“A schedule defends from chaos and whim. It is a net for catching days. It is a scaffolding on which a worker can stand and labor with both hands at sections of time.”
-Annie Dillard, winner of the Pulitzer Prize in nonfiction
“A schedule defends from chaos and whim. It is a net for catching days. It is a scaffolding on which a worker can stand and labor with both hands at sections of time.”
-Annie Dillard, winner of the Pulitzer Prize in nonfiction
The critical path method (CPM) scheduling was formally developed in the late 1950’s to address the challenges of better planning, scheduling and managing complex projects. It is the most-used scheduling technique in the construction industry and is also used extensively in aerospace, software development, product development and engineering.
By modeling activity durations, logical relationships and the end point (completion milestone) of the project, CPM scheduling allows one to determine which activities are “critical” to the completion of the project. With the term “critical activity” meaning those activities that must be performed on their earliest planned start and finish dates to avoid causing a delay to the overall end date of the project. By definition, the critical path of the project is the longest path through the network that establishes the minimum overall project duration. Thus, each time the schedule is updated the critical path can be be calculated to determine the anticipated project completion date. Knowing which activities are critical allows the project team to stay focused on progressing the work along the critical path. Knowing if the end date has slipped allows the project team to analyze the critical path and come up with a recovery plan to accelerate the work along the critical path. Critical path analysis is also used to perform delay analysis and to justify time-extension requests. Non-critical activities can be monitored to ensure they do not become critical and potentially delay the project.
For the classical schedule calculation, the critical path is the continuous chain of activities through the network schedule with zero total float. Total float is an important characteristic of CPM scheduling because it indicates the amount of time an activity can start from its planned start date without delaying the project. Total float and the critical path can be identified using the following parameters:
Every time you schedule a project using CPM scheduling software such as Oracle-Primavera, the scheduling algorithm performs a forward and backwards pass and calculates the total float for each activity. You cannot edit an activities float value directly. Primavera allows users to choose whether to calculate the critical path by total float or by the longest path. The difference between the longest path and total float is that the longest path calculation will always identify the activities that are truly critical and driving the end date of the project. Total float calculations can sometimes be affected by constraints and differences in project calendars that can yield total float values where the path(s) with zero or negative float may not be the true critical path of the project. Therefore, it is always recommended to schedule a project using the Longest Path and not Total Float when determining the critical path of the project.
Diligent monitoring of the critical path is key to keeping your team focused on timely project delivery and allow them to quickly address issues and delays as they occur. Disregarding the critical path can lead to costly delays and delay claims.
Florida Consultants is an Orlando, FL based consulting firm providing a variety of CPM planning, scheduling and forensic delay analysis services. For true expertise from a reliable, experienced source, trust Florida Consultants to help you with your CPM scheduling needs.
A recent Federal Circuit decision will likely have a major impact on future schedule delay claims and disputes. Metcalf Construction entered into a contract agreement with the Navy to build 212 duplex housing units in Hawaii. The contract included a standard differing site condition (DSC) clause with a independent duty provision for the contractor to perform its own pre-bid soil investigation. After award, Metcalf performed a soil investigation that found highly expansive soils which could have posed a significant risk of slab-on-grade failure if the duplexes were built in accordance with the Navy’s original design. The design had to be altered and Metcalf submitted two formal DSC claims to the government requesting additional compensation for direct costs and delay damages. The Contracting Officer denied the claims. Metcalf proceeded with the changed design and performed the work in accordance with the new geotechnical recommendations to properly deal with the expansive soils. Needless to say, the project and ran into significant cost overruns due to the DSC and schedule delays. The Navy paid Metcalf $49 million, but Metcalf’s actual costs exceeded $76 million.
DSC’s are typically characterized as one of two types: (1) the conditions encountered at the site differ materially from those indicated in the contract (Type I), or (2) the conditions encountered at the site differ materially from those normally encountered (Type II).
Type I Differing Site Conditions Claims
An owner may be required to provide an equitable adjustment for a Type I differing site condition if: (1) the contract indicated the conditions that the contractor could expect to find at the site; (2) the conditions indicated in the contract differed materially from the actual conditions; (3) the actual conditions were reasonably unforeseeable based upon all the information available to the contractor at the time of bidding; (4) the contractor acted as a reasonably prudent contractor in interpreting the contract documents; (5) the contractor reasonably relied on its interpretation of the contract and contract-related documents; and (6) the contractor incurred additional costs as a result of the difference between the expected conditions and the actual conditions.
In the original court case, the Court of Federal Claims found in favor of the government. It determined that the Metcalf case did not meet the threshold of a Type 1 differing site condition and that the DSC clause’s requirement for Metcalf to perform its own pre-bid soil investigation shifted all of the risk of the DSC to Metcalf. In early 2014, the U.S. Federal Circuit Court of Appeals reversed the original Court of Federal Claims decision citing that the DSC clause did not fully shift all risk to Metcalf.
The potential consequences of the Federal Court’s reversal could be significant. The Federal Circuit ruled that the Court of Claims had applied the wrong legal standard and misinterpreted certain provisions of the contract. The judges ruling is summarized as follows:
Even requirements for pre-bid inspection by the contractor have been interpreted cautiously regarding conditions that are hard to identify accurately before work begins, so that the duty to make an inspection of the site does not negate the changed conditions clause by putting the contractor at peril to discover hidden subsurface conditions or those beyond the limits of an inspection appropriate to the time available.
The Metcalf appeal should be seen as a major win for general contractor and will likely have a significant influence over contract documents and dispute resolution proceedings in the future.
This guest post is by construction attorney David Adelstein (photo). David is a Florida Board Certified Construction Attorney with the law firm of Kirwin Norris, P.A. He maintains the website Florida Construction Legal Updates where he blogs about various legal issues that pertain to the construction industry.
Enter David Adelstein:
Strong project management is critical to prime / general contractors in furtherance of ensuring the successful and profitable completion of a project. Among other things, strong project management involves understanding the scope of work activities that drive the timely completion of the project. Having a good plan at the beginning (that is peer reviewed) as detailed in a baseline schedule will enable project management to best coordinate and sequence trades knowing the total float for the project and the float identified for non-critical path trades. The baseline schedule is not written in stone. If it was, it would never need to be updated. But, construction involves unanticipated and unforeseen issues and risks that make it virtually impossible for the baseline schedule to be followed to the tee. No matter the size or complexity of the project, there are always variables that will require the re-sequencing of activities (and their start and finish dates) that will push different activities on and off the critical path. The more complex the project the more likely there will be variables that a strong project management team will need to address and work through.
One way project management can be proactive is to have a scheduling consultant on the front end. The consultant can be used in numerous roles including preparing the baseline schedule with the input from the contractor’s project management and subcontractors regarding the appropriate duration for activities. The consultant can assist in a peer review capacity to understand the scheduling plan and perform an objective check of the schedule. Or, the consultant can be used to assist in updating the schedule once the project gets going and variables are encountered. As the idiom goes, “An ounce of prevention is worth a pound of cure.” Utilizing the appropriate assistance to ensure (i) a good plan is in place from the get-go, (ii) that the plan is actually implemented and followed, and (iii) that there are plans in place when variables are encountered, is worth it instead of trying to deal with a bad plan after-the-fact or a good plan that is never actually implemented.
When consultants get involved, they will want to know and understand the project’s critical path. If the consultant gets involved on the front-end, they can assist in determining the critical path based on the project management’s plan. If they get involved after-the-fact, they will want to understand the plan by tracking the baseline schedule with updates that reflect as-built conditions. This will help determine where time impacts / delays occurred. The consultant can then take this information as to those activities that impacted the critical path to figure out why. Was there a bad plan from the get-go? Was there a good plan that was never actually implemented and followed? Were there design errors and omissions that resulted in numerous RFIs, supplemental instructions, or revisions to the plans? Were there numerous changes, whether owner-directed or due to design errors and omissions? Did a trade subcontractor simply struggle with quality control or sticking to durations? These are all issues that will be analyzed in connection with the schedules to best determine why time impacts occurred. Now, when the consultant gets involved after-the-fact, there is a little recreating of history (or revisionist history) since the consultant needs to reinterpret events and schedules after they already occurred. However, if the consultant is utilized from the get-go, hopefully, the time schedule impacts and documentation / evidence is being reviewed and organized to best capture the time impacts. This is valuable because it will allow project management to timely notify the owner of the time impacts and the appropriate extension of time and additional compensation to request. (Keep in mind that most contracts provide that a failure to timely notify the owner results in a waiver of the additional time or cost.) This is also valuable, as explained above, to best determine how to update the schedule and potentially re-sequence scope of work activities and coordinate the trades.
The critical path becomes a very important issue when the project is not going to be completed by the original substantial completion date. Because contracts allow the owner to assess liquidated damages due to delays (or actual damages if there is not a liquidated damages provision), the contractor will need to prove that any delays to the critical path are not its fault, not only to offset any assessment of liquidated damages, but also to establish an affirmative entitlement to extended general conditions. This is why the contractor will want to timely submit a claim for time impacts that include an appropriate amount of time to rebound from the impact. Also, in the event time impacts were in fact caused by the contractor, it will want to know which trade subcontractors contributed to the impact in order to flow down liquidated damages and its own extended general conditions.
Typically, contractors have the burden in proving delays attributable to the owner which will require it to establish the critical path. See Daewoo Engineering and Const. Co., Ltd. v. U.S., 73 Fed.Cl. 547 (Fed.Cl. 2006); accord George Sollitt Const. Co. v. U.S., 64 Fed.Cl. 229 (Fed.Cl. 2005); Morrison Knudsen Corp. v. Fireman’s Fund Ins. Co., 175 F.3d 1221 (10th Cir. 1999); U.S. Fidelity & Guar. Co. v. Orlando Utilities Com’n, 564 F.Supp. 962 (M.D.Fla. 1983). This type of proof will require a witness–really, an expert witness–that understands scheduling and the software used to develop the schedules to explain the critical path and the impacts to the critical path of the project. This will require testimony of the baseline schedule or plan along with the as-built conditions. Without this proof, the contractor is not going to be able to specifically prove that the delay(s) to the substantial completion date was caused by the owner and its consultants. The proof should entail the witness proving the time period in which the impact occurred and the issues that caused this impact (i.e., design error or omission, delay in design professional responding to RFI, design revisions, change order work, etc.). The same burden will be required when the contractor tries to flow down liquidated damages or seek its extended general conditions from a subcontractor that caused the time impacts.
Time impacts, however, cannot be perceived in a vacuum. In other words, time impacts are not always so clean that one discrete issue undeniably caused the delay. Because there are many activities taking place at the same time and many balls being juggled during the course of construction, oftentimes multiple issues that occurred around the same time period need to be analyzed. The reason for this is to determine whether there was a concurrent delay where both parties to the dispute (whether owner verses contractor or contractor verses subcontractor) contributed to the same delay time period, and thus, neither should recover from the other. “The doctrine of concurrent delay involves the premise that where both parties to the litigation caused delays then neither party can recover damages for that period of time when both parties were at fault.” Broward County v. Russell, Inc., 589 So.2d 983, 984 (Fla. 4th DCA 1991); accord Blinderman Const. Co., Inc. v. U.S., 695 F.2d 552 (Fed.Cir. 1982). Hence, if there is a concurrent delay, neither party will be able to recover (which, sometimes, this is what a contractor is seeking to simply offset liquidated damages exposure) unless the contractor can apportion the delay attributable to each party during the concurrent delay time period. See George Sollitt Const. Co. v. U.S., 64 Fed.Cl. 229 (Fed.Cl. 2005); accord Smith v. U.S., 34 Fed.Cl. 313 (Fed.Cl. 1995); William F. Klingensmith, Inc. v. U.S., 731 F.2d 805 (Fed.Cir. 1984).
There is much more to critical path scheduling and proving delays then discussed here. The bottom line is having strong project management requires an understanding of scheduling or utilizing the appropriate scheduling consultant to best achieve the successful and profitable completion of a project.
David Adelstein practices construction law throughout Florida. He has represented contractors, subcontractors, design professionals, developers, associations, suppliers, sureties, and owners in a myriad of construction matters including, without limitation, construction / design defect claims, schedule-based claims (including inefficiency, lost productivity, and acceleration claims), bid protests, payment disputes, lien and bond claims, liability and property insurance issues, and a host of other issues that affect the construction industry. He can be reached as follows:
Address: Kirwin Norris, P.A.
110 East Broward Boulevard, Suite 1570
Fort Lauderdale, Florida 33301
Phone: (954) 759-0026
Fax : (954) 759-0028
When it comes to claims and disputes, I have often heard the proverbial advice that “you should document everything.” However, in reality this is rarely done and it is often impossible to accomplish. Normally, the folks on a construction project simply don’t have the time to write down everything that’s going on at the site and at every project meeting and then respond to every email and phone call. In fact, I would not advise you to try! Doing so would be frustrating at best and counterproductive at worst. Your management team should be focused on managing the project. This is especially true on a troubled project, where you have to put out one fire after another. Your team’s efforts should be focused on using their time in the office wisely and making sure that the important items are properly documented. So, how are they supposed to know which of the items are the most important to document? This article attempts to answer that question by establishing some rules and by providing an objective framework that can be used when deciding how and what to document.
1. SUPPORT YOUR POSITION
Spend the time to write the letters or emails that support your position and explain why your position is correct. This should be the overall framework from which you are focusing your documentation efforts. Document the issues and events as they occur; take a photo, write an email, or put an extra note in the daily report that explains the event or occurrence from your perspective. Pay particular attention to items that delay or disrupt the critical path work on the project, such as: design errors and omissions, missing information (such as unanswered RFI’s), differing site conditions, changes that disrupt the critical work, critical path delays (inability to start or finish work in the critical areas of the project), loss of productivity (interference or additional mobilizations to complete work in the critical areas) and acceleration (working overtime to make up lost time or compression of work or stacking of trades in a schedule). In general your documentation efforts should be focused on those things occurring on the project that results in a growth of cost and that could not have been anticipated at the time of bid. Make sure there is evidence in the file that supports and explains your position as to why the growth in cost occurred. Connect the dots between the event or issue and the actual growth in cost. You’d be surprised how the resolution of an issue was won or lost based on the existence or absence of a crucial piece of documentation in the file.
2. RESPOND TO EVERY LETTER
When is it necessary to write a letter? When someone writes one to you. It is not necessary to engage in a letter-writing campaign (it is simply not true that the person with the highest stack of letters automatically “wins”). But, for each letter that’s written to you make sure there is a written response in the file. One solid letter for each issue is a good rule of thumb. Get your points documented, keeping in mind tip #1, above.
3. BE PROFESSIONAL
In your written correspondence, always be professional and stick to the facts. Be objective, rational and unemotional. There is no need to tell the owner’s rep that he’s an idiot (even if he is). Many people may be involved in the resolution of the dispute after the project is over and they may never meet you. People are going to form their opinions of you based on what you say and how you say it.
4. GIVE NOTICE
Notice provisions are written into contracts for a reason. Their purpose is to give the other party time to investigate, mitigate expenses, and track costs. Read your contract and make sure you are complying with the notice requirements. To make giving notice easier, we recommend that our clients develop form notices. At a minimum, we suggest having form notices available for each of the following situations: (a) Excusable Delay / Request for Time Extension, (b) Differing Site Condition, (c) Conflicting Specifications, (d) Acceleration (Directed or Constructive), (e) Disruption of Work Force, and (f) A/E Change. Have your lawyer review the notices before using them in the field.
5. RESERVE YOUR RIGHTS
I have been involved in several lawsuits in which the judge upheld signed releases on payment applications and change orders, and barred recovery for delay / disruption damages. Have your lawyer review the release language on any document before you sign it. At a minimum, cross out the offending language, or simply write that you are reserving your right to additional money or time for the impact encountered on the project or as a result of the change.
Knowing how and what to document will keep your team focused on managing the project and put your company in a much better position when it comes to resolving disputes when they arise.
Construction claims can be costly for all parties involved. There are the costs of attorney’s and expert witness fees and potentially years of waiting without resolution. There are also more hidden costs to deal with, such as lost management time, impacts on the company’s reputation, and the decreases in team morale as the claim remains unresolved.
It is critical to make sure the damages in a construction claim are calculated and presented correctly to ensure your best chances at negotiating a quick and reasonable settlement. This article deals with the application of some of the most common methods used to prove damages in one of the most common types of claims faced by contractors on construction projects – lost labor productivity claims.
Total Cost Method
With the total cost method, lost labor productivity damages are calculated by comparing the actual costs with the expected or bid costs. The difference between the actual and expected costs is presented as the claimed amount.
It’s also possible to modify the total cost claim by subtracting for bid errors and cost overruns that were not the fault of the other party. This “modified total cost” method is often cited as being more credible than the unmodified version.
Be aware that the total cost method is controversial and sometimes disfavored by courts and boards. To use the total cost method effectively, it should only be used when
Discrete Cost Approach
With the discrete cost approach, labor costs are tracked and attributed to specific events (using cost codes, labor codes, etc.) and then combined into a lost productivity claim. Compared to other approaches for pricing lost labor productivity damages, discrete methods are generally preferable, provided that the requisite project cost data was collected on the project.
When using the discrete approach, care should be taken to segregate damages (unanticipated or increased costs) from the normal project costs. Discrete approaches are highly effective in pricing direct impact costs but less effective in measuring and estimating the indirect costs associated with certain types of claims.
Measured Mile Method
The measured mile method is the preferred approach to pricing lost labor productivity claims. This method contrasts the contractor’s performance during an impacted period with the contractor’s performance during an unimpacted period on the same project. Labor productivity is measured and calculated for both periods (i.e., square feet of drywall per labor hour, linear feet of underground piping per crew day). The main advantage of the measured mile method is that it does not rely on the bid estimate or “as planned” labor productivity. It measures the actual productivity that was achieved on the project and uses that level as the benchmark in the comparison.
With the measured mile method, care must be taken to ensure that the condition under which the measured work is performed is identical except for the impact on the work that is being blamed for the lost productivity. If a reasonable unimpacted period cannot be identified in the same project (i.e., because the project was at least partially impacted in all areas and at all times), then the analyst may look to comparable projects to draw a comparison.
As with the discrete approach, the measure mile method requires robust project productivity data, which may or may not be available. Care should also be taken to account for other factors that could be affecting productivity such as learning curve, ramp up effects, or weather.
Industry studies, industry benchmarking, and other similar approaches are generally seen as being less effective than the other methods described above. These approaches are sometimes useful for claims in which the comparative labor costs are non-specialized or highly repetitive, or as objective references when estimating lost productivity on a forward-pricing basis.
Choosing the correct method for calculating damages in a construction claim is a challenging but an essential part of the claim process. It involves collecting, categorizing, and analyzing project costs using the proper methodology to prove the accuracy of the costs being claimed. It also requires a superior understanding of the behavior of costs on a construction project so that the correct and relevant costs are identified and documented.
As discussed above, it is important to take into account the effectiveness and acceptability of the method being used to calculate lost labor productivity claim damages. Since each method has its own strengths and weaknesses, and is accepted to a greater or lesser degree, going with the wrong method for a particular claim can mean a less-than-favorable result. At Florida Consultants, we are often retained by contractors to review their records and help them choose the best method for calculating lost labor productivity damages on a construction project. If you have a delay or productivity claim contact us today and speak with one of our construction claim specialists. Our claim specialists have focused their careers on solving the most complex construction problems and disputes. Let us put our experience to work to help you find successful resolution to your construction claim.
In How to Update a Construction Schedule – Part 1, we examined why schedules are updated, what a baseline is, and the why the frequency of schedule updates are determined by project complexity, unexpected events, and contract requirements. In Part 2, we will explore the actual steps in properly updating a construction schedule.
Step by step procedure for updating a construction schedule
Updating a construction project schedule is a systematic, step-by-step process that includes the following steps:
The first step in updating a construction schedule is to gather the activity status information. This involves gathering and estimating the following information about each activity in the project schedule:
Actual Start Date The Actual Start Date is when meaningful work will began on the activity. Note: this may not be the first day that work was performed on an activity. Typically, it’s the day that work is started with the intention of working continuously until the activity is completed.
Completion Status At the time of the schedule update, some activities will not have started, some will be in progress, and other activities will have been completed. The activities that are in progress at the time of the schedule update should receive the most attention.
Remaining Duration For any in-progress activities, the remaining duration should be estimated based on (a) how much of the planned work is completed and (b) how much longer it will take to complete the activity. This requires a review of the level of productivity being achieved.
Actual Finish Date Like the actual start date, the actual finish date may not be the last day work was performed on a particular activity. The actual finish date is generally defined as the day when the successor activity can begin and continue without being hindered by any remaining minor work of the predecessor activity being reviewed.
Activity status information can be gathered from a variety of sources, such as:
Once the activity status information is gathered, the information is input into the scheduling software, the status/data date is adjusted, and the schedule is recalculated. The recalculated schedule at this step in the process is often referred to as a “half-step” schedule – that is, the baseline schedule updated with the status information with no changes to logic, original durations or any activities added or deleted.
This half-step schedule can be used to review and analyze the project status. During this review and analysis, the project team should address certain key situations and events, such as:
Discrepancies between the new forecast completion and the contractual completion date. If there is a large discrepancy between the forecast and contractual dates, the baseline and updated schedule should be compared and analyzed to determine the cause of the discrepancy.
Shifts in the critical path. If a critical path shift has occurred, the baseline and updated schedule should be compared and analyzed to determine the cause of the shift and, depending on the reason for the shift, whether corrective action is needed.
Significant changes in float. The reason for any significant changes in float for individual activities should be determined and analyzed. Special attention should be paid to near critical activities.
Scope of work changes. If there have been changes to the scope of work, then activities should be added or deleted as needed and appropriate logic ties made to the un-changed work.
Delays or other impacts. Impacts such as weather, lack of manpower, lower-than-expected productivity, design deficiencies, etc. should be taken into account and the schedule adjusted accordingly.
If the construction project has proceeded as planned and none of the above situations have affected the schedule, then the update process is complete and the schedule can be published and implemented. However, as is usually the case, the schedule will need to be modified and revised as a result of changes in the anticipated conditions. These revisions and modifications take the schedule from a half step to a full and complete schedule update.
Generally, revisions made to the updated schedule to reflect current project status can be categorized as follows:
The updated project schedule should reflect the way in which the project team plans to complete the project. Once the updated schedule is complete, the final step is to publish and implement the schedule – that is, use it to plan and manage the ongoing and upcoming work onsite.
The above steps for how to update a construction schedule are vital to keeping an accurately updated project schedule. An incorrectly updated schedule can result in a tool that is less useful to the project team as it manages the completion of the project. The information above and in Part 1 is meant as a guideline and not a foolproof plan for success. For true expertise from a reliable, experienced source, trust Florida Consultants to help you get your construction project off the ground, properly planned and completed on time and within budget.
Things change rapidly on construction projects: the site changes; the weather changes; personnel and equipment change; the design changes. Impacts and challenges occur that must be overcome. The original plan for the project may quickly become obsolete. As a result, on nearly all construction projects the schedule needs to be updated on a regular basis to ensure that it reflects the team’s current plan for completing the project.
This article provides a step-by-step method for updating and modifying a construction project schedule to reflect the current project status.
Why schedules are updated
Schedules are updated at regular intervals in order to:
The most important reason for a schedule is to track and monitor project status. The status of each activity should be evaluated independently in order to serve as the basis of evaluating the project’s overall status.
Almost all construction projects require that the project be substantially completed by a specified date or within a specified duration of calendar days. If a contractor fails to complete the project on time, the contractor may be charged liquidated damages or be liable for actual damages for each day the project is late. Thus, it is very important that the team know the currently-forecasted completion date so that the plan can be adjusted as necessary to mitigate delayed completion.
Historical update information can be used as a basis to plan and schedule future projects. It can also be a useful in a claims situation or if a forensic schedule analysis is needed to analyze and identify liability for project delays.
Establishing a baseline schedule
In order to be meaningful, there has to be an official baseline schedule to compare against in order to determine a project’s status. The baseline schedule is the starting point in preparing a schedule’s update. The current baseline is the contemporaneous schedule in effect since the last time the schedule was updated. The baseline schedule is the schedule that progress and the affect of changes since the last update are measured against and analyzed.
Frequency of updates
The frequency of updates should be determined by:
The more complex a project, the greater need for more frequent updates. Complex projects have more entities working at the same time, thus they require more coordination.
When an unexpected event occurs that will impact the ability to complete the project on time, the schedule should be updated. The updated schedule will become a valuable tool in order to develop strategies to overcome and mitigate the impact of the unexpected event.
At a minimum, the schedule should be updated as specified in the contract documents. For most projects, the schedule is updated monthly to correspond with the contractor’s pay applications. Monthly updates are normally sufficient, however some sophisticated owners require weekly or bi-monthly schedule updates.
Florida Consultants seeks to educate and inform by way of our blog. We choose such topics because we know them, inside and out. If you have further questions about how to update a project’s schedule, this post will be continued in Part 2, where we outline the step-by-step procedures.. We’re also available via phone and form for your questions or comments!
At a recent industry event, someone asked me about the statute of limitation in Florida for a construction defect claim. My answer was “I’m not a lawyer but I’m pretty sure it’s four years.” The question prompted me to look it up and make sure I was right.
According to the International Risk Management Institute, Inc. (IRMI) a construction defect is defined as:
“A deficiency in the design or construction of a building or structure resulting from a failure to design or construct in a reasonably workmanlike manner, and/or in accordance with a buyer’s reasonable expectation.” The most dangerous defects have the capacity to fail, resulting in physical injury or damage to people or property.
Some examples of a potentially dangerous construction defect include things that can cause physical injury or damage to the property, things like:
According to IRMI, many defects aren’t dangerous but can cause harm in the form of deprecation in the value of the property and extra expenses. For example:
Turns out, it is four years. The statute of limitations for construction defect disputes in Florida is defined in Florida Statute §95.11(3)(c). Under the law an owner has four years to initiate a lawsuit, with the clock starting on the latest of the following four dates:
However, if the construction defect is latent (not readily visible or obvious), the statute of limitations commences on the date the latent defect was discovered. But, according to the statute, under no circumstances can an owner initiate a lawsuit more than ten years after the dates/factors identified above. This 10-year cap is referred to as the Statute of Repose.
If you are considering filing a construct defect claim or if you are a contractor, subcontractor or supplier facing a defect claim, give us a call. Florida Consultants’ thorough and expert knowledge of handling a construction defect claim in Florida can help you along the way.
Next week, Florida Consultants is in our nation’s capital attending the annual cost engineering conference hosted by the Association for the Advancement of Cost Engineering (AACE) International.
AACE International is a non-profit organization with the purpose of teaching and advancing cost and schedule management best practices as well as programs in cost estimating, cost eliminating, planning and scheduling, risk management, project management and control, and earned value management.
At the annual conference, we join hundreds of other construction consultants to sharpen our skills at continuing education certification courses and technical sessions. It’s very important to the Florida Consultants team to keep up-to-date on the latest techniques and technologies available to us so that we can use those skills throughout the year to bring greater cost savings and expertise to your projects.