Extreme Construction Co. v. RGC Glenwood, LLC and Mike Spradlin, 2012COA220 (December 27, 2012)

Ambiguity keeps lawyers employed. In this case, a construction contract had an ambiguous “Cost/Plus” price provision that “included, without limitation” “wages [of] construction workers directly employed.” Owner believed the price was limited to the actual cost of wages. Builder believed “costs” referred to fixed wage rates that included unemployment insurance, workers’ compensation, and other expenses. Owner did not object to Builder’s interpretation until after litigation arose. The court of appeals held that Owner was estopped from arguing his interpretation was correct because he had full knowledge of the facts, unreasonably delayed, and Builder detrimentally relied on Owner’s delay. This was the first time a Colorado court applied the equitable estoppel doctrine to the interpretation of an ambiguous contract. It was remanded to recalculate damages.

http://www.courts.state.co.us/Courts/Court_Of_Appeals/Opinion/2012/12CA0084-PD.pdf

http://www.cobar.org/opinions/opinion.cfm?opinionid=8788&courtid=1

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