2013 Maryland Code
STATE FINANCE AND PROCUREMENT
§ 15-219 - Procedure by unit -- Contract claims for construction contracts

§15-219.

(a) Except to the extent a shorter period is prescribed by regulation governing differing site conditions, a contractor shall file a written notice of a claim relating to a procurement contract for construction within 30 days after the basis for the claim is known or should have been known.

(b) Unless extended by the unit, within 90 days after submitting a notice of a contract claim under a procurement contract for construction, a contractor shall submit to the unit a written explanation that states:

(1) the amount of the contract claim;

(2) the facts on which the contract claim is based; and

(3) all relevant data and correspondence that may substantiate the contract claim.

(c) (1) Subject to paragraph (2) of this subsection, the head of the unit engaged in procurement of the construction shall review the contract claim.

(2) If the unit is part of a principal department or other equivalent unit, the Secretary of the principal department or the equivalent official shall review the contract claim, unless review has been delegated by regulation to the head of the unit.

(d) The person who reviews a contract claim under subsection (c) of this section shall:

(1) investigate the contract claim; and

(2) give the contractor written notice of a resolution of the contract claim:

(i) within 90 days after receiving the contract claim or a longer period to which the parties agree, if the amount of the contract claim is not more than the amount under which the accelerated procedure may be selected before the Appeals Board; or

(ii) for any other contract claim, within 180 days after receiving the contract claim or a longer period to which the parties agree.

(e) Recovery under a contract claim is not allowed for any expense incurred:

(1) more than 30 days before the required submission of a notice of a claim under subsection (a) of this section; or

(2) unless the time for submission of a claim is extended under subsection (b) of this section, more than 120 days before the required submission of the claim.

(f) (1) If the unit determines that it is responsible for a portion but not all of the amount claimed by the contractor, subject to the terms of the contract, the unit shall pay the undisputed amount.

(2) Payment of the undisputed amount:

(i) is not an admission of the liability of the unit on the claims; and

(ii) does not preclude recovery of the amount paid if it subsequently is determined that the determination of the unit was not correct.

(g) (1) A decision not to pay a contract claim is a final action for the purpose of appeal to the Appeals Board.

(2) The failure to reach a decision within the time required under subsection (c) of this section may be deemed, at the option of the contractor, to be a decision not to pay the contract claim.

(h) At the time of final payment, the unit shall:

(1) release the retainage due to the contractor; and

(2) pay any interest that:

(i) has accrued on the retainage from the time of payment of the semifinal estimate; and

(ii) is due and payable to the contractor.

§ 15-219 - 1. Contract claim against a contractor

(a) Written notice; contents; procedure upon receipt of claims. --

(1) A unit may assert a contract claim against a contractor by sending written notice to the contractor and the procurement officer that states:

(i) the basis for the contract claim;

(ii) to the extent known, the amount, or the performance or other action, requested by the unit in the contract claim; and

(iii) the date by which the contractor is required to provide a written response to the contract claim.

(2) On receipt of a contract claim from a unit, a procurement officer:

(i) shall review the substance of the contract claim;

(ii) may request additional information or substantiation through an appropriate procedure; and

(iii) may discuss or, if appropriate, negotiate the contract claim with the unit or contractor.

(3) The procurement officer shall proceed under subsection (b) of this section if the contractor fails to respond, provides an inadequate response, or denies the contract claim or the relief sought by the unit in whole or in part.

(b) Proposed decision upon claim when no resolution is reached. --

(1) If the contractor and the unit do not resolve the contract claim, the procurement officer shall prepare a proposed decision on the contract claim, including:

(i) a description of the contract claim;

(ii) references to pertinent contract provisions;

(iii) a statement of factual areas of agreement or disagreement; and

(iv) a statement in the proposed decision wholly or partly granting or denying the relief sought, with supporting rationale.

(2) Unless otherwise provided by regulation, the procurement officer shall submit the contract claim and proposed decision to:

(i) the head of the unit; and

(ii) the head of the principal department or other equivalent unit of which the unit is a part.

(3) (i) The reviewing authority shall approve, modify, or disapprove the proposed decision.

(ii) In disapproving a proposed decision, the reviewing authority may remand the contract claim with instructions to the procurement officer.

(iii) On remand, the procurement officer shall proceed as required under this subsection and in accordance with the instructions of the reviewing authority.

(4) The decision of the reviewing authority is the final action of the unit.