When one thinks of construction scheduling, an objective, well-defined schedule is contemplated. Frequently, a critical path of activities is spelled out. It is surprising in this day and age that not all construction contracts include an objective schedule. One still sees contracts in which the contractor is required to work “diligently” or “expeditiously” and is instructed to perform “at the direction of” the project owner or prime contractor.

Parties are often comfortable with an ill-defined schedule. One reason is the belief that without an objectively stated schedule, there can be no liability for delay damages. This assumption is a fallacy.

In a recent case, a subcontract required the sub to “prosecute the work in a prompt and diligent manner whenever the work or any part of it becomes available.” The subcontractor was aware, however, of the prime contract schedule, including a planned seasonal shutdown of the sub’s portion of the work. The subcontractor mobilized one month after the site became available. When the prime contractor subsequently sought delay damages from the sub, the sub
argued that without a performance schedule in the subcontract, there could be no liability for delay damages. The subcontractor lost the argument.

Other cases this week involved the ability of a site preparation contractor to lien the property and a contractor’s right to seek indemnification from a geotechnical engineer. The site contractor’s work was “incidental to the construction of a building” even though the planned structure was never built. The contractor could lien the property. And, the contractor’s claim against the engineer was not barred by a statute of limitation because the contractual right to indemnification did not arise until the contractor settled a claim against it by the project owner.

Note: Twice a year – once in the summer and once at the end of the year – Construction Claims Advisor skips a week of publication. We skipped the week of July 4 as we celebrated our nation’s independence. The editorial staff at Construction Claims Advisor wish you a happy (belated) Fourth of July and a successful summer.