Commentary from Bruce Jervis, Esq.
Editor, Construction Claims Advisor
Construction contracts sometimes stipulate not only a final completion deadline, but also interim completion milestones the contractor must achieve. Interim milestones impose additional scheduling and performance risks for the contractor. The project owner may direct acceleration of the pace of the work with no additional compensation if necessary to meet contractually stipulated milestones.
In a recent case, a contract stated an assumed – but not guaranteed – date for issuance of notice-to-proceed. The contractor was required to submit a planned schedule of major activities based on that start date. Notice-to-proceed was issued a month later than the assumed date. The contractor was forced to accelerate its work in order to achieve interim completion milestones. Was the project owner obligated to extend the milestone dates as the result of the late start? Or were acceleration costs simply a risk the contractor accepted under the contract?
I'd like to know how you deal with interim milestones in contracts. Do contractors ever formally request extensions of milestone dates? Would project owners grant such an extension or would they adjust only the final completion deadline? I welcome all comments.
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