Before Making a Construction Delay Claim, Count the Costs

A common source of dispute in construction projects is delay of the work. Before making a claim to extend the time for performance or to recoup additional costs, however, contractors should undertake a thorough investigation to see if the claim will stick.


Towson, Maryland, July 10, 2012 (GLOBE NEWSWIRE) -- A statement from Michael Siri, a partner in Bowie & Jensen's litigation department, assisting clients with a variety of legal issues. His practice focuses on commercial litigation, including construction law. He has worked on matters at all stages of litigation in both state and federal courts, as well as, administrative hearings and arbitrations.
 

A common source of dispute in construction projects is delay of the work. Before making a claim to extend the time for performance or to recoup additional costs, however, contractors should undertake a thorough investigation to see if the claim will stick.

A claim for delay arises from the period in which the construction project has been extended or work has not been performed because of unforeseen circumstances. These unanticipated circumstances may include differing site conditions, changes in the scope of work, defective plans and specifications, and interference by other contractors. Such delays may result in a contractor having to increase manpower on the project, require overtime for labor, and incur additional costs to complete the project. Contractors may be entitled to an extension to complete the work or recoupment of the additional costs related to the delay.

Here are the initial steps to evaluating the likely success of such a claim:

1.         Review. Check the contract to determine notification requirements related to any claim.  As may be required in the contract, notify the appropriate parties (i.e. architect, owner, general contractor, engineer) within the time prescribed and with supporting documentation. A contractor must ensure that it does not waive its right to bring forth a delay claim by failing to properly notify the appropriate party within the required time.

2.         Ask Around. Talk with your project manager and other workers on the project to determine the reasons for the delay and to obtain all relevant documentation for submitting a potential claim. Communication with the project manager is essential, as he or she is the eyes and ears on the project and should know the relevant facts of the delay.

3.         Collect all relevant documents.  Among other documents, you will want to include all correspondence between the parties, daily reports, time cards, photographs, invoices, purchase orders, any notes taken by your project manager, and meeting minutes. Essentially, anything that will help or hurt your claim should be part of the document gathering.

4.         Determine your damages. What has the delay cost you? This may include direct and indirect job costs, administrative costs, and profits. Keep in mind that the contract may limit the type of damages that a contractor may recover; however, it is important to figure out what the damages are in making your evaluation.

5.         Consultation.            Consult your attorney to ensure that all legal avenues have been considered and to confirm the validity of your potential claim.

Taking these initial steps will assist in evaluating the strengths, and possible weaknesses, of your potential delay claim. 

Mr. Siri routinely counsels the firm's construction law clients on issues involving various aspects of a construction project, including contract formation, mechanic's liens, bid protests, delay claims, and payment issues. As part of the firm's construction law group, Mr. Siri provides legal guidance to individuals, general contractors, subcontractors, developers, and businesses. Mr. Siri's practice extends beyond construction law. He has successfully represented clients in matters involving commercial litigation, including, but not limited to, claims arising out of breaches of contract, shareholder derivatives suits, receiverships, corporate dissolutions, employment claims, and litigation arising out of the administration of estates.For further information please contact Michael Siri at (410) 583-2400 or siri@bowie-jensen.com.



            

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