By Bruce Jervis
Contractor recovery for the cumulative impact of multiple delays has always been controversial. It seems logical that repeated delays affect productivity and increase costs. But it is difficult to quantify. And, of course, there are questions of causation or responsibility for the various delays.
Adding to the complexity of cumulative impact claims are contract clauses requiring prompt written notice of changed or delayed work, along with quantification of increased costs. Cumulative impact costs cannot be calculated until the end of the project. Contract clauses mandating quantification shortly after the claim “event” effectively bar recovery for cumulative impact.
In a recent case from Connecticut, a utility contractor encountered almost 800 unidentified subsurface interferences. The contractor could not recover cumulative impact costs, however, because delay damages had to be quantified within 10 business days of each delay event. Under the contract’s change order procedure, the right to cumulative impact costs had been waived.
Are cumulative impact costs phantom? Should recovery ever be allowed? There are mathematical methods for calculating lost labor efficiency with persuasive accuracy. Yet, change order and claim administration clauses effectively waive these damages. What is your opinion?
