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Volume 5 - Number 11 | March 12, 2007
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EDITOR'S NOTES
Service-oriented companies often tout that the customer is always right. This approach may work if you are ordering a meal at a fast food establishment, but in the construction industry, a better motto is this: “Get it in writing!” This week’s set of cases deal with problems that arise when the written word (or lack of it) is called into question.
In our first case, a project owner argues that the arbitration clause in its contract is void once it terminates the contract for default. Not so, says a Florida appellate court. Because the project was substantially complete when the owner fired its contractor, the conflict management portion of the contract still stands.
Next, a contractor on a government project must proffer written verification to prove that the contract was altered to allow a payment adjustment for liquidated damages. Verbal agreements aren’t enough.
Even when a written agreement is in place, it is often open to interpretation. In our third case, a state high court considers whether a general contractor’s CGL policy covers faulty workmanship of its subcontractor.
This issue concludes with a look at what happens when schedulers misappropriate lag time in their schedules. The article, by Jens Baker, offers some ways to avoid this problem.
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LIQUIDATED DAMAGES AGREEMENT REQUIRED CONTRACT MODIFICATION
When a contractor negotiates a payment adjustment for liquidated damages on a government project, it needs to procure written documentation from the contracting officer to support the contract change. Otherwise, the adjustment is unenforceable.
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LAZY CONCRETE
By Jens Baker
Lazy concrete is not a concrete mix that refuses to cure. Rather, it’s a phenomenon that occurs when schedulers fail to properly program cure time into the schedule. Guest columnist Jens Baker offers the scheduling cure-all to combat this problem.
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