The Alaska Supreme Court affirmed a superior court decision in favor of a construction contractor in a contract dispute with First Evangelical Covenant Church of Anchorage Alaska, according to a memorandum opinion issued January 14, 2026. The high court required only a relatively small reduction to the damages award originally granted to Michael L. Foster & Associates, Inc.

The case, *First Evangelical Covenant Church of Anchorage Alaska v. Michael L. Foster & Associates, Inc.*, stemmed from repairs needed after the church sustained fire damage. The church's leadership began negotiations with Foster & Associates, a general contracting firm, to handle the restoration work.

After the parties executed a contract for the repair work, complications arose during the project's progression. According to the court documents, the church's insurance company raised objections to invoices submitted by the contracting firm. The insurer eventually ceased making payments to Foster & Associates, creating a financial dispute between all parties involved.

Despite the payment issues, Foster & Associates completed nearly all of the required repair work on the fire-damaged church. However, with unpaid invoices mounting, the contracting firm filed suit against the church, alleging breach of contract for the outstanding payments.

First Evangelical Covenant Church responded by filing multiple counterclaims against Foster & Associates, including its own breach of contract allegations. The dispute proceeded to a bench trial in the Superior Court of the State of Alaska, Third Judicial District in Anchorage, with Judge William F. Morse presiding.

Following the trial, the superior court ruled in favor of the contracting firm on the central issues. The trial court determined that Foster & Associates had successfully met its burden of proof to demonstrate that most of its rates charged for the repair work were reasonable. The court dismissed the church's counterclaims and awarded damages to the contractor.

Unsatisfied with the trial court's decision, First Evangelical Covenant Church appealed to the Alaska Supreme Court. The church was represented by attorney Kevin T. Fitzgerald of Ingaldson Fitzgerald, P.C. in Anchorage, while Foster & Associates was represented by Charles Cacciola of Munson, Cacciola & Severin, LLP, also based in Anchorage.

The Alaska Supreme Court panel consisted of Chief Justice Carney and Justices Borghesan, Henderson, Pate, and Oravec. After reviewing the case, the high court largely upheld the superior court's findings and judgment.

In its memorandum opinion, the Alaska Supreme Court affirmed the trial court's ruling with only minor modifications. The court required a relatively small reduction to the damages award but otherwise left the superior court's decision intact. This means Foster & Associates will receive compensation for its work on the church repairs, though slightly less than the original award amount.

The decision was issued as a memorandum opinion under Alaska Appellate Rule 214. As noted in the court's standard notice, memorandum decisions do not create legal precedent in Alaska. Parties wishing to cite such decisions in briefs or oral arguments must review Alaska Appellate Rule 214(d) for specific requirements and limitations.

The case highlights common challenges that can arise in construction contracts, particularly when insurance coverage becomes a complicating factor. Property owners and contractors often face disputes when insurers object to billing practices or refuse to honor payments, leaving contractors seeking compensation directly from property owners.

For religious institutions like First Evangelical Covenant Church, such disputes can be particularly challenging as they typically operate on limited budgets and rely heavily on insurance coverage for major repairs following disasters like fires. The case demonstrates the importance of clear contract terms and communication between all parties, including insurers, when undertaking significant repair projects.

The construction industry frequently sees similar disputes when projects involve insurance claims, especially for fire damage or other covered perils. Contractors must often navigate complex relationships between property owners and insurance companies while ensuring they receive fair compensation for their work.

This case, designated as Supreme Court No. S-18748 and originally filed as Superior Court No. 3AN-17-05613 CI, represents the conclusion of a multi-year legal process that began with the initial contract negotiations following the church's fire damage.

While the memorandum opinion does not establish binding precedent, it provides insight into how Alaska courts approach construction contract disputes involving insurance complications and the standards for proving reasonable rates in contractor billing disputes.