Wewahitchka firehouse bonding company sues former contractor in federal court

The bonding company acting as the surety for the Wewahitchka Fire Station project has filed a federal lawsuit against the former contractor for the project, Winterfell Construction, Inc., and the company’s owners, Bay County Commissioner Tommy Hamm and his wife Jamie Hamm.

The lawsuit, which was filed with the United States District Court for the Northern District of Florida on October 10, seeks the repayment of losses, damages, costs and attorneys’ fees from Winterfell. It alleges Winterfell has failed to uphold their obligations under the General Agreement of Indemnity they signed with the surety.

“This action arises out of the Indemnitors’ failures and refusals to indemnify and hold harmless Surety against all losses, expenses, costs, and other damages, including attorneys’ fees, incurred by Surety as a result of having issued performance and payment bonds naming Winterfell as Principal,” read the bonding company’s complaint.

The bonding company, New York based Fair American Insurance and Reinsurance Company, filed their suit in federal court due to the plaintiff and defendant being located in different states.

According to an affidavit of service filed with the U.S. District Court for the Northern District of Florida,  Winterfell and its owners were served on October 31. 

They will have until November 21 to file a response.

FAIRCO’s legal action comes ten months after the contract for the fire station between Wewahitchka and Winterfell was terminated.

The bonding company and Winterfell were first put on notice by the city that the contractor was in breach of its contract with the city on January 13, 2022, after months of tensions between the two parties.

Two weeks later, the city terminated its contract with Winterfell, claiming concerns over the quality of the fire station’s construction, among other things.

In April, Winterfell filed a lawsuit against the city in Bay County Court claiming the city was in breach of the contract between the two parties. 

“The city and its representatives continually interrupted the subject project by instructing Winterfell to perform outside of the terms and conditions in the contract,” read Winterfell’s complaint in the case.

The construction company went on to allege that the city failed to sign necessary change orders in a timely manner, if at all, and that the city’s concerns over defective workmanship “would not prohibit the completion of the project.”

The case between Winterfell and the city is still pending. But movement has stalled considerably in recent months, causing the city to seek alternative methods for completing the firehouse project.

Earlier this month, the city sent a letter to FAIRCO demanding that the company uphold its obligations to the city under the bond in an attempt to recuperate some of the expenses for continuing with the fire station’s construction.

“This process has been ongoing for nine months,” Wewahitchka’s letter read. “FAIRCO is past due in meeting its obligations. We have attempted to address these matters with FAIRCO multiple times, including our letter dated July 14, 2022, and in subsequent conference calls. We now urge FAIRCO to initiate appropriate procedures to pay out on its bond obligations.”

In its lawsuit against Winterfell, FAIRCO alleges it has not been able to “fully collateralized by the Indemnitors before making any payments in discharge of any alleged Bond obligations.”

FAIRCO is suing Winterfell and Hamm on five counts: breach of contract, specific performance, exoneration, quia timet and common law.

Winterfell Construction, Inc. could not be reached  for comment in time for publication of this article.

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