Law Office of Paul H. Appel Recovers $900K Award for Maintenance Company in Breach of Contract Arbitration

A client entered into a $1.5 million subcontract initially to perform a significant restoration to a major transportation hub and thereafter to conduct monthly maintenance services. The client asked for a long-term contract so that it could pay down the significant upfront restoration costs over a period of time. Monthly payments were established at $23,000 to cover the cost of maintenance and the extended payout for the restoration work. The contract was extended to 4 years and 9 months.

The restoration work was successfully completed and the maintenance thereafter commenced. All work was going along well at its normal pace when, without any warning, the contractor terminated the contract, and our client sued. The client was replaced with another maintenance contractor that charged $6,500 per month less because it was not charging for the restoration work. This financial savings shows a clear motive for the termination.

The defense relied upon communications from people concerning issues that arose throughout the course of maintenance. The argument was that the maintenance was improperly performed, so the contract had to end. Supervisors testified that the client had done a terrible job and deserved to be terminated.

The challenge was to counter the testimony of the supervisors as blatantly false. Through extensive analysis and use of documentation, which revealed glaring contradictions in the witnesses’ own testimony, our firm succeeded in demonstrating a pattern of inconsistent statements and conduct. One witness even testified that he would say that work was satisfactory even if it was not. In short, he admitted — under oath — to being a fraud. Such moments win cases.

At the arbitration hearing, we were able to conclusively discredit the defense. The arbitrator awarded the client an amount above $900,000 which was the balance due on the contract after deducting the expenses that would have been incurred had the contract not been terminated. This award shows that perseverance and legal competence win cases.

This was another win for Paul H Appel PC.