enough people could get sick so that the domestic labor force in
various industries, including construction, could become significantly
impaired. Even if sufficient labor and materials are available,
“social distancing” requirements (which have been imposed
by executive orders in Illinois, Wisconsin and no doubt elsewhere)
can slow down many trades.
Any of these phenomena can lead to delay claims by owners
and other upstream parties. No one will win – except construction
litigation attorneys; some will just lose more than others. So, what
can you do now to avoid future lawsuits and advance your business
interests?
1. Pick up the phone/videoconference
Nobody is happy when work is delayed. But it is worse for an
owner/upstream contractor to learn it in the field by non-performance
than it is to learn it from the performing party in advance.
Use this time to build your relationships both upstream and
downstream. Call or videoconference your suppliers regularly to
keep tabs on material availability. Monitor your available workforce
and the workforces of any subcontractors for impacts on a
daily basis. By all means, convey this information to your customers
with your plan to maximize existing resources, rescheduling if
possible and to supplement where necessary. Even a call just to say,
“We’re okay at the moment,” works wonders. We are in business
just like you. People who contact us in tough times are the first
ones we will call back when times get better.
2. Briefly review your current contracts
COVID-19 has spared few businesses from having to manage, in
some way, shape or form, its effects. You’ve got plenty to do, so
your review for your own peace of mind should be brief. We’ve
found most people to be understanding of the legitimate impacts
of COVID-19. But if your pool of customers
is large enough, you are bound to run into
someone who doesn’t give a rat’s behind
of the circumstances we’re all facing: “Do
this job now or we’ll replace and sue you!”
Or sometimes, despite doing everything
you reasonably could, COVID-19 wipes out
your workforce or material availability is
zero. What then?
So much has been written recently
about the applicability of “force majeure”
provisions and COVID-19 that another article
would just be piling on. We’re familiar
with the law in this area and can assess
your individual contracts if you like, but
here is what to look for to prepare yourself
if you have a problem client.
Every contract is different, and form
contracts can be changed by agreement.
You should know what type of force majeure
clause you have in your contract(s). Is it
limited to specific events or types of events?
Does it broadly cover events outside of
your control? Maybe both, or neither. You
should know if you want to sleep at night.
a. For “original” (usually general) contractors, which may
apply to trade/subcontractors via a “flow-down clause” in its
subcontracts):
The use o f an unaltered, preprinted AIA A201-2017 form probably
will leave you in good shape; an unaltered ConsensusDocs 200
in even better shape. Section 8.3.1 of the AIA A201-2017 General
Conditions does not expressly use either “force majeure” or “Act
of God,” but the third and fifth clauses in § 8.3.1 provide examples
of what many consider to be force majeure events that excuse
timely performance:
§ 8.3.1 If the Contractor is delayed at any time in the
commencement or progress of the Work by…(3) labor
disputes, fire, unusual delay in deliveries, unavoidable
casualties, adverse weather conditions documented in
accordance with Section 15.1.6.2, or other causes beyond
the Contractor’s control;…; or (5) by other causes that the
Contractor asserts, and the Architect determines, justify
delay, then the Contract Time shall be extended for such
reasonable time as the Architect may determine.
The unaltered section 6.3.1 of ConsensusDocs 200 provides
as follows:
6.3.1 If Constructor is delayed at any time in the commencement
or progress of the Work by any cause beyond
the control of the Constructor, Constructor shall be
entitled to an equitable extension of the Contract Time.
Examples of causes beyond the control of Constructor
include, but are not limited to, the following: (a) acts
or omissions of Owner, Design Professional, or Others;
(b) changes in the Work or the sequencing of the Work
ordered by Owner, or arising from decisions of Owner that
impact the time of performance of the Work; (c) encountering
Hazardous Materials, or concealed or unknown
conditions; (d) delay authorized by Owner pending
CORONAVIRUS
You should know what type of
force majeure clause you have
in your contract(s). Is it limited to
specific events or types of events?
Does it broadly cover events
outside of your control? Maybe
both, or neither. You should know
if you want to sleep at night.
98 | ISSUE 2 2020 www.piledrivers.org
/www.piledrivers.org
