Concerning clarification of the penalty for claiming an excessive amount in a public construction performance bond dispute.
Summary
SB 26-074 clarifies the penalty that applies when a contractor knowingly claims an excessive amount in a public construction payment dispute. Under current law, private construction contractors who knowingly overstate a mechanic’s lien forfeit the lien-related rights tied to that claim and may be liable for costs and attorney fees. This bill extends that same basic approach to public construction projects by specifying that a contractor who knowingly files an excessive verified statement of claim (VSOC) or asserts an excessive bond claim forfeits all rights created under the public construction bond and lien statutes to recover the amount claimed.
The measure is aimed at aligning the treatment of excessive claims in private and public construction settings. It does not create a new remedy so much as clarify that the penalty for an excessive public bond claim is the loss of statutory rights associated with that bond or lien claim, along with liability for reasonable costs and attorney fees incurred in responding to the claim. The bill takes effect after the standard post-session period unless referred to voters.
Impact
The bill amends Colorado Revised Statutes section 38-26-110, which governs excessive claims in public construction bond disputes. It clarifies that a person who knowingly files an excessive verified statement of claim or bond claim forfeits all rights under Article 26 to recover the claimed amount and remains liable for costs and attorney fees reasonably incurred in contesting the claim. In practical terms, the bill strengthens and clarifies the enforcement framework for public construction payment disputes and brings it into closer alignment with the existing penalty structure for private mechanic’s lien claims.
Sentiment
The available context suggests the bill was noncontroversial and technical in nature. It moved through the Judiciary committees in both chambers and was signed by the Governor, with no recorded votes or committee transcript indicating opposition. The overall sentiment appears supportive, likely because the bill is framed as a clarification rather than a substantive expansion of liability.
Contention
No specific points of contention are reflected in the provided legislative history. The main policy issue embedded in the bill is whether the penalty for an excessive public construction claim should mirror the private lien rule by stripping all statutory recovery rights tied to the claim. Any concern would likely come from contractors or industry stakeholders worried about harsh consequences for disputed claim amounts, while owners, sureties, and public entities would likely favor the added clarity and deterrence against inflated claims.