Contractor’s Burden When It Comes to Delay
October 26, 2020 —
David Adelstein - Florida Construction Legal UpdatesWhen a contractor is challenging the assessment of liquidated damages, or arguing that it is entitled to extended general conditions, the contractor bears a burden of proof to establish there were excusable delays that impacted the critical path and, in certain scenarios, the delays were not concurrent with contractor-caused delay:
When delays are excusable, a contractor is entitled to a time extension, such that the government may not assess liquidated damages for those delays. The government bears the initial burden of proving that the contractor failed to meet the contract completion date, and that the period of time for which the government assessed liquidated damages was correct. If the government makes such a showing, the burden shifts to the contractor to show that its failure to timely complete the work was excusable. To show an excusable delay, a contractor must show that the delay resulted from “unforeseeable causes beyond the control and without the fault or negligence of the Contractor.” “In addition, the unforeseeable cause must delay the overall contract completion; i.e., it must affect the critical path of performance.” Further, the contractor must show that there was no concurrent delay.
Ken Laster Co., ASBCA No. 61292, 2020 WL 5270322 (ASBCA 2020) (internal citations omitted).
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
CAPSA Changes Now in Effect
November 14, 2018 —
Wally Zimolong - Supplemental ConditionsBack in June, I posted about changes coming to the Pennsylvania Contractor and Subcontractor Payment Act (CAPSA), 73 P.S. Section 501, et. seq. The Act applies to virtually all private construction projects in Pennsylvania. As of last week (Oct. 10), those changes are effective. While there is some argument to the contrary, these changes are NOT retroactive and apply to all projects going forward from that date. To recap, here are some of the important changes you need to be aware of:
- Contractual waivers. Parties cannot waive the applicability of the act through contract. Therefore, any clause in a contract purporting to waive the Payment Act’s applicability is void.
- Suspension of work. Unpaid contractors and subcontractors have always enjoyed a common law right to suspend performance until payment was made. Now, they also have a statutory right to do so. Section 5 of the Payment Act ads a subpart (e) which states that an unpaid contractor or subcontractor can suspend performance without penalty if it is not paid.
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Wally Zimolong, Zimolong LLCMr. Zimolong may be contacted at
wally@zimolonglaw.com
Construction Defects Up Price and Raise Conflict over Water Treatment Expansion
August 27, 2013 —
CDJ STAFFThe owner of a regional water treatment plant in California has filed a lawsuit against the where they operate. Construction defects lead to cost overruns at the Modesto Irrigation District’s water treatment plant. Now the question is whether MID or Modesto will be paying for the expenses. Both parties sued Black & Veatch and others, receiving $14.9 million.
But the problems have lead to the cost of the water treatment plant expansion ballooning to $107.5 million, a big jump over the planned $62.9 million. Also, instead of being completed in 2009, the completion date has been pushed to 2015.
Modesto originally agreed to pay for the expansion, which will increase plant’s ability to provide drinking water to 66 million gallons per day with the agreement that MID would provide the water at the cost of producing it. But now the cost to Modesto of those additional 36 million gallons a day is an additional $44.6 million.
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Does a No-Damage-for-Delay Clause Also Preclude Acceleration Damages?
January 27, 2020 —
Ted R. Gropman & Christine Z. Fan - ConsensusDocsConstruction contracts often include a “no damage for delay” clause that denies a contractor the right to recover delay-related costs and limits the contractor’s remedy to an extension of time for noncontractor-caused delays to a project’s completion date. Depending on the nature of the delay and the jurisdiction where the project is located, the contractual prohibition against delay damages may well be enforceable. This article will explore whether an enforceable no-damage-for-delay clause is also a bar to recovery of “acceleration” damages, i.e., the costs incurred by the contractor in its attempt to overcome delays to the project’s completion date.
Courts are split as to whether damages for a contractor’s “acceleration” efforts are distinguishable from “delay” damages such that they may be recovered under an enforceable no-damage-for-delay clause. See, e.g., Siefford v. Hous. Auth. of Humboldt, 223 N.W.2d 816 (Neb. 1974) (disallowing the recovery of acceleration damages under a no-damage-for-delay clause); but see Watson Elec. Constr. Co. v. Winston-Salem, 109 N.C. App. 194 (1993) (allowing the recovery of acceleration damages despite a no-damage-for-delay clause). The scope and effect of a no-damage-for-delay clause depend on the specific laws of the jurisdiction and the factual circumstances involved.
There are a few ways for a contractor to circumvent an enforceable no-damage-for-delay clause to recover acceleration damages. First, the contractor may invoke one of the state’s enumerated exceptions to the enforceability of the clause. It is helpful to keep in mind that most jurisdictions strictly construe a no-damage-for-delay clause to limit its application. This means that, regardless of delay or acceleration, courts will nonetheless permit the contractor to recover damages if the delay is, for example, of a kind not contemplated by the parties, due to an unreasonable delay, or a result of the owner’s fraud, bad faith, gross negligence, active interference or abandonment of the contract. See Tricon Kent Co. v. Lafarge N. Am., Inc., 186 P.3d 155, 160 (Colo. App. 2008); United States Steel Corp. v. Mo. P. R. Co., 668 F.2d 435, 438 (8th Cir. 1982); Peter Kiewit Sons’ Co. v. Iowa S. Utils. Co., 355 F. Supp. 376, 396 (S.D. Iowa 1973).
Reprinted courtesy of
Ted R. Gropman, Pepper Hamilton LLP and Christine Z. Fan, Pepper Hamilton LLP
Mr. Gropman may be contacted at gropmant@pepperlaw.com
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New York Appellate Court Affirms 1966 Insurance Policy Continues to Cover WTC Asbestos Claims
January 02, 2019 —
Michael S. Levine & Joshua S. Paster - Hunton Andrews KurthIn a prior post, we discussed a New York trial-court decision that found an insurance policy issued in 1966, to insure the construction of the World Trade Center, continues to cover modern-day asbestos claims, with each claim constituting an individual occurrence. Last week, in American Home Assurance Co. v. The Port Authority of N.Y. and N.J., 7628-7628A (1st Dep’t Nov. 15, 2018), an intermediate appellate court affirmed that decision, agreeing that coverage is triggered for claims tied to alleged asbestos exposure at the WTC site in the 1960s and ’70s.
Reprinted courtesy of
Michael S. Levine, Hunton Andrews Kurth and
Joshua S. Paster, Hunton Andrews Kurth
Mr. Levine may be contacted at mlevine@HuntonAK.com
Mr. Paster may be contacted at jpaster@HuntonAK.com
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#1 CDJ Topic: McMillin Albany LLC v Superior Court of California
December 30, 2015 —
Beverley BevenFlorez-CDJ STAFFStephen A. Sunseria of
Gatzke Dillon & Balance LLP discussed how the Fifth Appellate District court “issued a blistering criticism of the Fourth Appellate District’s prior opinion in Liberty Mutual Ins. Co. v. Brookfield Crystal Cove LLC (2013) 219 Ca.App.4th 98, which severely limited the reach of the Act to actions not involving property damage and allowing property damage claims to proceed freely under common law without any constraints posed by the Act.” Sunseri stated that “McMillin is a great victory for homebuilders, but battle lines are now clearly drawn between the two appellate districts.”
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In another article regarding the McMillin Albany LLC case,
Garret Murai of
Wendel Rosen Black & Dean LLP posted an article on his California Construction Law Blog that went over the legal debate of California’s Right to Repair Act including Liberty Mutual, Burch v. Superior Court, and KB Home Greater Los Angeles, Inc. v. Superior Court and concluded with a discussion of the McMillin Albany case. Murai predicted, rightly it turned out, that the case would see a “final round before the California Supreme Court.”
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In their December 2, 2015 article, authors
Richard H. Glucksman,
Glenn T. Barger,
Jon A. Turigliatto, and
David A. Napper of
Chapman Glucksman Dean Roeb & Barger reported that the California Supreme Court granted the petition for review of the McMillin Albany decision: “The holdings in Liberty Mutual and McMillin Albany present a conflict of authority that the California Supreme Court has appropriately deemed worthy of review. The parties will now be permitted to file briefs on the merits and amicus briefs will certainly be submitted by the defense and plaintiff bars.”
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Engineer at Flint Negligence Trial Details Government Water Errors
April 04, 2022 —
Richard Korman & Jeff Yoders - Engineering News-RecordWarren Green, vice president and chief engineer of Lockwood, Andrews & Newnam, an engineering consultant to Flint, Mich. during its disastrous water crisis of 2014 and 2015, testified in federal court last week that city officials forged ahead to switch its source of drinking water without adequate water softening or testing after one municipal manager assured him that the more extensive testing would be done.
Reprinted courtesy of
Richard Korman, Engineering News-Record and
Jeff Yoders, Engineering News-Record
Mr. Korman may be contacted at kormanr@enr.com
Mr. Yoders may be contacted at yodersj@enr.com
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GIS and BIM Integration Will Transform Infrastructure Design and Construction
October 09, 2018 —
Nicolas Mangon - Engineering News-RecordAn unfortunate fact of the architecture and engineering professions and the construction industry is that, between every stage of the process—from planning and design to construction and operations—critical data is lost.
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Nicolas Mangon, ENRENR may be contacted at
ENR.com@bnpmedia.com