road without the proper license, it could drastically weaken the company’s legal case.

Neither the lawsuit nor the claim addresses the issue of the license, but in a statement issued Tuesday, Ostfeld said the company has “fully complied with the licensing requirements” of the contract.

Judy Johnson, a consultant hired to act as a spokeswoman for the company, would not answer questions about the license, referring all questions to the earlier statement.

Lawyers for the county were unavailable for comment.