All delays obligated with an additional fee if it applies under the rules below. Additional fee will be calculated by each day which equal $900 per day. This fee will be compensated each day for employees who can not continue the project and will be temporarily suspended from that project and can’t start a new project as to not overlap projects and don’t cost delays with the new project which can be started. What is an excusable delay? An excusable delay is any delay caused by unforeseeable events out of a contractor’s control. A contractor is afforded additional time, compensation, or both for an excusable delay. A contractor cannot be held in default for a delay that is deemed to be excusable. Thus, he is not financially liable for the property owner’s resulting losses. When the delay is excusable, the contractor is entitled to an extension of time. However, he is not necessarily entitled to additional compensation. That would require the delay to be compensable. For a delay to be compensable, the property owner or contractor must be responsible for the delay. For example, if there was an error in the construction drawings, and the contractor’s work is delayed as a result, he would be entitled to additional time and compensation. Essentially, when a delay is excusable, it is simply a non-fault verdict. Neither the contractor nor the property owner are liable, and neither party is required to pay any additional compensation to the other. When is a delay non-excusable? A delay is non-excusable when it’s the product of the contractor’s own mistake or negligence. For example, if the contractor fails to apply for permits in a timely manner, and work on the project is delayed as a result, this would constitute a non-excusable delay. Contractors are also responsible for delays caused by their subcontractors. If a subcontractor fails to order supplies on time, and an important stage of the project cannot be completed, the contractor would be in default. It is important to note that a delay can be excusable even if it is not explicitly listed in the contract. Whether or not a delay is excusable is frequently a source of conflict between contractors and property owners, and the courts are often left to sort things out between the parties. Examples of excusable delays Excusable delays are beyond the control of the contractor and cannot be attributable to its negligence or wrongdoing. Specific examples include: • Acts of God (Force Majeure Events): Natural disasters (hurricanes, tornadoes, earthquakes, etc.), fires, and floods can make work dangerous or unsafe, forcing the contractor to put off work. • Delays caused by the owner: For example, if the property owner requests a last-minute change in the design of the project (e.g., wants the building to have a dormer roof instead of a flat roof). • Delays from drawing errors: The contractor relies on architectural drawings for the design and specifications of the structure. If the drawings are incorrect, work may need to be redone. For example, if the drawings show the incorrect roof pitch, the roof may need to be rebuilt. Examples of excusable delay clauses Generally, events that constitute excusable delays are delineated in a clause within the contractor agreement. The clause will identify specific events, occurrences, and circumstances that are considered excusable delays, and what the contractor is entitled to if such a delay occurs. The Federal Acquisition Regulation (FAR) includes a provision that describes how fault and costs are attributed when a contractor’s work is delayed during a government construction project. Many contracts use similar clauses to define the excusability of different types of delays. This provision states: “(a) Except for defaults of subcontractors at any tier, the Contractor shall not be in default because of any failure to perform this contract under its terms if the failure arises from causes beyond the control and without the fault or negligence of the Contractor. Examples of these causes are (1) acts of God or of the public enemy, (2) acts of the Government in either its sovereign or contractual capacity, (3) fires, (4) floods, (5) epidemics, (6) quarantine restrictions, (7) strikes, (8) freight embargoes, and (9) unusually severe weather. In each instance, the failure to perform must be beyond the control and without the fault or negligence of the Contractor. “Default” includes failure to make progress in the work so as to endanger performance. (b) If the failure to perform is caused by the failure of a subcontractor at any tier to perform or make progress, and if the cause of the failure was beyond the control of both the Contractor and subcontractor, and without the fault or negligence of either, the Contractor shall not be deemed to be in default,- unless- (1) The subcontracted supplies or services were obtainable from other sources; (2) The Contracting Officer ordered the Contractor in writing to purchase these supplies or services from the other source; and (3) The Contractor failed to comply reasonably with this order. (c) Upon request of the Contractor, the Contracting Officer shall ascertain the facts and extent of the failure. If the Contracting Officer determines that any failure to perform results from one or more of the causes above, the delivery schedule shall be revised, subject to the rights of the Government under the termination clause of this contract.” – FAR 52.249-14 A little more details: Critical vs. non-critical This is the first and most important question to answer: Was the delay critical or non- critical? A critical delay is one that will affect the project completion date (or some other important milestone date on a project). Critical delays can't really be made up - they just tack on extra time. Non-critical delays will affect the completion of specific activities, but not the completion date or the date of some important milestone. The determining factor is whether the delay extends the Critical Path of the project. A CPM schedule will set out a timeline of the most extended activities throughout the project. It will establish the minimum amount of time it will take to complete these “critical” activities. These critical activities need to be performed at specific times and in a particular order to allow the next critical phase to begin. If the delay has no effect on the project’s critical path, then the delay is non-critical and may involve a simple change order to correct the delay. Excusable vs. inexcusable Once you have determined if the delay is critical or not, you will need to establish whether the delay is an excusable one. An excusable delay is one that allows the contractor an extension of time, compensation, or both. Why? Because these delays are out of the contractor's control. The common excusable delays should be outlined in the construction contract. The most natural example of excusable delays is when a delay falls under a force majeure clause — events such as natural disasters or terrorist attacks. Excusable delays can also result from errors or omissions in the plans or even simple issues that were caused by the client. Inexcusable delays are those where the contractor was entirely responsible for extending the project's duration. If this is the case, then the contractor will be liable for any costs or damages caused by the delay. This can be a result of delayed mobilization, late submissions, failure to obtain permitting (if they're responsible for it), or general poor planning on behalf of the contractor. Compensable vs. Non-compensable delays The final question to ask: Is the delay a compensable one? When a delay is "compensable," it means the party affected by the delay should be given either an extension of time or compensation for the delay of their work. All excusable delays are compensable. This means that any time a delay is considered "excusable," the contractor will generally have a claim for a time extension, compensation, or both. If the contractor is solely at fault, the delay will very likely be non-compensable. Non- compensable delays can fall under any of the other categories, depending on the situation and contract terms.