Volume 7 - Number 37 | September 21, 2009 - Construction Claims Advisor

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You are here: Home » Volume 7 - Number 37 | September 21, 2009

Volume 7 - Number 37 | September 21, 2009

EDITOR'S NOTES | Issue 7-37: Contractors frequently support delay claims with "as-built" schedules. When compared to an as-planned schedule, an as-built purports to show the impact of the other party's shortcomings on critical path construction activities, thereby establishing compensable delay. The problem is that as-built schedules are usually not maintained contemporaneously with contract performance. They are generated after a dispute has arisen.

In a case reported this week, a contractor's expert prepared an as-built schedule that was not tied to contemporaneous project records or the testimony of individuals with personal knowledge of events in the field. In fact, some assumptions in the as-built schedule were inconsistent with the contractor's daily reports and correspondence. Needless to say, this did not enhance the credibility of the as-built schedule.

Other cases reported this week address a deductive change order and the application of federal contract dispute procedures to a subcontractor's claim. A New York court allowed deletion of a substantial portion of the contract work without compensation for lost profit. And, the Montana Supreme Court upheld an injunction against arbitration of a subcontractor's claim for extra work.

EXPERT FAILED TO ESTABLISH ADDITIONAL DELAY BUT CONTRACTOR RECOVERS UNABSORBED OVERHEAD: An as-built schedule prepared by a contractor’s expert failed to establish compensable delay beyond that already conceded by the government. But, the contractor’s recovery was increased to reflect actual daily field overhead costs and 10 days of unabsorbed home office overhead.

CHANGES CLAUSE ALLOWED DELETION WITHOUT COMPENSATION FOR LOST PROFIT: A contract allowed a public project owner to delete a substantial portion of the work without compensating the contractor for lost or anticipated profit on that unperformed work.

FEDERAL DISPUTE PROCEDURES GOVERNED SUBCONTRACT CLAIM: A clause in a subcontract required disputes to be resolved under the federal contract dispute procedures if the interests of the federal project owner were involved. Although the subcontract contained an arbitration clause, the subcontractor could not arbitrate an extra work claim against the prime contractor.