An Exaggerated Public Works Claim Results in Total Forfeiture of Claim

The Colorado Court Appeals issued a decision that is the first of its kind in Colorado. In Ralph L. Wadsworth Constr. Co., LLC v. Reg’l Rail Partners, 2024 COA 78, a 3-judge panel of the Court interpreted the Colorado Public Works Act to require a complete forfeiture of a claim for payment if the claim is knowingly overstated. Trial court testimony led the appeals court to the conclusion that the Verified Statement of Claim amount ($12M) was artificially inflated and therefore required reversal of the $5M partial award to the claimant in the trial court. The claimant was not entitled to recoup anything. Acknowledging the severity of the result, the Court of Appeals stated that its ruling was required by the plain wording of the statute.