"Defending the Stimulus Project": Application of the Spearin Doctrine to Stimulus Package Funded Construction Projects
On February 15, 2009, Congress approved the American Recovery and Reinvestment Act, commonly known as the “stimulus package.” Among other things, this package will infuse much needed funds into the construction industry. As a result, the number of government contracts with construction companies will vastly increase in a short amount of time. Therefore, contractors must be aware of the risks associated with government contracts and the means to protect themselves from the same.
In total, the stimulus package provides $134.8 billion for construction-related projects. The increase in construction projects expected to occur in the next couple of years as a result of this capital infusion will consequently lead to an increase in government contracts. As such, it is imperative to anticipate the legal consequences of these specific types of contracts. One legal issue that may arise from this increase involves the application of the Spearin doctrine to stimulus-related construction projects, and the application of the Government Contractor Defense. Whether or not the Spearin doctrine will be available to a private construction company contracting with the state or federal government afforded stimulus money is an important question that requires attention from the very beginning of a project.
The attached article examines the development of the Spearin doctrine and the Government Contractor Defense, and how the same may be applicable to the many construction projects supported by “stimulus package” funds.
To read the full article co-authored by Timothy Liam Epstein, please click here.