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Payment Issues For Construction Projects

South Florida Construction Lawyer

All participants involved in a construction project have a lawfully protected interest in the timely completion of a project that is determined by performance and payment. Delays in performance are one of the most frequently litigated issues that occur during construction projects. If you are in South Florida and are experiencing these issues, you will need a qualified South Florida construction lawyer to handle you case.

Construction projects require enormous overhead, costly equipment, a substantial workforce, and massive payrolls for both contractors and owners. The longer a job takes to complete, the higher the costs and the greater the potential for litigation as a resolution. Because of the high costs of untimely construction performances, contractors and owners usually require meticulously planned, often complex schedules to avoid performance and payment issues.

Delays That Can Impede a Construction Project

Any kind of delay that prevents a construction project from being completed on time and within the contracted budget, can have considerable financial repercussions for the project owner and the contractor. If it happens, it’s possible for the involved parties to clear up the problem that caused the delay, on their own. However, it is a frequent occurrence that disputes are insolvable, and given to the arbitrators or the courts, to decide which party is responsible for the delay and the financial compensation that should be paid.

Two General Types of Delays

The two types of delays that can affect the timely completion of a project are the inexcusable and excusable delays.

  • Inexcusable delays are the fault of the contractor or third parties such as subcontractors or material suppliers for whom the contractor may be responsible under the contract.
  • Excusable delays, are those that occur because of circumstances that are unavoidable or out of the control of the contractor. These are delays that are not the fault of the contractor or third parties for whom the contractor is responsible. Depending on the type of delay, the owner will recover different types of damages.

Compensable Delays

Compensable delays are the kind that was not foreseen when the contract was drawn up and are caused by an inaction or action on the part of the owner or the owner’s subordinates.

Concurrent Delays

Two or more delays that have independently resulted during the same time period, which have a significant effect on the project‘s completion date. Depending on the type of delay, the affected party or parties can receive compensation to offset the extra costs or damages incurred by the delays.

Liquidated Damages

Compensation designated during the writing of a contract so the affected party can collect for a specific breach, such as unpunctual performance. When compensation isn’t predetermined in the contract, then the compensation amount and who receives it will be determined by a court in the event of breach.

Contractor’s Damages When Early Completion is Delayed

Frequently, contractors aim to complete their work on a project earlier than indicated in the contract. Contractors who calculate their overhead amount according to a planned early completion schedule when making their bid, can be damaged if the planned-for early completion becomes delayed.

Defenses Against Delay Damages

Exculpatory Clauses

Exculpatory clauses provide no damages for delays in construction contracts between owners and general contractors. These clauses release a party from liability if damages result during construction projects because of delays that often happen and are unavoidable. Contractors and subcontractors can also include these clauses in contracts to protect themselves against liability.

Written Notice Requirements

Construction contracts can specify any claim for time extensions, additional costs, or delay damages be submitted and confirmed by written notice. It is necessary for written notice to be presented within a certain period of time, after the event has occurred that caused the delay, because failure in doing so may prevent the injured party from recovering delay damages.

Waiver

A contractor can sign a waiver, relinquishing their right to recover delay damages from an owner for agreed upon reasons. A project owner may waive the right to seek damages after they make their last payment to the contractor.

Acceleration Damages

Acceleration damages are the extra expenses incurred by the contractor when the owner requires them to complete the project, or part of it, in less time than provided in the contract documents.

The law firm of Jonathan P. Cohen, P.A. practices construction law, as well as, surety bond law and commercial law in the state of Florida. Our attorneys deal with all phases of commercial contracting and construction defect disputes in state and federal court. We also assist our clients when payment issues arise due to delays that could happen when working on a construction project. Delays cost money, and they put all those who are involved in the project at risk. When litigation becomes necessary to resolve the payment disputes, we are there to give our clients our full legal support.

South Florida Construction Lawyer

Managing partner, Jonathan P. Cohen, Esq., is a South Florida Construction Lawyer who expertly protects our client’s rights while dealing with complicated surety, commercial, and construction issues. Contact the Law Firm of Jonathan P. Cohen, P.A. for a consultation with a South Florida Construction Lawyer. Our attorneys are dedicated to standing with our clients as their cases progress, advising them of their legal options, and representing them to the best of our abilities. To schedule a consultation, call (954) 462-8850, or email us at info@jcohenpa.com. Contact us  and we will respond as soon as possible.