MIORELLI DOCTRINE’S SOVEREIGN IMMUNITY IN PUBLIC CONSTRUCTION CONTRACTS — NOT THE BE-ALL AND END-ALL

In the Florida commercial contract public arena, there is a sovereign immunity doctrine known as the Miorelli doctrine after 1997 Florida Supreme Court decision, County of Brevard v. Miorelli Eng’g, Inc., 703 So.2d 1049 (Fla. 1997).  This doctrine would apply to construction contracts between a contractor and a public body.

Through the years, the Miorelli doctrine stands for the proposition in commercial transactions with a Florida public body “that the doctrine of sovereign immunity precludes recovery of the cost of extra work where claims for that extra work are ‘totally outside’ the terms of the contract.”  Monroe County v. Ashbritt, Inc., 47 Fla.L.Weekly D594a (Fla. 3d DCA 2022).  See also Asbritt, n.2 quoting Posen Construction v. Lee County, 921 F.Supp.2d 1350, 1356 (M.D.Fla. 2013) (“A claim for damages predicated on work ‘totally outside the terms of the contract‘ is barred by the doctrine of sovereign immunity, whereas damages caused by extra work done at the state’s behest and in furtherance of the contractual covenants (express or implied) are potentially recoverable.”)

It is not uncommon for the public body to rely on sovereign immunity and the Miorelli doctrine when there is, in essence, a change order dispute on a public construction project, i.e., a claim for unpaid additional work.   This is to be expected and it will be asserted as an affirmative defense.

However, the Miorelli doctrine is NOT the be-all and end-all to a change order dispute such that a contractor’s change order dispute goes away.  Far from it because the issue should turn on whether the change order work is totally outside the terms of the contract.

The Third District in Ashbritt, Inc. dealt with a public body, Monroe County, relying on the Miorelli doctrine to argue it had sovereign immunity from the contractor’s extra work payment dispute.  In this case, the public body hired a contractor to handle certain post-hurricane disaster relief–remove and haul off debris.  The contractor submitted a claim for additional work arguing it was tasked to dispose of putrefied waste and haul debris to locations farther away than planned which caused it to incur additional costs.

The public body moved for summary judgment under Miorelli – that it had sovereign immunity from these additional costs.  The contractor, conversely, contended that such additional costs were not totally outside the contract.   The trial court held this issue was a question of fact and denied the public body’s sovereign immunity argument. The public body appealed.  The Third District, affirming the trial court, expounded:

[The contractor] alleges that the County… acknowledged and required the additional work. Here, [the contractor] submitted a proposed amendment to the contract to add a line item and price for removal of putrefied waste, pursuant to an express provision in the contract providing an amendment procedure. The County refused the amendment, asserting that contract included the disputed work. [The contractor] continued to work, under protest, and brought a claim for damages. Recognizing the disputed issue of fact regarding the scope of work, the trial court denied the County’s motion for summary judgment based on sovereign immunity….

Miorelli explains that “[b]inding the sovereign to the implied covenants of an express contract is quite different from requiring a sovereign to pay for work not contemplated by that contract.”  The parties dispute whether the work performed constituted work “totally outside the terms of the contract,” extra work done at the County’s behest in furtherance of express or implied contractual covenants, or work done as part of the express contract terms. [The contractor] presented evidence at summary judgment that the contract language included an amendment procedure, that the County required the additional work, that this additional work should have been added on as an amendment per industry custom, and that the failure to amend after requiring the additional work constituted a breach of the contract’s express and implied duties and covenants. The County argues that the work was included in the contract terms or constituted gratuitous work outside the scope of the contract. Accordingly, the trial court correctly identified issues of fact regarding the application of summary judgment based on a claim of sovereign immunity and denied the County’s motion.

Ashbritt, Inc., supra (internal citations omitted) (relying on and quoting W&J Constr. Corp. v. Fanning/Howey Assocs., 741 So.2d 582, 584 (Fla. 5thDCA 1989) explaining “In this case, the essence of this dispute is whether the original contract specifications and engineering requirements encompassed the work [the contractor] claims was above and beyond that originally required by the contract.  If it did, then [the contractor] is entitled to no additional compensation.  If it did not, because the appellees required [the contractor] to do the work yet failed to issue a change order as it should have done pursuant to the contract, [the contractor] may be entitled to compensation.”).

As seen, just because a public body argues under Miorelli does not in of itself mean that it will have sovereign immunity from the change order / additional work dispute.  This is because there should be arguments that the change order / additional work is not totally outside of the contract to warrant the application of sovereign immunity.

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

 

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