Analyzing The Liability Of Government Entity For Contractual Breach And Breach Of Fiduciary Duty In An Essay.

Overview of County of Galveston v. Triple B Services, LLP, (2016)

  County of Galveston v. Triple B Services, LLP, (2016)

In this case a contractor’s claim in relation to damages for a road expansion project was analyzed by the Court of Appeals of Texas.  A contract for the extension of a road stretch of three mines was entered by the county with thee contractor. According to the contract the responsibility of moving fiber-optic utilities water and gas was on the county. According to the expert of the contractor a baseline schedule was established by the contract which had been created by the County’s Engineer. It indicated a date of start and unobstructed access to the area of road where the utilities were situated. The contract also had the provisions related to delay damages and in case the damages were requested by the Contractor, the damages were compensable.

The plans made by the constructors in relation to the construction project had anticipated that the utilities would be moved by the county within a particular date, the utilities took almost a year to be moved. However, the work had been completed by the contractor within the stipulated time. As per the report of the contractor additional cost had been incurred by him with respect to resetting and setting the barricades, hand forming manholes, additional labor, street cleaning, traffic control, flagging  and equipment.

It had been argued by the county that through Section 262.007 of the Local Government Code the county’s sovereign is waived in relation to construction contracts which includes claims for damages as the county was not able to move the utilities timely.

The issue in this case is to analyze whether the Country is liable to pay the contractor compensation in relation to the construction contract.

 In relation to the doctrine governmental immunity or sovereign it has been provided that in order to sue a government its consent is required. In the case of Tooke v. City of Mexia, 197 S.W.3d 325, 331 (Tex. 2006) it had been provided that two components of sovereign is recognized by Texas law which are exemption from liability as a judgment is barred from being imposed on a government entity and protection against suits according to which a government entity cannot be sued. In order to recover any compensation from the government entity both the above discussed forms of immunities have to be given up (Smith, 2017).  

By entering into a contract and binding itself voluntarily the government entities waive its rights against the liabilities arising from contractual breaches. However the immunity from being sued is not thereby waived. However the immunity to be sued can be waived by a legislature by the use of “clear and unambiguous” statutory language. The legislature only waives the right of government entity from being sued when the waiver is effected by unambiguous and clear language. This provides the opportunity to react to conditional changes and revising agreements for public benefit (Klass, 2017). 

Sovereign Immunity and Waiver of Rights for Contractual Breaches

The compensation which can be provided to the aggrieved part for the breach of contract by a government entity are limited to the balance owed and due on the part of the government entity with respect to the contract as it may have been altered, which also includes any amount in form of compensation in relation to increased cost for the performance of work obstructed due to the fault of the entity. Any amount which may be a result of any additional work imposed by the entity or any change orders in relation to the contract. Any attorney fees which may arise out of the dispute and are just and equitable. The government entity is also liable to pay any interest which may be allowed by law. However consequential damages and any other damages are prohibited through the status. The trials court subject matter jurisdiction over a case is challenged by a plea to the jurisdiction according to the case of Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547.

As per the literal meaning of the rule provided in section 262.007 it had been concluded by the court that a claim for damages against the county are eligible in case the damages are a result of faults on the part of the county. The differences between delay damages and disruption damages have also not been provided expressly in the statue (Post, 2017).

On appeal it had been agreed by the contractor that definition of disruption damages is not same as that of delay damage as it had been understood traditionally in the construction law field. The immunity which can be waived statutorily comprises if damages which can be in excess of delay damages.  Lost productivity cost and disruption can be claimed in form of damages from a government entity. There is a clear difference between delay damages and disruption damages. 

Tesla v Anderson (2017)

The issue in this case initiated out of the actions of sterling Anderson who was a non-technical program manager in Tesla Autopilot team. The person allegedly violated the contract he had with his employers by trying to recruit a few tesla engineers, through the use of proprietary and confidential information and altering evidence to hide his actions. This was done in order to benefit a venture which had been launched by him in completion with Tesla while he was still employed as an employee.

The feature of autopilot which had been built in all tesla vehicles and updated continually through over the air updates free of cost is regarded as the safest and one of the most reliable technology in the automobile industry. It order to play catch up with the company and get rich quick environment had been created by traditional automakers. A very small team of programs had been purchased for more than billion dollars. A fun comprised of 40 person known as cruise automation was bought by general motors for around one billion in July 2016.

Compensation for Contractual Breaches by Government Entities

In this case the plaintiff was Tesla Motors Inc which was a public Delaware corporation which had been incorporated in Palo Alto, California. The defendant was sterling Anderson who was an individual residing in Sunnyvale, California. Another defendant was Aurora Innovation, LLC which is a Delaware limited liability company in Mountain View, California.

The defendant was provided authority by the plaintiff to look after the team responsible for developing the software.  The defendant got familiar with the skillsets, performance and experience in relation to the employees working for the Autopilot program. The defendant had an agreement with the plaintiff before being appointed as a manager through which he was required to put all his professional time in the development of the plaintiff and not to disclose any information gained by him through the plaintiff to any other person instead of for the purpose of his work. It had been further agreed by the defendant that he would not be inducing any existing employee of the plaintiff to terminate his employment with the company over a period of one year. The above discussed information had been documented in an offer letter which was provided to the defendant. The defendant also owed a fiduciary duty to the plaintiff as per the law of bedrock California according to which he was prohibited from transferring his loyalty to any would be or existing competitor during the course of his employment. The claim was made by the plaintiff for the breach its contractual terms with the defendant and also his company which was a third party beneficiary discussed in this case as the second defendant. The company had made total six claims of relief against the defendants.

The issue in this case is to determine whether there has been a breach of contractual duties on the part of the defendant or not.

The law related to contracts in the United States is regulated by the United States Contract Law. The law is different in every state and a standard federal law for agreements is not present. However through the establishment of the uniform commercial code transactions in relation to the sale of gods have been standardized (Smits, 2017).

 There is significant diversity with respect to the interpretation of other kinds of contract. In common law if a contractual rights of a person has been broken he is entitled to the remedy which has been pre mentioned in the contact or any remedy which the court may decide upon analyzing the facts of the case. The principle intention of the courts in relation to legal agreements is that the no party is able to take advantage of another and no loss is caused to any party to the contract according to the contractual terms (Seitz & Watzinger, 2017).

  A breach of contract is a civil wrong and a legal cause of action when one party intentionally or unintentionally breaches the rights of the other party. When the breach is in relation to a minor term of the agreement the party who has suffered can claim compensation. However if the alleged breach is in relation to a major condition of the agreement the party can not only claim damages for the loss suffered by it but is also eligible for abolishing its duties under the contract (Smith, 2017).

The defendant owed a fiduciary duty to the plaintiff according to which he had to be loyal to the plaintiff during the course of employment. if the course of action taken by him was not loyal is has deemed to breach the fiduciary duty. The legal agreement also bounds the powers of the defendant and he can be punished if breached.

References 

Klass, G. (2017). Interpretation and Construction in Contract Law.

Post, R. (2017). Data Privacy and Dignitary Privacy: Google Spain, the Right to Be Forgotten, and the Construction of the Public Sphere.

Seitz, M. & Watzinger, M., (2017). Contract enforcement and R&D investment. Research Policy, 46(1), pp.182-195.

Smith, K. W. (2017). KWSnet Construction/Building Index.

Smith, K. W. (2017). KWSnet United States Federal Law Index.

Smits, J. M. (Ed.). (2017). Contract law: a comparative introduction. Edward Elgar Publishing.