Airport Files Two Lawsuits against Park County Construction Company

Airport Files Two Lawsuits against Park County Construction Company

The Southwest Wyoming Regional Airport Commercial Terminal is one of the projects mentioned in two lawsuits. SweetwaterNOW photo by Stephanie Thompson

ROCK SPRINGS — The Rock Springs-Sweetwater County Airport Board has filed not only one, but two lawsuits against Sletten Construction of Wyoming Inc., claiming their inability to complete both the Commercial Terminal and Snow Removal Equipment building projects in a timely manner and on the agreed upon budgets is costing them even more money.

Both of the lawsuits have been filed in the Third District Court of Judge Richard Lavery. The first lawsuit for the Commercial Terminal Project was filed back in December of 2022, however an amended lawsuit was then filed on February 1, 2023. The second lawsuit for the Snow Removal Equipment building project was filed on May 18, 2023. The Commercial Terminal Project lawsuit is making its way through the court system and a jury trial has been scheduled to take place on October 2.

Both lawsuits are asking for the court to rule in the Airport Board’s favor and hold Sletten Construction to the original terms of the contract agreement between the Board and the company.

Advertisement - Story continues below...

The Commercial Terminal Project Lawsuit

According to the complaint, the Commercial Terminal project was projected to cost around $14 million and is being paid through Federal Aviation Administration (FAA) and the Wyoming Department of Transportation (WYDOT) grants. Sletten and the Board entered into a Construction Manager at Risk Agreement (CMRA) governed by a Guaranteed Maximum Price (GMP) related to the project.

The complaint states that the GMP required Sletten to complete the project at or below the GMP, which caps the Board’s financial liability under the contract and Sletten assumes all the risks of the costs of construction exceeding that price. This price can be increased or decreased based upon procedures outlined in the contract, including changing the scope of work through change orders.

In April of 2021, Sletten submitted a GMP of $15,237,314 for the terminal project and Board representatives asked if any other changes would need to be made. No one from Sletten responded, so the number was accepted. The Board claims Sletten entered into the CMRA knowing that “if the GMP is exceeded, the CMRA shall be responsible for payment from its own resources with no contribution from the owner of the difference between the actual price and the GMP as adjusted by change orders if any.”

On more than one occasion the Board claims it asked Sletten if it would need to pursue additional funding for the project in excess of the April 2021 GMP, and the Board was allegedly told by the company that it would complete the project for that amount or less.

The project was also supposed to be completed by December of 2022 or January of 2023. However, the project is now more than six months behind schedule and may not be completed until late fall of 2023.

More than a year into construction, Sletten provided the Board with an amended GMP in September of 2022 in the amount of $22,339,261, which is more than a $7 million increase. The Board rejected the amendment. During this time, Sletten submitted numerous change orders for more than $4 million. Some change orders were approved, while others were denied.

According to documents, the Board claims Sletten is attempting to extort the Board into paying unreasonable amounts with the threat of ceasing work on the terminal if the Board doesn’t give into its demands.

The Board claims Sletten breached its contract, breached the implied covenant of good faith and fair dealing, breached its fiduciary duty, broke its promissory estoppel, and the company was neglectful in its representation.

The Board is asking the court to rule in its favor and order Sletten to complete the project for the maximum price agreed to in the April 2021 GMP, that the Board is not responsible for any amount beyond the April 2021 GMP, and that Sletten is responsible to cover that amount and is not entitled to any GMP adjustments. They are also asking the court to prevent the company from stopping work on the project.

The Board also claims Sletten owes liquidated damages under the contract by not completing the project on time. The Board claims it is entitled to liquidated damages of $2,500 per day beyond the final completion date and any other relief the court deems appropriate.

Snow Removal Equipment Project

The second and most recent lawsuit for the SRE project has similar claims to the commercial terminal project.

According to the complaint, the project was estimated to cost around $3.9 million and is being paid through FAA and WYDOT funding. Sletten and the Board also entered into a CMRA agreement governed by a GMP for this project as well. At first, Sletten submitted an estimate of $4.6 million, but after looking for potential savings it submitted a GMP of around $3,870,545 in August of 2020.

The Board claims Sletten entered into the CMRA knowing that “if the GMP is exceeded, the CMRA shall be responsible for payment from its own resources with no contribution from the owner of the difference between the actual price and the GMP as adjusted by change orders if any.”

The SRE project was to be completed within five months, however, the board granted a request for additional time from October 29, 2021 to November 26, 2021. The board claims this contract also had a liquidated damages of $2,500 per day beyond the final completion date.

After Sletten was informed in March of 2022 that the Board would be pursuing the liquidated damages, Sletten informed the Board the revised GMP was now $4,751,021, which is nearly $1 million over budget.

The Board claims that Sletten then started submitting numerous change orders to the project that was already seven months past the completion deadline. The Board claims many of those chain orders were submitted untimely or after the work related to the change order already started, which is in violation of the contract.

While the Board approved some of the change orders, it denied others. The final completion date was March 15, 2023, a delay of 474 days beyond the contractual deadline and more than 140 days from the substantial completion date, which was October 24, 2022.

The Board also claims Sletten breached its contract, breached the implied covenant of good faith and fair dealing, breached its fiduciary duty, broke its promissory estoppel, and the company was neglectful in its representation.

The Board is asking the court to rule in its favor and find that it does not owe Sletten anything more than what the company quoted it in the August of 2020 GMP of $3,870,545, that Sletten is responsible for any costs exceeding that quote, and order the company to pay the liquidated damages of around $2 million, and any other relief the court deems appropriate.