Question

a- • Must a contractor be delayed beyond the contractual project duration in order to successfully file a claim for 15 delay damages? • Explain your answer

b- • A contract contains the following clause: • “The owner specifically reserves the right to modify the progress schedule as required by the conditions of the work.” Can a contractor that has been delayed by the owner’s revisions to the order of the work in the schedule successfully file a claim for a time extension? • Explain your answer

c- • What is the role of “as-built” schedules in litigation involving delays?

d- • To minimize the chance of losses, suggest a methodology to follow when a delay, that has the potential 18 of resulting in litigation, occurs on a construction project.

e- • Explain two of the added costs that might be incurred by the contractor as a result of a change issued by the owner.

Answer 1

a) Most contracts state that a contractor is not responsible for delays from causes beyond the contractor’s control. In fact, some state contractor’s regulations require such an explicit “force majeure” clause in contracts. This type of force majeure clause entitles a contractor to a time extension only. The contractor is protected from liquidated damage or other claims for delays beyond the contractor’s control, but the contractor’s affirmative claim for compensation for the delay will be controlled by other contract provisions. Hence contractor must not be delayed beyond the contractual project duration in order to successfully file a claim for 15 delay damages.

b) Most construction contracts state that there will be no payment for changes in the work unless ordered in a signed writing. These clauses are generally enforceable and can obviously impact a contractor’s right or ability to collect for changes, delays and other claims. If the contract has a written change order clause, the contractor may not get paid unless there is a written change order. It does not matter how much work was done, how much it cost or who ordered the work. Written change order clauses are actually required by many state licensing statutes or regulations. If it is impossible to get a signed change order or work must begin immediately, the contractor has a “claim.” The claims provisions in the contract become important, particularly written notice requirements.

c) To identify the activities in which delay occurred, an “as built” schedule is prepared showing the durations of each of the activities as actually performed or “as built.” The as planned schedule must also be analyzed to correct any errors. An “as planned to as built” analysis will compare the as built schedule to the adjusted as planned schedule to identify activities that took longer than planned or how sequencing of activities changed. A “collapsed as built” analysis uses a reverse methodology that starts with an as built schedule and then deletes or removes delays. The as built schedule is then analyzed without each delay and concludes that the project could have been completed at an earlier date if the delays had not occurred.

d)

e) Following are the two added costs that might be incurred by the contractor as a result of a change issued by the owner:-

(1) Direct Cost - Direct costs are the easiest to identify and quantify because they’re tangible. They also often visibly impact project outcomes; therefore, they’re generally easier to justify in the event of changes or alterations. Typical direct costs include labor, materials, equipment, and expenses related to the change. However, there are additional direct labor, material, and equipment costs that are often overlooked and therefore impact profitability.

(2) Consequential Cost - The final piece in recovering your true costs is to understand and account for consequential costs. These are the costs incurred due to timing and scope changes, which may impact overall project costs or duration. It include Stacking of trades, Reassignment of manpower, Dilution of supervision, Site access interference, or Impact of seasonal and weather conditions.