A 1970 Creedence song could have easily been about the 2019 construction season in the Upper Midwest. It opens with the lyrics:
As long as I remember
The rain's been comin' down
Clouds of mystery pourin'
Confusion on the ground
This verse aptly describes this year’s onslaught of adverse weather. Nobody can know how many good working days they will have to complete a project. At the same time, nobody can plan a season of work based upon unprecedented conditions that defy expectations.
Recent headlines tell a now-familiar story:
- “It’s a record: Iowa has wettest 12-month period since official records began in 1895”
- “Iowa DNR: Last 18 months the wettest on record”
- “Minnesota is having the wettest year on record”
- “2019 one of the wettest on record with two months left” (North Dakota)
- “The three-month period of August, September and October was the wettest on record in 125 years” in North Dakota
- “2019 Wettest Year on Record for South Dakota”
- “South Dakota endures historic precipitation in 2019”
- “Based on 125 years of South Dakota weather data, 2019 is the wettest on record”
None of this is news to contractors, engineers, or owners. On projects across Iowa, Minnesota, North Dakota, and South Dakota, Mother Nature squeezed more working days out of schedules than the industry is built to absorb. This happened across the region, spanning the season, with little relief available because everyone was in the same boat.
With winter weather now bearing upon us and the full impact of 2019 coming into focus, industry professionals have to ask: Who should bear the brunt of this bad luck?
Adverse Weather, By the Spec Book
As a starting point, specifications in low-bid construction typically establish a baseline budget and schedule, subject to change. Time extension and change order clauses may be triggered by specific events, but may also cover a broad category of events that are beyond anybody’s control. A season of unprecedented adverse weather certainly fits that description.
Not surprisingly, specifications written to benefit one side are not always very forgiving to the other side when it comes to weather, but they are also often open to interpretation. Specifications may simply be silent about weather. They may alternatively say something vague, such as that “normal” weather should be expected. Often, contract documents only focus on what will not justify a revision to the contract, leaving parties wondering what will justify a revision.
For example, a “no damage for delay” clause may list weather as an event that allows a time extension, but not payment for increased costs. Applying this to real world situations can get complicated. Taking more time to complete the same work always increases costs. But other unanticipated developments, like changed site conditions, can also be impacted by weather and increase costs at the same time. The entire contract must be read in harmony, which can lead to conflicting conclusions.
A widespread situation (like a relentless season of bad weather) causes widespread impacts, with consequences that don’t always fit neatly into a single bucket.
If notice provisions and change order clauses don’t provide a clear allocation of risk with respect to an extreme weather situation, legal rights may not be immediately evident, particularly those legal rights that exist outside the specifications. “Impossibility,” for example, is a recognized legal excuse that calls into question whether liquidated damages are legal, or if they constitute an illegal penalty, when a contractor is unable to meet an impossible schedule.
Specifications, of course, are contract documents. In theory, contracts should reflect “the intent of the parties.” When something unexpected happens and specifications don’t clearly allocate the risk, different parties can have different ideas about what they “intended.” At that point, we may have to think outside the specifications to resolve our conflicts.
When a schedule goes awry for any reason, there are no easy answers. However, a few straightforward actions can generally help the situation:
- Give notice early, before milestone or completion dates when possible.
- Decide as soon as possible how to measure and track the impact.
- Specifically track and document the impact on controlling items of work.
- Identify and document efforts to overcome delays or mitigate the impact.
- Communicate regularly about the situation.
Even if contract requirements are unclear, giving prompt written notice of a potential delay—in advance of milestone and completion dates when possible—helps set expectations, reduce potential disagreements, and establish the importance of the issue.
In addition, diligent record-keeping and written communication during the project will make everyone’s job easier, including those who need to approve time extension requests. On the other hand, less-than-perfect documentation should not prevent parties from agreeing to handle unprecedented circumstances in a fair manner, consistent with reasonable expectations.
A little good faith and common sense can go a long way.
Service. Honesty. Reliability.
© 2019 Welle Law P.C. No unauthorized use or reproduction.
This blog is for informational purposes only and should not be interpreted as legal advice. You should contact your attorney regarding any particular issue or problem. Nothing on this website creates an attorney-client relationship between Welle Law P.C. (or any of its attorneys) and the reader.