Contractor sues Illinois Tollway, alleging breach of $323 million contract

A contractor that says its $323 million contract for work on the massive Interstate 294 reconstruction project was improperly terminated has sued the Illinois Tollway.

Judlau Contracting, a New York-based company, says in its lawsuit that it had started work on the interchange of Interstate 290 and Interstate 88 when its contract was terminated by the Illinois Tollway on May 16. The lawsuit, filed in DuPage County Circuit Court, says the action was without proper legal basis and harmed the company’s reputation and overall business.

The company also says the sudden halt in the project could cost taxpayers millions of dollars extra and create safety risks for drivers on the interchange.

The reconstruction and reconfiguration of the I-290/I-88 interchange near the west suburbs of Elmhurst and Berkeley is expected to “reduce congestion, improve safety and address operational issues as well as infrastructure conditions” and is part of the Illinois Tollway’s $4 billion Central Tri-State Project,” according to the Tollway website.

Judlau said it began construction work on the project April 1 and was terminated six weeks later “notwithstanding Judlau’s good faith, professionalism and unblemished performance to date under the contract.”

The lawsuit says that the sudden halt of the project “at a critical juncture” also poses safety risks that include a stage bridge demolition site at the bypass of I-290 over Electric Avenue in Berkeley that has been left uncompleted. If the termination stands, the project could be delayed for months if the Tollway goes through another bidding process to hire a new company to complete it, according to the lawsuit. Judlau is asking the court to prohibit the Tollway from giving the work to another company without going through a reprocurement process.

“After repeated efforts to engage the Tollway on their abrupt decision were rebuffed, regrettably, we were forced to take this action to protect ourselves, our subcontractors, Illinois taxpayers and motorists,” Arnav Amin, executive vice president of Judlau Contracting, said in a statement.

Judlau said the state agency cited two specific provisions for ending the contract. One specifies that termination can only occur if “there are changed circumstances, the effects of which were not known to the Tollway at the time of execution of the contract, and, for these reasons, the Tollway determines that termination is in its best interest,” according to the complaint. The other provision allows the Tollway to “cancel or alter any or all portions of the work” due to “circumstances either unknown at the time of bidding or arising after the contract was entered into.”

Judlau said it knows of no factors that satisfy those provisions, and that the Tollway did not provide further explanation, responding only several days later by saying “at this time, we do not have any additional information to convey regarding the termination.”

The Tollway said in an email to the Tribune that it has no comment on the lawsuit at this time.

ostevens@chicagotribune.com