Electrical Contractors, Inc. v. Ins. Co. of the State of Pennsylvania, 314 Conn. 749

Morganti Group, Inc. was the general contractor on a Newtown High School project; Electrical Contractors, Inc. (ECI) was the electrical subcontractor seeking payment.
Defendant Insurance Company of the State of Pennsylvania (surety) provided a $33.7 million labor and materials payment bond for the project.
ECI claimed $746,300.25 (originally $751,190.63) for added costs and submitted a notice of claim in June 2011.
Surety acknowledged receipt, requested further information, and the parties engaged in limited responses before litigation.
ECI filed suit in federal court on September 16, 2011 asserting payment on the bond and bad-faith denial by the surety.
District Court certified two questions about whether failure to pay/deny within 90 days is a waiver and whether a later information request constitutes denial or good-faith dispute; court's ruling addressed the waiver issue and, to extent relevant, denial as exhaustion for suit.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the 90-day deadline is mandatory or directory.	ECI contends the deadline is mandatory, creating a waiver of defenses if missed.	Surety argues the deadline is directory and noncompliance does not waive defenses.	Directory; does not waive defenses.
If the 90-day failure constitutes denial or waiver under exhaustion rules.	ECI argues failure to respond within 90 days waives defenses and allows full payment.	Surety argues failure to respond is not automatic waiver and does not compel full payment.	Failure to pay or deny within 90 days is treated as a denial for exhaustion purposes; not a waiver of defenses.

Weems v. Citigroup, Inc., 289 Conn. 769 (2008) (directory nature of some statutory duties; not automatically mandatory)
Katz v. Commissioner of Revenue Services, 234 Conn. 614 (1995) (mandatory language not always implies compulsory action; factors used to interpret statute)
United Illuminating Co. v. New Haven, 240 Conn. 422 (1997) (notice within time may be directory; not jurisdictional in all contexts)
Broadriver, Inc. v. Stamford, 158 Conn. 522 (1969) (directory vs mandatory; public taking deadlines treated as directory in certain contexts)
Angelsea Productions, Inc. v. Commission on Human Rights & Opportunities, 236 Conn. 681 (1996) (context of agency deadlines and remedial statutes; not always mandatory)
Ghent v. Planning Commission, 219 Conn. 511 (1991) (court may not read into legislation provisions not expressed; mandatory vs directory analysis)