Chapter 17 - § 17.10 • ADMINISTRATIVE CLAIMS

• Jurisdiction: Colorado

§ 17.10 • ADMINISTRATIVE CLAIMS

The operation of administrative procedure clauses is demonstrated in City & County of Denver v. District Court.⁷⁰ The City and County of Denver (Denver) hired general contractor PCL, who in turn hired Corradini under a subcontract to do work at Denver International Airport. The contract between Denver and PCL required that "disputes regarding the contract shall be resolved by administrative hearing under procedures described in Revised Municipal Code Section 56-106." Disputes arose between Corradini and PCL, between PCL and Denver, and between Corradini and Denver. Both PCL and Corradini filed suit against Denver. At issue was whether the contract required Corradini to pursue its claim via administrative hearing or allowed it to maintain its claim in court.

Because Corradini was not a party to the contract between Denver and PCL, its claim existed independently and Corradini was not compelled to submit to an administrative hearing.⁷¹ The court stayed Corradini's claim until completion of Denver and PCL's administrative hearing, though, because the pursuit of the Corradini claim prior to conclusion of the hearing could result in inconsistent determinations.⁷²

The obvious lesson from this case is that Colorado courts are not at all reluctant to require parties to use contractually mandated administrative procedures set out in the contract. The clear implication is that the right of parties to contract encompasses the power to agree to a non-arbitration ADR method. Moreover, in order to bypass such a...