CONTRACTOR’S BURDEN WHEN IT COMES TO DELAY

When a contractor is challenging the assessment of liquidated damages, or arguing that it is entitled to extended general conditions, the contractor bears a burden of proof to establish there were excusable delays that impacted the critical path and, in certain scenarios, the delays were not concurrent with contractor-caused delay:

When delays are excusable, a contractor is entitled to a time extension, such that the government may not assess liquidated damages for those delays.  The government bears the initial burden of proving that the contractor failed to meet the contract completion date, and that the period of time for which the government assessed liquidated damages was correct. If the government makes such a showing, the burden shifts to the contractor to show that its failure to timely complete the work was excusable. To show an excusable delay, a contractor must show that the delay resulted from “unforeseeable causes beyond the control and without the fault or negligence of the Contractor.”  “In addition, the unforeseeable cause must delay the overall contract completion; i.e., it must affect the critical path of performance.” Further, the contractor must show that there was no concurrent delay.

Ken Laster Co., ASBCA No. 61292, 2020 WL 5270322 (ASBCA 2020) (internal citations omitted).

Arguing delay without understanding your burden of proof obligations will be problematic, as the contractor in Ken Laster found out.  In this dispute, a contractor was issued task orders to repair, prepare and plaint certain floating structures pursuant to task orders.  The contractor was liable for liquidated damages if it did not timely complete the work.  The contractor completed the work 289 days late and the government assessed liquidated damages.  The contractor challenged the assessment of liquidated damages. However, the contractor did NOT show how anything it claimed the government did to delay completion impacted the critical path or that there was no concurrent delay.  Without such showing, the contractor was unable to establish that liquidated damages were improper as it was unable to show there was excusable delay or that the delay to the critical path it caused was concurrent with an owner-caused delay to the critical path.

Remember, if you are a contractor challenging the assessment of liquidated damages and/or claiming you are entitled to delay damages (extended general conditions), you have a burden of proof.  You will want to establish that there was excusable delay, i.e., owner-caused delay, that impacted the critical path of the project resulting in the delay to the completion date, and the excusable delay was not concurrent with delay you caused to the completion date.  This burden will routinely require expert opinion that will need to analyze schedules and contemporaneous project documentation to render these opinions (that there was excusable delay, the delay impacted the critical path, and in certain scenarios, the excusable delay was not concurrent).   It is important to note, however, that if you are able to establish there was concurrent delay, you would still typically be entitled to a time extension, however, you would not be entitled to compensation for the delay (extended general conditions).  But, the burden is still on you to establish there was concurrent delay.

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

 

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