This article was originally published in Government Construction (Volume 5, Issue 2 – Summer 2020), an ABA Division 13 Quarterly Newsletter. It is republished here with permission.

The United States Civilian Board of Contract Appeals (the “Board”) recently issued a decision that may be particularly pertinent in light of the COVID-19 pandemic. In Pernix Serka Joint Venture v. Department of State,1 the Board rejected a contractor’s claim for additional costs related to demobilization and remobilization of the job site in Freetown, Sierra Leone, due to an Ebola virus outbreak. The Pernix decision should put government contractors on notice that, depending on applicable contract language, federal contractors may be entitled to schedule relief, but not costs, as contractors deal with COVID-19 related impacts.
Continue Reading CBCA Offers Potential Insight Into How Board Will Handle Claims Related to COVID-19

COVID-19 has created a severe disruption to the construction industry. Certain jurisdictions, including Boston, San Francisco and Pennsylvania, have placed restrictions on construction projects deemed “nonessential” and require waivers for certain projects to continue. Owners, contractors, suppliers and others may currently have more questions than answers. This article addresses some important concerns, and provides links to additional resources that more specifically address these concerns.
Continue Reading COVID-19 and the Construction Industry: Important Considerations

This article was originally published on December 3, 2019 on ConsensusDocs. It is reprinted here with permission.

Construction contracts often include a “no damage for delay” clause that denies a contractor the right to recover delay-related costs and limits the contractor’s remedy to an extension of time for noncontractor-caused delays to a project’s completion date. Depending on the nature of the delay and the jurisdiction where the project is located, the contractual prohibition against delay damages may well be enforceable. This article will explore whether an enforceable no-damage-for-delay clause is also a bar to recovery of “acceleration” damages, i.e., the costs incurred by the contractor in its attempt to overcome delays to the project’s completion date.

Continue Reading Does a No-Damage-for-Delay Clause Also Preclude Acceleration Damages?

G&G Mech. Constructors, Inc. v. Jeff City Indus., Inc., No. WD80840, 2018 Mo. App. LEXIS 271 (Mar. 20, 2018)

This case arose out of a project in Columbia, Missouri on which Jeff City Industry, Inc. (“JCI”) was the general contractor and G&G Mechanical Constructors, Inc. (“G&G”) was a subcontractor.

The draft subcontract contained an interest provision which provided that overdue payments “shall bear interest at the annual rate of 18% or the highest rate allowed by law, if lower. Retainage shall not be held out of payment.”  JCI struck through this provision, wrote “5% Retiange [sic]” in the margin, initialed it, and sent it to G&G.  G&G also initialed the revision.

When JCI failed to pay G&G for its work, G&G sued JCI for breach of contract, unjust enrichment, and violation of Missouri’s Prompt Pay Act.  A jury returned a verdict against JCI, and the trial court entered a judgment against it which included prejudgment interest at the rate of 9% pursuant to Missouri Revised Statute § 408.020.
Continue Reading If You Want to Avoid Prejudgment Interest You Have to Expressly Say So in the Contract, Merely Striking the Interest Provision From the Contract May Not Work