The impacts of COVID-19 on construction projects have been covered broadly on social media, industry publications, webinars and attorney websites. The various forms of lost productivity have been identified, with the challenges now to measure and price out the costs. In our COVID-19 coverage this week, John McConville of Compass International has provided some estimates on a few of these costs as well as made some calls on the economic impact to the industry over the next 3-12 months.
This Week's Cases
When pricing construction work, a necessary preliminary step is to determine which contract documents are needed and then evaluate their meaning. This sounds fundamental and self-evident. Yet contractors frequently fail to make this assessment and end up arguing reliance on provisions that will not support their position.
A Michigan highway contract specified the application of different classifications of unit-priced concrete pavement under different circumstances. The contract also included drawings that could be used for quantity take-offs. The contractor had obtained, prior to bid submittal, CAD drawings from the DOT’s engineering department. While temptingly easy to use, the CAD drawings were not part of the contract and could not be relied upon for quantity determinations.
A federal flood control contract stipulated a timeline for bid opening, contract award, and notice to proceed. The contract also contained a drawing note calling for performance in the summer and fall months. This was in direct conflict with the timeline. The contractor, having failed to seek clarification of the patent ambiguity in the contract documents, could not rely on the drawing note.
The third case in this issue involves the notice requirement in the standard AIA performance bond form. When the surety did not receive prompt notice of the default of its contractor, the surety was discharged of its obligations. The beneficiary of the bond was not entitled to engage in self-help remedies and then send the surety a bill.