FEB. 6, 2012 – Attorney General Martha Coakley’s office has filed a lawsuit against XL Specialty and its agent Fasano & Acchione Associations for the company’s failure to compensate the Commonwealth for more than $3,000,000 dollars in the wake of a bridge collapse in Grafton. According to the complaint, through “recklessness and negligence”, “…Bridges allegedly caused the historic bridge to collapse by failing to ensure proper support of the bridge during a crucial step in its reconstruction.” If the lawsuit is successful and the defendants actions are deemed to have violated C. 93A sec. 2 and 4, the Commonwealth may also be able to recover treble damages.
MassDOT had a performance bond with XL Specialty
According to the Complaint filed in the Suffolk Superior Court, in 2005 MassDOT entered into a contract with Roads, Inc. and a performance bond with XL Specialty regarding the restoration of 100 year old stone arch bridge in Grafton, MA. The total cost of the bridge’s restoration was valued at approximately $1.7 million. Shortly after work began, Roads, Inc. abandoned the project and XL Specialty assumed control, employing Bridges, Inc. to complete the restoration. While attempting to complete the restoration project, however, Bridges, Inc. allegedly caused the historic bridge to collapse through a failure to ensure proper support of the bridge during a crucial step in its reconstruction. The AG’s office says under the terms of the contract XL Specialty was required to rebuild or replace the bridge.
The AG’s office explains that when the Commonwealth outsources a public works project, like the restoration of a historic bridge in Grafton, the contractor is required to obtain a performance bond that guarantees the entire project. This is a vital requirement of the public bid process, the AG’s office explains, as it protects the Commonwealth from reckless contractors. When a contractor fails to finish the project that results in major losses to the Commonwealth from the re-bidding of the project at a higher costs and the lost money already paid to the original contractor.
“When we spend taxpayer dollars on bridge repairs we fully expect the work to be done in a high quality, safe and efficient manner,” said Secretary of Transportation and CEO Richard A. Davey. “In this case, none of those standards were met. I appreciate the Attorney General’s office pursuing this important matter.”
The Attorney General’s office decides to take action
“When businesses defraud the Commonwealth they defraud taxpayers,” AG Coakley said. “Our office will work to hold accountable those who attempt to circumvent their legal obligations and recover any damages sustained by the Commonwealth as well as penalties for their unlawful conduct.”
Assistant Attorneys General Matthew T. Connolly and Jeffrey Walker of Attorney General Coakley’s Consumer Protection Division are handling this case and looking to recover the cost to construct the new bridge, penalties and investigation and litigation costs from both XL Specialty and its agent Fasano.
The ultimate replacement cost for the bridge totaled more than $3,000,000 above and beyond the amount already paid to the original contractor Roads, Inc. and XL Specialty. XL Specialty claimed non-payment of the sum because “the original designed provided was not “constructible” (sic) and that the Commonwealth was guilty of certain misrepresentations and concealment of information. The complaint alleges that XL Specialty’s statements are false and that were made with the sole purpose of avoiding its obligation to pay the Commonwealth. In addition, the complaint alleges that XL Specialty and its agent Fasano, an insurance consulting company, “…engaged in a cover-up designed to obscure the cause of the bridge failure and transfer blame to the Commonwealth.”