Price Escalation Impacts

This Bulletin provides guidance to contractors, subcontractors, suppliers, and others to ensure compliance with contractual change order requirements in the event work on a construction project is impacted by price escalation.

Construction projects are being impacted by increased costs for most construction materials. The Producer Price Index shows a 69% increase in the cost of construction materials from March 2020 to March 2022. Many construction contracts do not address escalation or specifically exclude change orders for material escalation, leaving the risk of escalation of construction materials with the contractor, subcontractor, or suppliers.

Bid Protection Tips:

  • Keep bids open for less than 30 days with a designated sunset date:
    • Keeping your bids open for less than 30 days can help protect you from sudden changes in pricing and help maintain your bids’ competitive status.
    • If asked to extend time a bid is open, reconfirm prices before agreeing.
  • Lock in material prices and confirm agreement:
    • Getting a signed, written agreement with your supplier – that notes the specific price agreed to – will be extremely valuable.
  • Consider Specific Proposal Terms:
    • Make sure to include in your bids/proposals language such as:
      “Upon release by customer to proceed to purchase raw materials, this proposal becomes a binding agreement.”
    • If you include this language in a proposal, make sure that the proposal is specifically incorporated by reference into the contract.

Contract Protection Tips:

We also recommend that you check all contracts for an Escalation Clause, which will compensate you in the event there are increases in raw material or equipment costs. Look for a clause like this:

Material prices, including construction materials, are based on current prices at the time of the Proposal. Any significant price increases (meaning a price increase exceeding (10%) in materials necessary to perform the work, that occur during the period of time between the date of this Proposal and Substantial Completion of the Project, shall cause the contract price to be equitably adjusted by an amount reasonably necessary to cover any increase. Further, if material or equipment required by the contract are not available due to shortage or unavailability or if the price to procure such material or equipment increases as set forth in this provision, then an acceptable substitute shall be found and an adjustment in the contract price shall be made accordingly. Contractor shall be entitled to an extension of time for any delay in obtaining delivery of the item necessary for completion of the Work.

Additionally, define unavailability to obtain materials as an excusable delay or force majeure event in the contract.

If the contract does not include an escalation provisions, you should revise to include a provision. Check the Prime Contract to see if escalation has been addressed. If so, the owner and the contractor should not object to including an escalation provision in downstream contracts.

Supply Protection Tips:

  • Negotiate for release of funds to make early purchases when needed.
    • Negotiate contracts that allow you to purchase materials in advance to avoid a price increase or product unavailability.
  • Confirm product lead times in advance of project needs;
    • Put a hold on material verified to be in stock.
    • Make purchases early when feasible.
    • Obtain guarantees from your suppliers.

Price Escalation Action Items:

If you experience a price escalation impact, it is imperative that you comply with the notice provisions of your contract and track your actual time and damages:

  1. Keep meticulous records of all increased expenses and provide supporting documentation as required to obtain payment.
  2. Track your material costs to establish the increased cost versus the amount at bid.
  3. Follow the recommendations set forth in GRSM Construction Bulletin – Protect Your Right To Payment.

For questions, contract Denise M. Motta.

Force Majeure Recommendations

This Bulletin provides guidance to contractors, subcontractors, suppliers, and others to ensure compliance with contractual change order requirements in the event work on a construction project is impacted by a force majeure event.

Contract Protection Tips:

A force majeure event is defined as an unforeseeable circumstance that prevents someone from fulfilling a contract. Because many events arising on a construction project could be arguably unforeseen, it is imperative that the contract contain a Force Majeure provision. Examine all contracts for the applicable Force Majeure provision. Look for a clause like this:

§ 8.3.3     Any failure or omission by Owner or Contractor in performance of its obligation shall not be deemed a breach or create any liability for damages or other relief (other than additional time) if it arises from any cause beyond the reasonable control of such party, including, without limitation, acts of God, floods, fire, explosions, storms, earthquakes, acts of public enemy, war, terrorism, rebellion, insurrection, riot, sabotage, invasion, epidemic, quarantine, strikes, lockouts, labor disputes or other industrial disturbances, or any order or action by any governmental agency, or causes of similar nature.

In the aftermath of the COVID-19 pandemic, a variety of Force Majeure clauses have been added to construction contracts. Given supply chain issues, it is advisable to include a clause addressing specific supply chain impacts provided by the contractor or supplier providing: “lack of or failure of or other inability to obtain necessary transportation, fuel, power, materials, machinery, equipment or facilities, delays caused by other contractors, subcontractors or their subcontractors of any tier, or any materialmen or suppliers” Also, it is recommended that the clause specifically provide: “Any such delay shall extend the time for completion of the contract by not less than the duration of the delay.”

Force Majeure Event Action Items:

If you experience a force majeure event, it is imperative that you comply with the notice provisions of your contract and track your actual time and damages.

  1. Provide notice and request for a time extension, as well as associated costs. Notice should be provided in accordance with the contract provisions. Remember to check the timing of notice (e.g., within 5 days of occurrence of the event) and the method of notice (e.g., in writing delivered by certified mail return receipt requested). If your contract does not contain specific requirements of what must be included in the notice, the following Example Notice Language may be used:

    At this time, [Contractor/Subcontractor/Supplier] is being delayed by a Force Majeure Event, which is outside of its control. [Describe Event]. [Contractor/Subcontractor/Supplier] has been impacted by the Force Majeure Event. Among other impacts, we continue to face impacts to our labor force and disruptions to the delivery of material and detailing services.

    It is impossible to notify you of the full impact the Force Majeure Event will have on costs and schedule; however, we hereby request a day-for-day extension. [Contractor/Subcontractor/Supplier] will submit its costs associated with this impact along with documentation of the schedule impacts. [Contractor/Subcontractor/Supplier] reserves all rights that it has under the contract and applicable law to an extension of time for any delay and costs that result from this force majeure event.

  2. Check all contracts for clauses relating to compensation in the event of a shutdown or delay. Is there a No Damages for Delay Clause? Look for a clause like this:

    No claim for damages . . . other than for an extension of time shall be made or asserted against the owner for any reason whatsoever. The contractor shall not be entitled to an increase in the contract sum or payment or compensation of any kind from the owner for direct, indirect, consequential, impact or other costs, expenses or damages, including but not limited to costs of acceleration or inefficiency, arising because of delay, disruption, interference from any cause whatsoever.

If there is an enforceable No Damages for Delay Clause, begin considering mitigation options that will reduce your job site overhead and general conditions, such as the ability to return rented equipment during any project suspension.

  1. Check contract for Supply Chain Delay provision.
  2. Check contract for Price Escalation provision.
  3. Keep meticulous records of all damages arising from any delay and increased expenses and provide supporting documentation as required to obtain payment.
  4. Follow the recommendations set forth in GRSM Construction Bulletin – Protect Your Right To Payment.

For questions, contact Denise M. Motta.

Supply Chain Delay Recommendations

This Bulletin provides guidance to contractors, subcontractors, suppliers, and others to ensure compliance with contractual change order requirements in the event work on a construction project is impacted by supply chain delays.

Contract Protection Tips:

The construction industry is being impacted substantially by inability to obtain necessary construction products due to supply chain issues. Most construction contracts do not accommodate time extensions due to supply chain impacts. To address this gap in contract terms, we recommend including language such as: “lack of or failure of or other inability to obtain necessary transportation, fuel, power, materials, machinery, equipment or facilities, delays caused by other contractors, subcontractors or their subcontractors of any tier, or any materialmen or suppliers” as part of the defined force majeure event under the contract.

This provision can be included in the Change Order section of the contract as well by including a provision such as: “If the Work is delayed by the failure of or other inability to obtain necessary transportation, fuel, power, materials, machinery, equipment or facilities, delays caused by other contractors, subcontractors or their subcontractors of any tier, or any materialmen or suppliers, contractor shall be entitled to a change order for its costs and time associated with the delay.”

If the contract does not include a supply chain provision, you should revise to include a provision. Check the Prime Contract to see if supply chain delays have been addressed. If so, the owner and the contractor should not object to including supply chain provision in downstream contracts.

Supply Chain Delay Action Items:

If you experience supply chain delay, it is imperative that you comply with the notice provisions of your contract and track your actual time and damages.

  1. Provide notice and request for a time extension, as well as associated costs.
    Notice should be provided in accordance with the subcontract provisions. Remember to check the timing of notice (e.g., within 5 days of occurrence of the event) and the method of notice (e.g., in writing delivered by certified mail return receipt requested).
  2. Check all contracts for clauses relating to compensation in the event of a shutdown or delay. Is there a No Damages for Delay Clause? Look for a clause like this:

No claim for damages . . . other than for an extension of time shall be made or asserted against the owner for any reason whatsoever. The contractor shall not be entitled to an increase in the contract sum or payment or compensation of any kind from the owner for direct, indirect, consequential, impact or other costs, expenses or damages, including but not limited to costs of acceleration or inefficiency, arising because of delay, disruption, interference from any cause whatsoever.

If there is an enforceable No Damages for Delay Clause, begin considering mitigation options that will reduce your job site overhead and general conditions, such as the ability to return rented equipment during any project suspension.

  1. Keep meticulous records of all damages arising from any delay and increased expenses and provide supporting documentation as required to obtain payment.
  2. Follow the recommendations set forth in GRSM Construction Bulletin – Protect Your Right To Payment.

For questions, contact Denise M. Motta

Protect Your Right To Payment By Following Nedd

In order to preserve your right to payment, you must satisfy the contractual requirements supporting a change order for the increased costs or time due to the delay. The key to the successful presentation of change order claims is educating your team on the following:

1.    NOTICE

  • Review the change order and notice provisions of your contracts. Make your contract searchable and insert the term “Noti” and look for the items listed below.
  • Who:  Check the designated representative for notice.

  • It may not be the project manager.

  • Confirm who can authorize the change order.

  • Is owner approval required?

  • Ensure that the party approving the change order has authority to do so.

  • What:  Check for specific information required by the contract.

  • Provide ALL information available.

  • If certain information is not yet available, state that the information will be provided when available.

  • Reserve all rights to amend and submit additional information.

  • Request both an increase to the Contract Sum and Contract Time.

  • Make the request even if you do not believe the delay or time necessary will cause a significant impact.

  • When:  Check the time deadline for notice.

  • Does the contract provide for waiver if notice is not provided?

  • How:  Check the method for providing notice.

  • Does it require certified mail?

  • Is email sufficient?

  • If email is not proper notice, be sure to issue via the required method in addition to email.

  • IF YOUR CUSTOMER DOES NOT ALLOW A TIME EXTENSION OR REJECTS YOUR NOTICE, respond and provide further notice that you consider the rejection a “Constructive Acceleration” and will be forced to incur overtime and other potential labor, material, and equipment costs.

2.    ENTITLEMENT

  • Prepare and submit an entitlement packet that demonstrates your legal and factual entitlement to a change.

  • Legal Entitlement: Review your contract for clauses that would allow for the recovery of delay and/or acceleration costs, or look for common law options that may invalidate no-damages-for delay clauses such as the delay was “beyond the contemplation of the parties” or if you were “constructively accelerated”.

  • Search your contract for the following terms:

  • “Excusable Delay”

  • Delay

  • God (Acts of God)

  • Epidemic

  • Quarantine

  • No Damages for Delay

  • “Time Extension”

  • “Sole Remedy”

  • “Accelerat” – Acceleration damages are different from delay damages. If you request a time extension and are not granted the extension, you may have a claim for directed, or constructive acceleration.1

  • Factual Entitlement: Prepare a comparison demonstrating the impact on your baseline schedule from your planned schedule.

  • Supplement entitlement packet to substantiate the basis for the change order.

  • Track and document each day of delay through schedules, time sheets, daily reports, payroll documentation, or other project records.

  • Provide updated entitlement packet to support change order request as information is updated.

  • Save the entitlement packet and all supporting information where it can be easily located, updated, and shared.

3.    DAMAGES

  • Track and document amount of actual costs incurred (to the extent possible).

  • Monetary Damages may include:

  • Increased cost of materials

  • Increased cost of labor

  • Increased cost of equipment rental charges

  • Storage of materials

  • Additional supervision or field costs for the extended duration

  • Costs associated with de-mobilization and re-mobilization

  • Lost overhead and profit

  • Costs for extended general conditions, equipment costs, or rental costs

  • Additional bond or insurance premiums

  • Tax implications

  • Document and provide proof of ALL Expenses:

  • Labor – Compare original estimated hours with actual hours delayed or spent in overtime.

  • Use daily time cards, certified payroll, daily reports, or a separate phase code in your job cost accounting to track actual labor delays and impacts.

  • Materials – Gather notices from suppliers relating to increased costs and delays. Gather the invoices and checks showing payment for any increased costs.

  • Equipment – Gather proof of down-time hours through daily time cards, certified payroll, daily reports, or a separate phase code in your job cost accounting to track labor.

  • Be prepared to produce your rental agreement of proof of cost and payment for rental.

  • Overhead and Profit – Cite to contract section setting forth allowable OH&P on changes.

  • Storage, Subcontractor and Vendor Costs – Produce invoices and proof of payment for increased costs resulting from delays and acceleration.

4.    DON’T WAIVE YOUR CLAIMS

  • Check language in ALL lien waivers and ALL payment applications and ALL change orders to make sure (1) pending claims, (2) unpaid contract balances, and (3) unpaid retainage are not waived.

  • Be aware of potential releases included in online payment applications (Textura).

  • Confirm that contract does not provide that acceptance of payment is a waiver of all claims.

  • If it does, consider whether to accept payment.

  • Be aware claim deadlines.

  • Follow dispute resolution procedures in the contract (including time provisions).

  • Be aware of statute of limitations to file lawsuits.

  • Bond and lien claim deadlines.

 

For questions, contact Denise M. Motta.


1 A claim for constructive acceleration arises where (1) there is an excusable delay; (2) you properly request a time extension; (3) the request for extension was denied; (4) you were ordered to complete the project by the original completion date despite the excusable delay; and (5) you accelerated performance and incurred additional costs. A claim for directed acceleration arises where (1) you are ordered to accelerate (perform in a shorter period than originally allowed by the contract schedule); (2) the delays prompting the acceleration were excusable; and (3) you accelerated performance and incurred additional costs.

What You Need to Know About Delay Claims and How to Prove or Defend Against Them

It is inevitable that a steel fabricator will be delayed or be accused of delay on a project.  There are many considerations that go into proving and defending delay claims.  From a legal perspective, several issues must be addressed: (1) the type of delay; (2) proof required for delay claims; and (3) types of damages.  This article addresses the legal implications of proving and defending delay claims.

Overview of Delay Claims

Delay damages may be awarded when the defendant has caused the period of performance to be extended.[1]  Delay damages can fall into any of the three general categories of contract damages: (1) expectation; (2) reliance; or (3) restitution.[2]  To prove any delay claim, expert testimony is generally necessary.

A. Elements and Types of Damages

To prove a delay claim, the delayed party must show: (1) the defendant was responsible for the delay; (2) the delays caused a delay in completion of the contract (eliminating overlapping or duplication of delays); and (3) the plaintiff suffered damages as a result of those delays.[3] Once contract time becomes impacted, the impact must be analyzed to determine: [4] [5]

  1. Its cause;
  2. Whether the cause is within the “control” of either party;
  3. Whether the cause impacted the contract’s “critical path” for completion and; if so,
  4. By how much.

The party alleging delay has the burden of proof and must prove each of the elements listed above.  To do so, the delay itself will need to be analyzed to establish the cause of the delay and who was responsible for the delay.  Importantly, the delay must impact the critical path of the project.  Further, the alleged damages must be proven by a reliable method.  Each of these components requires the use of a delay expert to analyze the project schedule so as to determine whether there was a critical path delay and the responsible trade.  Further, the delay expert will need to conduct a detailed analysis to prove and/or defend against alleged damages.

B. Types of Delay

There are multiple types of critical path delays. Whether a delay is compensable depends on the nature of the delay.  Additionally, the contract terms will also be considered in determining whether a delay is compensable or if the delayed party is only entitled to a time extension.

1. Excusable and Compensable

In order to be compensable, a delay must be caused solely by the delaying party to qualify as compensable.  However, third-party delays may be compensable as well depending on the provisions of the contract.  For compensable delay, one must prove that the scheduled completion date of the project has been extended.[6]

Courts turn their focus first to the contract language to determine the scope of excusable and compensable delays.  For example, in Kiewit Power Constructors, the court determined the contract defined excusable delays to be “those resulting from circumstances beyond the reasonable control and without the fault or negligence of the [delayed] party.”[7]

While the general rule is that there can be no recovery for concurrent delays, in some cases where multiple subcontractors or multiple prime contractors are simultaneously responsible for delay, the delayed party may still be able to recover its costs split between the responsible parties as long as the claiming party had no fault or responsibility for delay during the period claimed.[8]

2. Excusable But Not Compensable

Excusable, but not compensable delays typically result from “third-party events, force majeure events, unusually severe weather, and owner-caused delays.”  The compensability of these types of delays depends on the provisions of the contract.  If the delay is outside the control of both the owner and the contractor, it could be “excusable but non-compensable.”[9]

Courts have found that concurrent delays generally are not compensable: “[i]f a period of delay can be attributed simultaneously to the actions of both the [Owner] and the contractor, there are said to be concurrent delays, and the result is an excusable but not a compensable delay.”[10]

3. Not Excusable[11]

Delays are not excusable when the delay results from an act or neglect of the contractor, or its subcontractors or suppliers at any tier, or is the result of a risk assumed by the contractor pursuant to contract.  Because these delays may be caused by negligence or poor performance of the contracting parties, they are controllable.[12]

Non-excusable delays are usually rooted in at least some of the following causes: improper scheduling, ineffective site management, incorrect methods of construction, delayed performance in overall activities, and poor monitoring and control.[13]  Many commentators address this type of delay as a defense to a contractor’s claim for an extension of time, but the theories that apply also implicate the government or owner’s entitlement to assess liquidated damages.[14]

C. Methods of Proving Delay Damages

A damage award must not be based on mere speculation, guess, or conjecture.  Courts have interpreted this to mean that time impacts and resulting damages must be measured with a heightened “degree of certainty,”[15] leading to judicial skepticism of theoretical time impact analyses and damage presentations based on unsegregated “total cost” methods.[16]  Damages must be proven by reliable expert testimony or the delayed party runs the risk of not being awarded damages.

1. Measured Mile Analysis

A measured mile analysis compares the actual labor costs or labor productivity of performing work during a time period in which the work was not impacted by the actions causing labor inefficiency to the actual labor costs or actual productivity rate for performing work during a period that was impacted by the delay.[17]  A measured mile analysis has the ability to “isolate the productivity loss during an impacted period from all other project factors via achieved progress in an un-impacted period” and is considered the preferred method of proving damages.[18]  By and large, a measured mile analysis is the most “reliable,” and therefore, preferred method.

2. Total Cost Method

The total cost method involves subtracting the contractor’s bid estimate from the total of all project cost incurred, producing a total cost attributable to the owner’s breach.[19]

The total cost method has been applied by some courts only under exceptional circumstances and even then, only as a last resort.[20]  In those cases, courts may allow proof of damages by the total cost method when there is no other alternative method of computing damages.[21]

3. Modified Total Cost Method

The modified total cost method is allowed only when the evidence suggests proving damages by any other means might be impracticable.[22]  To prove a modified total cost claim, the plaintiff must prove “that (1) the nature of the particular losses make it impossible or highly impracticable to determine them with a reasonable degree of accuracy; (2) the plaintiff’s bid or estimate was realistic; (3) its actual costs are reasonable; and (4) it was not responsible for the added expenses.”[23]

If successful, the modified total cost method will result in an award of the total cost of the contract minus the bid price, with adjustments made for a contractor’s inability to satisfy the four elements, such as excluding costs associated with delays the contractor caused, or adjusting the bid price for miscalculations.[24]

D. Common Breakdowns of Delay Damages

Damages from delay can come in various forms.  Impacts include increased labor costs, increased material and equipment costs, overhead, and loss of efficiency or productivity.  When asserting a delay claim, it is important to adequately track any direct costs (labor, material, or equipment) with appropriate backup when a project is delayed.  Conversely, when defending a delay claim, it is crucial to ensure that damages are supported and, for loss of efficiency or productivity claims, supported by reliable expert testimony.

1. Labor Costs

Extended or additional labor costs impact nearly every party in connection with project delay.  Delays to a project can force the contractor to perform work out of sequence, under different labor conditions, or at a later time.  Each of these will impact the work and result in an increase in labor costs.  For example, a delay that pushes work into a later period can result in stacking of trades, disruption of trades, and slower progress.  If pushed to a later time, work that previously had no shortage of trained labor could face shortages or unrest as labor agreements are impacted.  However, not all labor costs should be considered part of damages due to delay. Rather, the damages are for the labor actually impacted by the delayed work.

2. Material and Equipment Costs

Equipment standby damages usually “take the form of lost opportunities to rent idle equipment to others or the plaintiff’s inability to use the equipment at an earlier date on another job.”[25]  Such losses—when foreseeable—are “a natural consequence of the . . . delay, and, thus, are compensable.”[26]  Courts may award the plaintiff its lost profits and unavoidable costs (namely, its equipment leasing costs).[27]  The court will examine the damages to place the plaintiff in the position it “would have occupied had [the delaying party] performed the contract.”[28]

3. Direct and Indirect Overhead

“Unabsorbed overhead” may be recoverable as part of delay damages.  “[I]f the delay prevented the contractor from obtaining contracts during the delay period that would have ‘absorbed’ the ongoing overhead expenses,” the unabsorbed overhead is recoverable.[29]

4. Loss of Efficiency/Productivity Claims

In construction delay claims, disruption can be compensable when it results in: (i) a “loss of productivity; (ii) caused by a change in working conditions; (iii) for which the owner is responsible.”[30]  Whether a contractor is entitled to recover the increased costs of disruption “depends on the nature of the disruption, the cause of the loss of productivity, and on the terms of its contract as may be interpreted in the light of industry practice.”[31]  Of particular note, timing factors are common causes affecting project productivity and efficiency.  For example, acceleration,[32] out-of-sequence work,[33] schedule compression,[34] and simultaneous operations.[35]

Disruption is a separate and distinct phenomenon from delay.[36]  Federal courts have noted that “[t]here is a distinction in the law between a delay claim and a disruption or cumulative impact claim. Although the two claim types often arise together in the same project, a delay claim involves the time and cost of not being able to work, while a disruption claim involves the cost of working less efficiently than planned.”[37]  Indeed, in order to “succeed on a disruption [or loss of productivity claim]” a claimant “need not establish delay to overall contract completion.”[38]

Finally, courts have articulated that a high level of proof is required to prove loss of productivity or efficiency.[39]  Mere assertions of delay or changes in a project fail to constitute adequate proof.[40]  A party asserting loss of productivity must firmly establish the elements of liability and causation, or that disruptions or inefficiencies on the project were caused solely by the alleged project delays or changes.[41]

Courts generally require the testimony of a properly qualified expert witness to prove the amount or impact of lost productivity.  In Luria Brothers & Co. v. United States, the court stated:

It is a rare case where loss of productivity can be proven by books and records; almost always it has to be proven by the opinions of expert witnesses.  However, the mere expression of an estimate as to the amount of productivity loss by an expert witness with nothing to support it will not establish the fundamental fact of resultant injury nor provide a sufficient basis for making a reasonably correct approximation of damages.[42]

Indeed, the failure to use an expert has resulted in many courts finding the claimant unable to meet the required burden to prove inefficiency.[43]

Conclusion

Practical tips to consider when met with delays include: (1) conducting a critical path delay analysis to determine the party responsible for the delay; (2) retaining a delay expert to consult regarding schedule issues; (3) being mindful of deadlines set forth in the contract for requesting change orders, including requests for time extensions; (4) requesting a time extension when impacted by delays; (5) including additional days for completion of change orders in each change order; (6) tracking all labor, material, and equipment expenses with a separate job cost code; and (7) keeping supporting backup for all expenses organized by expense.

Unfortunately, delays on construction projects are commonplace.  If it has not happened yet, it is only a matter of time until a steel fabricator will incur substantial damages due to delay or be accused of delays alleging millions of dollars in damages.  Understanding delay claims and proactively monitoring the project schedule, as well as enlisting legal counsel and delay experts early in the process will assist in development of proof to prove or defend delay claims.


[1] See Colorado Environments, Inc. v. Valley Grading Corp., 779 P.2d 80, 84 (Nev. 1989) (citing Zook Bros. Constr. Co. v. State, 556 P.2d 911 (Mont. 1976)).

[2] See Dynalectric Co. of Nevada, Inc. v. Clark & Sullivan Constructors, Inc., 255 P.3d 286, 289 (Nev. 2011).

[3] See Plato General Const. Corp./EMCO Tech Const. Corp. v. Dormitory Authority of State, 89 A.D.3d 819, 825 (N.Y. App. Div. 2011).

[4] See Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O’Connor on Construction Law, § 15:29 (Thomson Reuters, 2018) [hereinafter Bruner & O’Connor].

[5] See Haney v. U. S., 230 Ct. Cl. 148, 168 (1982) (“[S]ome items of work are given no leeway and must be performed on schedule; otherwise the entire project will be delayed. These latter items of work are on the “critical path.” A delay or acceleration of work along the critical path will affect the entire project.”); Appeal of Southwest Marine, Inc., A.S.B.C.A. No. 36854, 95-1 B.C.A. (CCH) ¶ 27601, 1995 WL 139424 (Armed Serv. B.C.A. 1995) (“The critical path is crucial to the calculation of delay damages because only work on the critical path has an impact upon the time [in] which the project was completed; the Government delay must have interfered with the project’s critical path.”); see also Safeco Ins. Co. Of America v. Cty. Of San Bernardino, 347 Fed. Appx. 315, 318 (9th Cir. 2009) (citing treatise and opining that because the owner “has not shown that any of the insignificant delays [the contractor] caused were on the project’s critical path . . . whatever delays [the contractor’s] improper actions caused do not impact the amount of delay damages”); see also Cty. of Galveston v. Triple B Services, LLP, 498 S.W.3d 176 (Tex. App. 2016) (citing treatise regarding the distinction between “delay” damages and “disruption” damages, and concluding that both types of damages fell within the statutory waiver of sovereign immunity and thus were recoverable).

[6] See Robert M. D’Onofrio et al., ASCE Standard 67-17, Schedule Delay Analysis, 4.7 [hereinafter Schedule Delay Analysis].

[7] Kiewit Power Constructors Co. v. City of Los Angeles by and through Dep’t of Water and Power, No. CV 16-02590-AB, 2018 WL 5880919, at *7 (C.D. Cal. Mar. 22, 2018).

[8] JMR Constr. Corp. v. Envtl. Assessment & Remediation Mgmt., Inc., 198 Cal. Rptr. 3d 47, 60 (2015) (citing William F. Klingensmith, Inc. v. U.S., 731 F.2d 805, 809 (Fed. Cir. 1984) (“contractor generally denied recovery for government-caused delays where there are concurrent delays and absent ‘proof a clear apportionment of the delay and expense attributable to each’.”).

[9] See Schedule Delay Analysis, supra note 6, at 4.5.

[10] Morganti Nat., Inc. v. U.S., 49 Fed. Cl. 110, 132 (2001); see, e.g., R.P. Wallace Inc. v. U.S., 63 Fed. Cl. 402 (2004).

[11] See, e.g., Appeal of Kirk Bros. Mechanical Contractors, Inc., A.S.B.C.A. No. 43738, 93-1 B.C.A. (CCH) ¶ 25325, 26188, 1992 WL 197581 (Armed Serv. B.C.A. 1992) (“Where the delay is caused solely by the Government, it is compensable; where the delay is caused solely by the [contractor], [the contractor] is responsible . . . Where the delay is prompted by inextricably intertwined concurrent Government and contractor causes, the delay is not compensable.”); Andrew D. Ness, Delay, Suspension of Work, and Acceleration, in Federal Government Construction Contracts 413, 424–27 (Bastianelli et al. eds., 2003).

[12] Nev. Rev., Causes of Non-Excusable Delays in Construction and Remedies, (May 2020), https://thenevadaview.com/non-excusable-delays-in-construction/.

[13] Id.

[14] See W. Stephen Dale & Robert M. D’Onofrio, Construction Schedule Delays § 1:4 (Thomson Reuters, 2018) [hereinafter Construction Schedule Delays].

[15] Appeal of Dawson Const. Co., Inc., V.A.B.C.A. No. 3306, V.A.B.C.A. No. 3307, V.A.B.C.A. No. 3308, V.A.B.C.A. No. 3309, V.A.B.C.A. No. 3310, 93-3 B.C.A. (CCH) ¶ 26177, 1993 WL 243270 (Veterans Admin. B.C.A. 1993), aff’d, 34 F.3d 1080 (Fed. Cir. 1994); Dawson Const. Co., Inc. v. Brown, 34 F.3d 1080 (Fed. Cir. 1994) (holding contractor bears the burden of proof and broad generalities of government delay are insufficient). See also Fire Security Systems, Inc. v. General Services Admin., G.S.B.C.A. No. 12120, G.S.B.C.A. No. 12163, G.S.B.C.A. No. 12175, G.S.B.C.A. No. 12349, G.S.B.C.A. No. 12351, G.S.B.C.A. No. 12403, G.S.B.C.A. No. 12406, 97-2 B.C.A. (CCH) ¶ 28994, 1997 WL 251389 (Gen. Services Admin. B.C.A. 1997), on reconsideration, G.S.B.C.A. No. 12403-R, 97-2 B.C.A. (CCH) ¶ 29186, 1997 WL 473205 (Gen. Services Admin. B.C.A. 1997) (contractor’s base allegation that liquidated damage rate imposed by government was unreasonable did not shift the burden to the government to prove its reasonableness). See also Patrick M. Kelly & William E. Franczek, Clearing the Smoke: Forensic Scheduled Analysis Method Selection for Construction Attorneys, 33 Construction L. 30 (2013).

[16] Morrison Knudsen Corp. v. Firem’s Fund Ins. Co., 175 F.3d 1221 (10th Cir. 1999) (discussing burden of proof in the context to a challenge in jury instructions and finding harmless error as contractor bore the burden of not simply showing excusable delay so as to avoid a default termination, but also that such delay delayed the overall completion of the job, i.e., was to the critical path).

[17] See Construction Schedule Delays, supra note 14, at § 19:1.

[18] Construction Schedule Delays, supra note 14, at § 19:1.

[19] Rubin, The Total Cost Method of Computing an Equitable Adjustment – An Analysis, 26 Fed. B.J. 303 (1966) (stating the total cost method is “generally disfavored.”); see Amelco Electric v. City of Thousand Oaks, 38 P.3d 1120, 1130 (Cal. Ct. App. 2002) (citing Servidone Constr. Corp. v. U.S., 931 F.2d 860, 861 (1991) (“A trial court must use the total cost method with caution and as a last resort.”)); Ames Constr., Inc. v. Clark Cty., No. 2:18-cv-00299-JCM-EJY, 2020 WL 3488736, at *3 (D. Nev. Apr. 6, 2020) (citing Elte, Inc. v. S.S. Mullen, Inc., 469 F.2d 1127, 1131 (9th Cir. 1972); Raytheon Co. v. White, 305 F.3d 1354, 1365 (Fed. Cir. 2002)); Youngdale & Sons Const. Co., Inc. v. U.S., 27 Fed. Cl. 516, 541 (1993) (“Use of [the total cost] method is highly disfavored by the courts, because it blandly assumes…that every penny of the plaintiff’s costs are prima facie reasonable, that the bid was accurately and reasonably comp[uted], and that the plaintiff is not responsible for any increases in cost.”) (emphasis added).

[20] New Pueblo Constructors, Inc. v. State, 696 P.2d 185, 203 (Ariz. 1985); AMEC Civil, LLC v. DMJM Harris, Inc., No. 06–64 (FLW), 2009 WL 1883985, at *7 (D.N.J. June 30, 2009) (citing North Star Alaska Hous. Corp. v. United States, 76 Fed. Cl. 158, 213 (2007) (“The United States Court of Appeals for the Federal Circuit and the Court of Federal Claims have emphasized that ‘the preferred way for a contractor to prove increased costs is to submit actual cost data because such data provides the court, or contracting officer, with documented underlying expenses, ensuring that the final amount of the equitable adjustment will be just that–equitable–and not a windfall for either the government or the contractor.”)); but see Kansas Gas & Elec. Co. v. United States, 685 F.3d 1361 (Fed. Cir. 2012) (allowing total-cost allocation method when contractor “used an internal accounting system which coded costs to specific projects, the allocation rates were re-examined on a regular basis in order to reflect actual capital project costs, and the total-cost allocation method complied with required FERC accounting regulations.”).

[21] Boyajian v. United States, 423 F.2d 1231 (Ct. Cl. 1970).

[22] See Ames Constr., 2020 WL 3488736 at *4 (The way for a claimant to demonstrate this is by using a four-part test “to offset the methodology’s deficiencies.”). See Insulation Contracting & Supply, Inc., 131 Nev. 1302 (2015).

[23] Raytheon Co., 305 F.3d at 1365.

[24] See Propellex Corp. v. Brownlee, 342 F.3d 1335, 1339 (Fed. Cir. 2003); Boyajian, 423 F.2d at 1240.

[25] Colorado Environments, Inc. v. Valley Grading Corp., 779 P.2d 80, 84 (Nev. 1989) (citing L.L. Hall Constr. Co. v. United States, 177 Ct. Cl. 870 (1966)).

[26] See id. (citing Restatement (Second) of Contracts § 347(b)).

[27] Id.

[28] Id.

[29] Yacht West, Ltd. v. Christensen Shipyards, Ltd., 464 Fed. Appx. 626, 629 (9th Cir. 2011) (citing Golf Landscaping, Inc. v. Century Constr. Co., a Div. of Orvco, Inc., 39 696 P.2d 590 (Wash. Ct. App. 1984)).

[30] Wunderlich Contracting Co. v. United States, 173 Ct. Cl. 180, 198 (1965).

[31] Construction Schedule Delays, supra note 14, at § 18:2.

[32] See, e.g., Appeal of George A. Fuller Company, E.N.G.B.C.A. No. 1957, 1962 WL 225 (Corps Eng’rs B.C.A. 1962) (“The speed-up of the work was accomplished by adding workmen to the force and by increasing the hours of work per day and the days of work per week. When men work longer daily hours and weekends, much beyond the normal, their efficiency is impaired resulting in less production for a given number of man hours of work.”). See also Angelo Iafrate Constr. Co. v. Commw. of Pa., No. 3654, 2006 WL 2585021, at *23 (Pa. Bd. Claims June 13, 2006) (“Iafrate’s work productivity was adversely affected by Iafrate’s agreement to accelerate the completion of Phase II which caused the stacking of activities, working areas being over-crowded because multiple tasks were being performed out of sequence and because there was present extra workers and equipment, and the inability to move equipment, manpower and materials efficiently within the work zone.”); Tony Depaul & Son, No. 1452, 1993 WL 764322, at *18 (Pa. Bd. Cl. Oct. 28, 1993) (“Acceleration of work, including out of sequence work, start and stop operations, stacking of trades, simultaneous operations, additional manpower and equipment and additional work, causes a loss of efficiency and productivity in a contractor’s work efforts. Working in winter weather conditions, including rain, cold and freezing conditions, also causes a loss of efficiency and productivity in work efforts.”).

[33] See, e.g., Appeal of DANAC, Inc., A.S.B.C.A. No. 33394, 97-2 B.C.A. (CCH) ¶ 29184, 1997 WL 484579 (Armed Serv. B.C.A. 1997), on reconsideration, A.S.B.C.A. No. 33394, 98-1 B.C.A. (CCH) ¶ 29454, 1997 WL 763050 (Armed Serv. B.C.A. 1997), dismissed, 168 F.3d 1318 (Fed. Cir. 1998) (“We have long recognized that lost efficiency caused by a disruption of a contractor’s planned sequence of work may be compensable.”). See also Southern Comfort Builders, Inc. v. U.S., 67 Fed. Cl. 124, 145 (2005) (stating out of sequence work allegedly caused by waiting for RFI’s caused loss of productivity but was contractor’s responsibility for failure to prepare coordination drawings); Appeal of Parsons of California, A.S.B.C.A. No. 20867, 82-1 B.C.A. (CCH) ¶ 15659, 77418, 1982 WL 7041 (Armed Serv. B.C.A. 1982) (out of sequence of work in construction contract caused by drawing defects); Central Ceilings, Inc. v. Suffolk Const. Co., Inc., 2013 WL 8721044 (Mass. Super. Ct. 2013), aff’d 91 Mass. App. Ct. 231 (2017) (where prime required a sub “to constantly de-mobilize, re-mobilize, and alter the natural sequence of its work under the Subcontract” found loss of productivity). But see Electrical Contractors, Inc. v. Pike Co., Inc., No. 3:11–cv–01449, 2015 WL 3453348, at *20 (D. Conn. May 29, 2015) (agreeing that “just because work moves to a different area, a different time frame, doesn’t mean that it’s going to be less productive, [that] the contract was going to be automatically incurring loss of productivity. It means you’re doing it at a different time frame.”).

[34] See, e.g., Central Ceilings, Inc., 75 N.E.3d 40.

[35] See, e.g., Tony Depaul & Son, 1993 WL 764322 at *18 (“Acceleration of work, including out of sequence work, start and stop operations, stacking of trades, simultaneous operations, additional manpower and equipment and additional work, causes a loss of efficiency and productivity in a contractor’s work efforts. Working in winter weather conditions, including rain, cold and freezing conditions, also causes a loss of efficiency and productivity in work efforts.”).

[36] Construction Schedule Delays, supra note 14, at § 18:3.

[37] Bell BCI Co. v. U.S., 72 Fed. Cl. 164, 168 (2006).

[38] Sauer Inc. v. Danzig, 224 F.3d 1340, 1348 (Fed. Cir. 2000).

[39] Aetna Cas. & Surety Co. v. George Hyman Const. Co., 155 F.R.D. 113, 115 (1994) (citing various adjudications as to loss of productivity claims).

[40]  Id. (citing Southwest Marine, Inc., DOTBCA No. 1663, 94-3 B.C.A. (CCH) P27, 102 (1994)).

[41] Id. (citing Dawson Constr. Co., VABCA No. 3306-3310, 93-3 B.C.A. (CCH) 026, 177, aff’d 34 F.3d 1080  (Fed. Cir. 1994)).

[42] Luria Bros. & Co., Inc. v. U.S., 177 Ct. Cl. 676, 696 (1966) (emphasis added).

[43] See, e.g., U.S. ex rel. Salinas Constr., Inc. v. W. Sur. Co., No. C14-1963JLR, 2016 WL 3632487 (W.D. Wash. July 7, 2016) (vacating a jury verdict award because damages for inefficiency require expert testimony not lay testimony under Federal Rules of Evidence 701 and 702); Norment Sec. Group, Inc. v. Ohio Dept. of Rehabilitation and Correction, 2003-Ohio-6572, 2003 WL 22890088 (Ohio Ct. Cl. Dec. 2, 2003) (holding expert testimony not provided and inefficiency claim failed for lack of proof); Appeal of Dawson Const. Co., Inc., V.A.B.C.A. No. 3306, V.A.B.C.A. No. 3307, V.A.B.C.A. No. 3308, V.A.B.C.A. No. 3309, V.A.B.C.A. No. 3310, 93-3 B.C.A. (CCH) ¶ 26177, 1993 WL 243270 (Veterans Admin. B.C.A. 1993), aff’d, 34 F.3d 1080 (Fed. Cir. 1994) (ruling project manager’s testimony of inefficiency percentage insufficient to prove inefficiency); Havens Steel Co. v. Randolph Engineering Co., 613 F. Supp. 514, 540 (W.D. Mo. 1985), (finding that the court did not accept witness as a loss of productivity expert for lack of training or expertise); Appeal of Preston–Brady Co., Inc., V.A.B.C.A. No. 1892, V.A.B.C.A. No. 1991, V.A.B.C.A. No. 2555, 87-1 B.C.A. (CCH) ¶ 19649, at 99,520, 1987 WL 41248 (Veterans Admin. B.C.A. 1987), clarified on denial of reconsideration, V.A.B.C.A. No. 1892, V.A.B.C.A. No. 1991, V.A.B.C.A. No. 2555, 87-2 B.C.A. (CCH) ¶ 19925, 1987 WL 46592 (Veterans Admin. B.C.A. 1987) (“A general statement that disruption or impact occurred, absent any showing through use of updated CPM schedules, logs or credible and specific data or testimony, will not suffice to meet that burden.”).

Understanding Acceleration – The Basics

Although acceleration claims may arise in connection with project delays and many of the impacts are the same as those with delay claims, it is important for the steel fabricator to understand the basics of acceleration in order to preserve rights to costs associated with acceleration and to ensure that acceleration claims are preserved.

While the discussion below addresses the legal concepts involving acceleration, the importance of compliance with contractual acceleration and notice provisions cannot be ignored.  To be sure that claims for impacts due to acceleration are not waived, the steel fabricator must first comply with the contract.

Overview of Acceleration Claims

Acceleration typically refers to an effort to increase the pace of work to meet a project milestone, to overcome delay, to comply with an owner’s request, or some other justification for progressing the work faster.[1]  Acceleration is generally segregated into three categories:

  1. Voluntary acceleration
  2. Directed acceleration
  3. Constructive acceleration

Acceleration differs from delay. In the case of acceleration, a contractor “speeds up his work so that he is performing the job at a faster rate than prescribed in the original contract.”[2]  With delay, “there is a slowdown in work” and may be caused “by either party to the contract.”[3]  Acceleration is also different from disruption, though disruption is a normal consequence of acceleration.[4]  

A. Elements

For an acceleration effort to be compensable, the owner must, either directly or implicitly, order a contractor to speed up its efforts on the site in an attempt to complete the work in a period shorter than allowed by the contract.[5]

B. Directed Acceleration

Directed acceleration occurs when a contractor or owner exercises the “changes” or “change order” provisions of the contract to instruct, or direct, the performing party to complete all the work earlier than the original contract date.  Additionally, the parties may also mutually agree to the acceleration, outside of utilizing the changes provisions.[6] [7]

So long as the contractor is directed by unilateral change order or agrees via informal demand to complete the work ahead of schedule—and does so without relinquishing its rights—the contractor may recover its extra costs incurred in carrying out the acceleration directive.[8]  However, an owner’s “demand that ‘the contract be completed on time’ [does] not constitute an order to accelerate.”[9]

To recover from a directed acceleration, the contractor seeking the adjustment “bears the burden of proving liability, causation, and resultant injury.[10]

Since directed acceleration normally adds obligations through the change order process, “it is almost uniformly compensable.”[11]  Courts will award damages upon a finding, based on sufficient evidence, that a “subcontractor sustained additional cost on account of accelerated performance of [the] subcontract required by prime contractor.”[12]  Directed acceleration is “seldom litigated.”[13]  When it is litigated, it is usually because of a problem with the “direction to accelerate.”[14]

The best practice when there is a directive to accelerate is to agree on costs upfront and have the directive acceleration memorialized in a change order.  However, if not memorialized via a change order, it is imperative that the steel fabricator preserve any claim for directed acceleration by following the notice and claim procedures in the contract and ensuring that the directed acceleration claim is not waived by any lien waivers or progress payments.

C. Constructive Acceleration

Constructive acceleration occurs when an owner/contractor has failed to recognize delays to the project and adjust the contract time accordingly, while at the same time demanding completion of the work by the unextended contract completion date.[15]  An affected party must prove the following in order to be entitled to recovery of increased costs due to constructive acceleration: [16] [17] [18]

(1) the contractor experienced an excusable delay entitling it to a time extension;

(2) the contractor properly requested the extension;

(3) the project owner failed or refused to grant the requested extension;

(4) the project owner demanded that the project be completed by the original completion date despite the excusable delay; and

(5) the contractor actually accelerated the work in order to complete the project by the original completion date and incurred added costs as a result.

It is crucial that the steel fabricator request the time extension in order to be able to pursue a constructive acceleration claim.  If a time extension is not requested and denied, a constructive acceleration claim will fail.  As with directed acceleration claims, care should be taken to follow the notice and claim procedures of the contract, as well as preserving the claim in relation to any progress payment or lien waiver.

In addition, the contractor must show and prove its damages stemming from the constructive acceleration.  Often, courts require acceleration damages to be supported by written requests, consistent with contractual requirements, for extensions of time and/or price.[19]  Further, all support for any necessary extra equipment rentals or man-hours must be provided and substantiated with supporting documentation and time sheets.  Failure to do so will greatly reduce or even eliminate the ability to recover on a properly preserved constructive acceleration claim.

D. Voluntary Acceleration

Voluntary acceleration arises when a party performs ahead of schedule for its own purposes or motives, not because of the directives of another party.[20] [21]  In this situation, the accelerating contractor generally does not have a claim for acceleration damages—because the additional costs were incurred to meet the contractor’s own goals and objectives, making it inequitable to hold another party liable for such costs.[22] [23]

Voluntary acceleration is often used as a project tool “and can be used to effectively manage the work.”[24] [25]  “Voluntary acceleration to advance personal interests or to overcome ‘inexcusable’ delay results in acceleration costs being non-compensable.”[26]  Indeed, “[a] contractor may accelerate on his own initiative to assure completion within the contract schedule or for other purposes.”[27]  However, the contractor cannot recover for acceleration unless it was ordered to accelerate.[28]

To prove voluntary acceleration, one must establish that a contractor accelerated on its own prerogative.[29]  Additionally, if a contractor falls behind “in meeting its own accelerated schedule and devotes additional resources to recover the lost time, the contractor typically remains responsible for the cost of those resources.”[30]

Courts generally recognize that a contractor is not entitled to recover damages arising from voluntary acceleration.[31]

E. Proving Acceleration Damages

As with delay claims, proving acceleration damages requires substantiation of labor and equipment costs.  Acceleration claims may involve a component of lost productivity, which will require expert testimony to support the damages using a reliable method such as a measured mile.  For further discussion regarding lost productivity claims and methods of proof, please refer to the following article:  What You Need to Know About Delay Claims and How to Prove or Defend Against Them.

Conclusion

Even though projects may involve both delay and acceleration, acceleration is a different concept requiring consideration be given to the type of acceleration at issue.  Close attention should be paid to contractual acceleration and change order requirements, as well as proper documentation of acceleration impacts.  If the steel fabricator is directed to accelerate, the steel fabricator should be entitled to compensation for the acceleration, and it is advisable to reach an agreement on the amount of compensation via the change order process to avoid a dispute later.  Where the steel fabricator is constructively accelerated, it is imperative to request a time extension as failure to do so will likely result in waiver of a claim for acceleration.  Finally, remember that voluntary acceleration is not considered compensable.  Acceleration claims can be waived if the notice and claim procedures of the contract are not followed, as well as if they are not reserved in connection with progress payments and lien waivers.

Finally, some practical tips to consider when accelerated are: (1) be mindful of deadlines set forth in the contract for requesting change orders associated with acceleration impacts; (2) request a time extension when constructively accelerated; (3) if directed to accelerate, reach an agreement up front that you have been directed to accelerate and that you will be paid for all labor, equipment, and materials; (4) track all labor, material, and equipment expenses with a separate job cost code; (5) keep supporting backup for all expenses organized by expense; and (6) retain a delay expert to consult regarding schedule issues.


[1] W. Stephen Dale & Robert M. D’Onofrio, Construction Schedule Delays 150 (Thomson Reuters, 2018) [hereinafter Construction Schedule Delays].

[2] Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O’Connor on Construction Law, § 15:90 (Thomson Reuters, 2018) [hereinafter Bruner & O’Connor].

[3] Id.

[4] See id.; see generally Natkin & Co. v. George A. Fuller Co., 347 F.Supp. 17 (W.D. Mo. 1972).

[5] See generally John Cibinic, Jr., Ralph C. Nash, Jr. & James F. Nagle, Administration of Government Contracts 445–58 (Wolters Kluwer, 4th ed. 2006) [hereinafter Administration of Government Contracts); see also Norair Engineering Corp. v. U.S., 229 Ct. Cl. 160 (1981); Fru-Con Corp. v. State, 50 Ill. Ct. Cl. 50, 93 (1996) (“Acceleration occurs when a contractor is forced to perform the work in a shorter period of time than is called for in the contract. Acceleration can take different forms. A constructive acceleration occurs when the government denies or unreasonably delays in granting the contractor a time extension which is justified, and at the same time holds the contractor to the original completion date.”); Contracting & Material Co. v. City of Chicago, 314 N.E.2d 598, 604 (Ill. App. Ct. 1974), rev’d, 349 N.E.2d 389 (Ill. 1976) (stating that a contractor must prove that it has encountered an excusable delay for which it is entitled to a time extension; it specifically requested an extension of time; the government failed or refused to grant the extension; the government caused the contractor to complete the work within the un-extended contract period, and it actually accelerated the performance.).

[6] S. Leo Harmonay, Inc. v. Binks Mfg. Co., 597 F. Supp. 1014, 1021 (S.D.N.Y. 1984) (“[The subcontractor] was asked to increase its crew sizes, put on a second shift, and work both crews overtime. In addition, the crews were required to sometimes work on weekends and holidays throughout the acceleration period.”); see also Northway Decking & Sheet Metal Corp. v. Inland-Ryerson Constr. Products Co., 426 F. Supp. 417 (D.R.I. 1977); General Insurance Co. v. Commerce Hyatt House, 85 Cal. Rptr. 317 (1970).

[7] See Bruner & O’Connor, supra note 2, at § 15:92; Conti Corp. v. Ohio Dept. of Admin. Servs., No. 88-14568, 1992 WL 12009509, at *13 (Ohio Ct. Cl. 1992) (“Directed acceleration occurs whenever the owner directs the contractor to finish the project in advance of the time for completion.”).

[8] Bruner & O’Connor, supra note 2, at § 15:92; see Bat Masonry Co., Inc. v. Pike-Paschen Joint Venture III, 842 F. Supp. 174, 182 (D. Md. 1993) (finding that a contractor’s informal letter directing its subcontractor “to increase your manpower and equipment to facilitate working in [certain] areas” constituted the contractor’s “request of [its subcontractor] to accelerate the work and an agreement to negotiate in good faith the payment of any additional costs incurred by [the subcontractor] as a result of that acceleration”).

[9] Construction Schedule Delays, supra note 1, at § 3:14.

[10] See, e.g., CEMS, Inc. v. U.S., 59 Fed. Cl. 168, 189 (2003); Ralph L. Jones Co., Inc. v. U.S., 33 Fed. Cl. 327, 331 (1995); Servidone Constr. Corp. v. U.S., 931 F.2d 860, 861 (1991) (“To receive an equitable adjustment from the Government, a contractor must show three necessary elements—liability, causation, and resultant injury.”); Wunderlich Contracting Co. v. U. S., 173 Ct. Cl. 180 (1965) (“leniency as to the actual mechanics of computation does not relieve the contractor of his essential burden of establishing the fundamental facts of liability, causation, and resultant injury.”).

[11] Faegre Drinker, Fast and (Sometimes) Furious: Acceleration and Compensability in Construction Contracts, (Sept. 07, 2017), https://www.faegredrinker.com/en/insights/publications/2017/9/fast-and-sometimes-furious-acceleration-and-compensability-in-construction-contracts.

[12] See Baker & Ford Co. v. U.S. for Use & Benefit of Urban Plumbing & Heating Co., 363 F.2d 605 (9th Cir. 1966).

[13] See Barry B. Bramble & Michael T. Callahan, Construction Delay Claims, § 6.02 (Wolters Kluwer 5th 2013).

[14] Id.; see also K.P. Meiring Constr. v. La Quinta Inns, No. 04-02-00425-CV, 2003 Tex. App. LEXIS 1048 (Tex. App. Feb. 5, 2003).

[15] See Bruner & O’Connor, supra note 2, at § 15:94.

[16] Murdock & Sons Constr., Inc. v. Goheen Gen. Constr., Inc., 461 F.3d 837, 840 (7th Cir. 2006)

[17] See also Fraser Constr. Co. v. United States, 384 F.3d 1354, 1360–61 (Fed. Cir. 2004). Cf. Norair Engineering Corp. v. U.S., 229 Ct. Cl. 160 (1981) (three elements); Appeal of McNutt Const. Co., Inc., E.N.G.B.C.A. No. 4724, 85-3 B.C.A. (CCH) ¶ 18397, 1985 WL 17278 (Corps Eng’rs B.C.A. 1985). See generally Administration of Government Contracts, supra note 5, at 445–56 (2006); see also Sherman R. Smoot Co. v. Ohio Dept. of Adm. Serv., 736 N.E.2d 69, 78 (Ohio Ct. App. 2000) (“Constructive acceleration occurs when a contractor has a justified claim for an extension of time, but is required to incur additional expenses because the project owner refuses to grant the extension and requires the contractor to complete the project by the original completion date.”).

[18] Bruner & O’Connor, supra note 2, at § 15:94.

[19] See Azure v. U.S., 129 F.3d 136 (Fed. Cir. 2016).

[20] See Bruner & O’Connor, supra note 2, at § 15:89

[21] See also Siefford v. Hous. Auth. of City of Humboldt, 223 N.W.2d 816 (Neb. 1974); Mobil Chem. Co. v. Blount Bros. Corp., 809 F.2d 1175 (5th Cir. 1987).

[22] See, e.g., Robert F. Cushman et. al., Proving and Pricing Construction Claims § 4.03 (3d ed., 2020) [hereinafter Proving and Pricing Construction Claims].

[23] See also Iconco v. U.S., 224 Ct. Cl. 692 (1980); O’Hair Constr. Co., AGBCA No. 82-115-1, 89-1 B.C.A. (CCH) ¶ 21,384 (1989).

[24] Construction Schedule Delays, supra note 1, at §3:8

[25] Bruner & O’Connor, supra note 2, at §15:101.

[26] Id.

[27] O’Hair & O’Hair Construction Co., AGBCA 82-115-1 (1988).

[28] Id.

[29] Dep’t of Transp. v. Anjo Constr. Co., 666 A.2d 753, 758 (Pa. 1995).

[30] Proving and Pricing Construction Claims, supra note 22; O’Hair Constr. Co., ¶ 21,384 (1989).

[31] See Envirotech Corp. v. Tennessee Valley Auth., 715 F. Supp. 190, 192 (W.D. Ky. 1988) (holding contractor who worked at maximum pace to earn a bonus was not entitled to damages because the Owner did not order the contractor to accelerate); Nello L. Teer Co. v. Washington Metro. Area Transit Auth., 695 F. Supp. 583, 592 (D. D.C. 1988) (ruling acceleration damages were not compensable where record did not support a finding the Owner ordered the contractor to accelerate); Allen L. Bender, Inc., PSBCA No. 2324 (1991) (finding no recovery where there was no directive from the government to accelerate); O’Hair & O’Hair Construction Co., AGBCA 82-115-1 (1988) (“We find the subcontractor’s decision to change his method of performance, so as to complete the project in one season despite acknowledged overruns, to be a business judgment.”); Iconco v. U.S., 224 Ct. Cl. 692 (1980) (holding contractor not entitled to recovery where there was no denial of a request for time extension); Solar Foam Insulation, ASBCA No. 46278 (1993) (holding no recovery where acceleration was not directed); McNutt Construction Co., Inc., ENGBCA 4724 (1985) (finding contractor with motives to complete the work aside from directives from the owner was not entitled to compensation); Mobil Chemical Co. v. Blount Bros. Corp., 809 F.2d 1175, 1179 (5th Cir. 1987) (ruling contractor stood to gain by accelerated completion of the project and holding contractor “was the perpetrator and not the victim of the acceleration.”).