Time is Money: The Cost of Accelerated Work
Although most construction contracts set clear milestone dates and completion dates, time tables often need to be shifted for the owner’s benefit. In most cases, the owner needs construction to wrap up sooner than expected to facilitate their ability to capitalize on their investment, which can increase costs for the contractor. Conversely, the contractor may choose to voluntarily expedite construction for their own purposes, but this wouldn’t have an effect on the owner unless it compromised the quality of construction.
If an owner has requested that you accelerate your rate of work beyond the terms established in the contract, consult a Tallahassee construction lawyer to plot your best course of action for handling this request. Accelerating your project schedule may very well be within your capabilities, but the owner will be responsible for supplying the necessary funds to guarantee that you aren’t taking a financial hit for complying with their request. There are a number of things that may have to be done to facilitate such a request, such as renegotiating the original terms of the contract.
In this editorial, the Tallahassee construction lawyers at Cotney Attorneys & Consultants will discuss the cost of accelerated work and detail everything a contractor should do if an owner requests that they expedite the project timeline. Maintaining your relationship with the owner, profitability, and build quality requires a fine balancing act, but it’s possible when you let an expert handle the legal legwork of such a request.
Timing is Everything
Time is one of the most important considerations for every construction project. No contractor is going to take on a project without a clear idea of how long it will take, and no contract is going to be signed without this information clearly spelled out for both parties. In order for contractors to plan their production schedules accurately, the owner needs to set a deadline and agree to milestones. The contractor will then assemble a team, contact material suppliers, and initiate the building process. When an owner requests that one or all parts of a project be expedited, it essentially throws a wrench in the contractor’s original plan, which leads to increased costs and other issues.
This is less problematic when the contractor decides to expedite construction on their own. Some of the reasons a contractor may choose to do this include:
- To close out early so they can move on to a more lucrative project
- To eliminate delays and inefficiencies
- To save money
- To procure early completion bonuses
There’s little chance that a contractor can use these voluntary reasons as the basis for an acceleration claim, but if the request for acceleration comes from the owner, a Tallahassee construction lawyer can help you file a claim for additional funding.
Common Cases for Acceleration Claims
Although an owner may request that a project be expedited for a number of reasons, most acceleration claims result from project delays. The owner may request that the contractor expedite construction to recover missed time. However, when project delays can be attributed to forces outside of the contractor’s control, it’s generally not the contractors duty to accelerate the building process to play “catch-up.”
Work can be accelerated in a number of ways, including:
- Assigning overtime
- Adding a new shift
- Securing additional labor
- Implementing new resources
- Altering the sequence of work-related activities
However, these adjustments aren’t free, and contractors shouldn’t be expected to pay out of pocket for their implementation. Acquiring new resources could cost tens of thousands of dollars or more. Working overtime will require the contractor to pay workers at one and one-half of their hourly rate, which causes the cost of construction to spike during overtime. And even if these actions are taken, accelerating work doesn’t guarantee that a contractor will meet the deadline originally proposed in the contract.
When the owner directs the contractor to expedite construction in order to meet a deadline that was not specified in the contract, it is referred to as “directed acceleration.” When an owner makes this type of request, it often leads to a dispute. Fortunately, the law is generally on the contractor’s side. Before mistakenly taking any ill-advised actions, contractors should consult a Tallahassee construction mediation attorney to see if they can resolve the dispute without litigation. In many cases, the owner is fixated so heavily on maintaining profitability that their demands become unreasonable. A Tallahassee construction dispute attorney can help placate them and inform them about their legal obligations according to the contract. By partnering with an attorney before you sign a contract, you can ensure that you aren’t unintentionally waiving your rights.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.