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Addressing the issue of delays in construction contracts, disputes, P.2

Previously, we began looking at the issue of construction delays and the potentially significant costs associated with them. As we noted, construction delays often do not come with drastic costs until they result in delays in the overall construction project.

One way of addressing the issue of delays is to build in extra time to the contract. Any well-drafted construction contract, especially contracts for projects involving multiple phases and subcontractors, will include a certain amount of float or slack time for different phases of the project. This gives the parties involved in each phase of the project extra time, if necessary, to handle issues that come up without causing delays in the overall project. 

Another important way of addressing delays is to specify what rights and obligations arise when specific delays occur. Some delays can be categorized as excusable for the contractor, and can entitle the contractor to a time extension to complete the project. Other delays may be both excusable and compensable, entitling the contractor to both a time extension and to compensation.  Some delays can be categorized as unexcused, and can entitle the property owner to delay damages.

Several other issues that can come up in construction projects, and which should be addressed in construction contracts, are the right to complete work early, concurrent delays and float apportionment. The right to complete work early refers to situations where an owner causes delay to a construction project, but the overall project is not actually delayed because the contractor was on track to finish the work early. The question is whether the contractor should have the right to be compensated for the delay.  

In our next post, we’ll look at concurrent delays, float apportionment, delay damages, and the importance of working with an experienced attorney to address these issues both in construction contacts and when disputes arise. 

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