Construction / Commercial Litigation / Business & Employment Law

Woolford Kanfer Nets Huge Victory for Lancaster GC

Woolford Kanfer Law scored a major victory in September for a general contractor, Lancaster’s Caldwell, Heckles & Egan (CH&E). A Lancaster County judge ruled, after a 3-week trial, that CH&E was entitled to payment of nearly $600,000 which an owner/developer had wrongfully withheld from it at the conclusion of the project. The lawsuit involved Lancaster’s Bistro Barbaret & Bakery and Altana Lounge in downtown Lancaster. The opening of the restaurant, bakery and lounge received considerable publicity when it opened in 2015 in part because the chef de cuisine, Cedric Barbaret, relocated to Lancaster from Philadelphia where he worked at the Starr Restaurant Group’s famed restaurant, Buddakkon. The building also features a popular lounge and rooftop bar. The owners had set up a company to own the property and develop the building. Woolford Kanfer argued that in addition to the company being liable to pay the money, the three owners should also be personally liable to CH&E because the company intermingled corporate and personal funds, failed to observe corporate formalities and was undercapitalized. Judge David Ashworth determined that fairness and justice required the individual owners of the partnership be held personally liable to CH&E. This is the second case in which Woolford Kanfer has successfully pierced the corporate veil in a construction dispute.

The owners had withheld payments from CH&E at the end of the project claiming that CH&E did not complete the building on time and accused CH&E of charging extra for things that were required under the base contract. The owners argued that CH&E was responsible for late completion penalties of over $350,000. The judge ruled that CH&E was not responsible for project delays because the owners made many changes during the project and failed to make timely decisions. The owners and the architect they had hired, Cox & Evans, signed over forty (40) change orders during the project in which they agreed to increase the contract price and extend the completion date. At trial, the owners argued that the change orders were invalid and that they should not have to pay and that the extensions should not be recognized. The judge rejected those arguments and ruled that all of the change orders were enforceable.

After the verdict, CH&E submitted a request to add attorneys’ fees as well as interest and penalties under the Contractor and Subcontractor Payment Act. The owners agreed to pay the verdict, plus a substantial amount of the attorneys’ fees and Payment Act damages concluding the matter.