Dealing with delays & design errors

Liquidation agreements can help subcontractors pursue claims against owners


Suppose you are working on a large new manufacturing plant. Your estimator studied the architectural drawings to prepare your company's bid. Your estimator is experienced and, having learned an expensive lesson from another job years earlier, made sure to check the mechanical drawings for rooftop penetrations. He took what he could decipher from the mechanical drawings into account when determining the number of penetrations and flashings and their effects on the roof system installation. Your company was the lowest bidder and was awarded the job.

You signed the general contractor's standard subcontract agreement that included a no-damage-for-delay clause, which stated the subcontractor was not entitled to make a claim for additional compensation for delays. Per the subcontract, your remedy in the event you were delayed was limited to a time extension to perform your work.

Once the job was underway, it became apparent there were many more penetrations and more equipment was being installed on and through the roof than were shown on the architectural or mechanical drawings. Your work was affected significantly, making the job far more expensive and requiring more time than estimated.

The general contractor was willing to consider your proposed change order for the direct costs of flashing additional penetrations that were not shown on architectural, mechanical or electrical drawings but nothing else. Citing the no-damage-for-delay provision in the subcontract, the general contractor was unwilling to consider your claim for the additional costs you incurred.