A no-damages-for-delay clause can bar contractor claims for additional costs a contractor incurs due to delay on a project. Such clauses can be controversial, and at least one state—Virginia—has enacted a statute limiting the use of no-damages-for-delay clauses on public construction projects.
Regardless, many courts will enforce a no-damages-for-delay clause. But there can be…
Owners may argue that a contractor’s delay claim is barred because the contractor signed a release during construction of the project. Owners may also argue that a delay claim is barred because there was an accord and satisfaction regarding such a claim.
While the defenses of release and accord and satisfaction are often lumped together,…
Many construction contracts require a contractor or subcontractor to continue to work during a pending dispute between an owner and a contractor or a contractor and subcontractor. One purpose of requiring continued performance is to ensure that good faith disputes will not prevent the timely completion of a project.
Will a continue-performance-during-disputes clause prevent a…
I have written many posts about the enforceability of liquidated damages clauses in construction contracts—a topic that interests many people in the construction industry.
Occasionally, you may see an owner argue that under a liquidated damages provision, the owner has the option to either assess liquidated damages for the late completion of a…
A performance bond ensures that the bonded contractor or subcontractor will complete its work on a project. If a bonded contractor or subcontractor defaults, the surety should step in and exercise one of its options under the bond, which typically includes arranging for the completion of the defaulted contractor’s work.
Often, before a surety’s obligation…
There are many important provisions to include in joint-venture agreements between contractors pursuing a project. (For a list of five important provisions to include in joint-venture agreements, click here.) One important thing to address in a joint-venture agreement is how capital contributions will be handled.
Here are questions to consider when drafting a capital…
Builder’s risk insurance is a type of property insurance that covers damage to a project under construction. A builder’s risk policy is a no-fault form of insurance—it doesn’t matter who is responsible for the loss, builder’s risk will typically cover the loss.
There are times where a contractor’s faulty workmanship may cause a loss to…
Are liquidated damages clauses in construction contracts enforceable? That’s a question that is often litigated in construction disputes.
It’s not surprising that some of the most popular articles on this blog address examples of courts refusing to enforce liquidated damages clauses in a construction contracts. For two examples of Florida courts finding liquidated damages clauses…
Constructive acceleration occurs when a project owner requires the contractor to comply with the original completion deadline, even though the contractor has encountered an excusable delay.
Some courts have held that there are three “essential elements” of a constructive acceleration claim: (1) the contractor encountered an excusable delay, (2) the owner issued an acceleration order,…
The enforcement of liquidated damages provisions is a topic that gets a lot of attention in construction-contract disputes. Some of the most popular posts on this blog include examples of courts refusing to enforce liquidated damages provisions. (Click here for one example and click here for another example.)
One reason a court may refuse…
