On April 6, 2026, the Colorado Supreme Court held in Ralph L. Wadsworth Construction Co., LLC v. Regional Rail Partners, 2026 CO 19, that subcontractors on public projects may seek recovery of disputed or unliquidated amounts—including delay and disruption damages—in verified statements of claim under the Public Works Act. The Court also clarified that the penalty for filing an excessive claim is forfeiture of statutory remedies only, leaving common law claims available.
The Colorado Public Works Act
Because government property cannot be subjected to mechanics’ liens (the security interest contractors typically use on private projects), Colorado enacted the Public Works Act to give contractors and subcontractors analogous protections on public projects. Under section 38-26-107(1), C.R.S. (2025), a party that has furnished labor, materials, or equipment for a public project may file a “verified statement of claim”—i.e., a statutory lien—against retained contract funds held by the public entity. The public entity must then withhold sufficient funds until the claim is resolved. As a safeguard against abuse, section 38-26-110(1) provides that a claimant who files an “excessive” claim—one for more than the amount due, with no reasonable possibility it was due, and with knowledge of that fact—forfeits certain rights and remedies.
A central question in Wadsworth was whether “disputed or unliquidated amounts”—sums whose value has not been finally determined or that are subject to genuine dispute—may be included in such a claim.
Background
In 2013, the Regional Transportation District (“RTD”) contracted with Regional Rail Partners to build the North Metro Rail Line, a $343-million public works project. Regional Rail Partners, in turn, subcontracted with Wadsworth for rail work. After the project experienced delays and disruptions, Wadsworth filed a verified statement of claim with RTD—the public contracting body required to receive such claims under the Act—for about $12.8 million it believed Regional Rail Partners owed it for labor, materials, and other project costs. Wadsworth then sued Regional Rail Partners and others; after a ten-day bench trial, the court found the claim was not excessive and awarded Wadsworth over $3.7 million, including delay and disruption damages, and over $1.9 million in unpaid construction funds.
A division of the Court of Appeals reversed, holding that that Wadsworth’s claim was excessive as a matter of law because it included disputed delay and disruption damages—amounts that, in the division’s view, a subcontractor may not include in a verified statement of claim because they had not yet been proven or agreed upon. As a consequence, the division concluded that Wadsworth had forfeited its entire claim—not just statutory remedies—including all legal avenues of recovery.
On appeal, the Colorado Supreme Court addressed two questions: (1) whether disputed or unliquidated amounts—including delay and disruption damages—may be included in a verified statement of claim, and (2) whether the penalty for filing an excessive claim forfeits all legal remedies or only statutory remedies under the Act.
The Colorado Supreme Court’s Holdings
The Court answered both questions in favor of the subcontractor.
First, the Court held that disputed and unliquidated amounts are permissible because the plain language of sections 38-26-107 and 38-26-110 does not prohibit claimants from including disputed or unliquidated amounts in a verified statement of claim. An amount may be disputed yet still have a “reasonable possibility” of being due, and reading the statute to bar all disputed amounts would undermine the Act’s protective purpose.
The Court further held that delay and disruption damages—the added costs for labor, materials, and equipment incurred because of project delays or lost productivity—are permissible so long as they fall within the statute’s categories. However, purely consequential damages, such as lost profits or idle equipment time, may not be included.
Second, the Court held that forfeiture is limited to statutory remedies only and does not extend to common law claims (e.g., breach of contract). Finding section 38-26-110’s forfeiture language ambiguous, the Court looked to the parallel provision in the Mechanics’ Lien Act, § 38-22-128, C.R.S. (2025), and its legislative history. Both confirmed that the legislature intended to limit forfeiture to statutory rights and remedies only—not all legal remedies.The Court reasoned that stripping contractors of all avenues of relief would deter claimants from exercising statutory remedies at all, contrary to the Act’s purpose.
The Court remanded the case to the Court of Appeals for further proceedings on issues raised in Wadsworth’s cross-appeal.
Key Takeaways
This decision provides important guidance for participants in Colorado public works projects. Contractors and subcontractors may include disputed and unliquidated amounts—including delay and disruption damages—in a verified statement of claim, provided the amounts represent costs for labor, materials, or other supplies used in performing the work. Purely consequential damages, such as lost profits, may not be included. And even if a claim is later found excessive, the claimant forfeits only its statutory remedies under the Act. Common law claims, such as breach of contract, remain available.
For questions about this legal alert, please contact a member of the Davis Graham Appellate Group.