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Protect yourself from costly project delays

April 4, 2017

Plan for the best, prepare for the worst. That’s what contractors must do to protect themselves from costly project delays.

Pay attention to details in project delay claims

Your biggest project just changed course, maybe due to a supplier delay or design change. Neither of these is your fault, but they affect you and could cost you. You can avoid misunderstandings with some proactive measures.

Clarify contracts and schedules

Put provisions in your contract that make it easier for you to recover any delay damages on a project and know what part is your responsibility and what is not. Keeping track of schedules can get complicated because contractors and owners typically use different methods to track projects. No matter the form, the schedules should outline each party’s responsibilities so the documents can be used to establish the cause of any claimed delay.

Document and communicate regularly

Equally important is how you handle these measures. “Construction delays are often unavoidable. But the risk of expensive delay claims and the resulting damages can be greatly minimized by practicing good record keeping, clear communications, a thorough understanding of the relevant contract terms, and maintaining accurate schedules,” says Rich Capriola, Esq., a partner at Atlanta-based Winter Capriola Zenner LLC.

Based on his extensive experience representing subcontractors and owners in all types of construction issues, Capriola offers these suggestions.

First, maintain good records and communicate about schedule changes and unexpected delays immediately and in writing. Follow conversations with confirming emails. Have field personnel maintain accurate notes and logs that record daily activities, and cite any problems or delays that affected the scheduled work. It can be difficult, months or even years later, to recall what happened on a specific day—but that level of detail is exactly what you need for most delay claims.

Second, understand how the risks of delays are allocated among the parties signing the contract. Avoid “no damages for delay” clauses and other similar waivers or restrictions on your ability to recover your extra costs if your work is delayed through no fault of yours. Take that risk into consideration before accepting the job.

Third, keep your schedules current and ensure that they reflect any changes that come up during onsite meetings. Field personnel should have copies of the current schedule at their fingertips every day. Regularly compare your schedule to the master owner or general contractor schedule, and point out any discrepancies in writing. All changes to the critical path should be documented or confirmed in writing via letter or email. Any objections to those changes should be noted when the new schedule is released. Immediately report all situations that develop onsite that delay your progress.

Get more details at AWCI

Capriola will discuss this topic at the annual Association of the Wall and Ceiling Industry Convention & Intex Expo in Las Vegas this year. In the March 29 session called “Speed Bumps on the Critical Path: Best Practices for Delay Claim Preparation, Defense and Avoidance,” Capriola and his co-presenter Eric Coleman Esq., also of Winter Capriola Zenner, will offer real-world examples about how these situations develop and ways to protect yourself from them.

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