Volume: 19, Issue: 1 - 01/15/2021

 

The terms and conditions of any construction contract are comprised of clauses, frequently “standard” to the project owner, that are intended to apply to all projects the owner undertakes. The contract also includes special provisions and specifications unique to that particular project. The interplay among the components of the contract can raise some interesting questions. This was seen in a recent dispute arising out of a federal contract for a flood control project. In a recent ASBCA case, this caused an interesting case of compensable suspension days vs. anticipated weather days already allocated in the project's CPM schedule.

 

The second case this week involved a court's decision upheld the oral contract modifications that were supported through the owner's past course of conduct.  In this week's third case, a court weighed in on definitions in the bid solicitation that resulted in a low bid being rejected. Read more.


 

An “Adverse Weather” clause took a stipulated number of days each month off the schedule’s critical path. This determined excusable weather delay under the Default clause. It did not affect the Suspension of Work clause. The project owner improperly subtracted the stipulated adverse weather days from the number of days of compensable suspended work.


 

Because a public project owner was not prohibited from oral contract modification by charter or statute, a contractor was entitled to present evidence of a course of conduct and to argue that the owner had waived a contract requirement for advance written change orders.


 

A vague definition of “the Work” prevented a public project owner from enforcing a subcontracting limitation in a bid solicitation. The low bid was nonresponsive, however, due to the bidder’s failure to commit to subcontracting 10% of the contract value to certified disadvantaged business enterprises.


Volume: 18, Issue: 24 - 12/31/2020

 

When a subcontractor’s work is called into question, is the project owner entitled to pursue a direct action against the sub? Both cases in this issue relate to that question. A design subcontractor fared well. A construction subcontractor found itself vulnerable. Read more.

 

The staff of WPL Publishing Company wishes our readers a Safe, Happy and Healthy 2021.

 

A project owner could not sue an architect’s engineering consultant for alleged negligent performance of its subcontract with the architect. The project duties and responsibilities of the parties were defined in a vertical contracting arrangement. Tort suits among the parties would disrupt the contractual allocation of risk and therefore were not allowed.


 

A “waiver-of-rights” clause in a construction contract protected the project owner and prime contractor from claims for insured property losses. Incorporation of the clause into subcontracts shielded the owner and contractor from subcontractor claims. But incorporation did not protect a subcontractor against a subrogation action by the project owner’s property insurer.


Volume: 18, Issue: 23 - 12/16/2020

 

This week's newsletter provides three interesting cases.  The first involves a general contractor's successful attempt to force a late-performing foundation contractor to pay acceleration costs of follow-on subcontractors even though the costs exceeded the foundation subcontractor's liquidated damages exposure in addition to the standard subcontract form that disclaimed liability for such costs.  The second case involves documentation prerequisites for a differing site conditions claim and the last case involves pricing of a change on a design/build contract.  Read more.


 

A prime contractor disclaimed liability for acceleration costs in its subcontracts, yet the contractor could recover voluntary, extra-contractual acceleration fees paid to subcontractors. These were breach of contract damages for which the delaying lead subcontractor could be held liable.


 

A public works contract made itemization and documentation of costs a precondition to a valid claim for increased compensation. Where a contractor repeatedly failed to provide such information, the contractor was not entitled to a jury trial on its differing site conditions claim. A representation that costs would be proved through testimonial evidence should not have been enough to survive the project owner’s motion for summary judgment.


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