COVID-19: Delays and the AIA Owner – Contractor Agreements

In these uncertain times unanticipated delays caused by events or actions beyond the contractor’s control are likely, if not certain to occur. The right to an extension of the contract time and, possibly, the contract price depends on the terms of the agreement between the owner and contractor and, in turn, between the contractor and its subcontractors. For projects utilizing the A101, A102 and A103, the relevant provisions are found in the A201 General Conditions. More limited general conditions are included in the A104 itself.

Section 8.3.1 of the A201 states that a contractor is entitled to a reasonable extension of time if the Work is delayed by “unusual delay in deliveries,” “unavoidable casualties,” “other causes beyond the Contractor’s control” or “other causes the Contractor asserts, and the Architect determines, justify delay.” The extension of time must be reasonable “as the Architect may determine.” Section 8.3.1 does not provide for any adjustment in the Contract Price. However, Section 8.3.3 states that Section 8.3 does not preclude delay damages to which the contractor is entitled under any other provision of the contract.

Section 8.2 states that claims for an extension of time must be made in accordance with Article 15 – Claims. Section 15.1.3.1 states that claims must be initiated within 21 days of the later of (a) the occurrence of the event giving rise to the event, or (b) “after the claimant first recognizes the condition giving rise to the Claim.” Claims for additional time should include an estimate of the cost of the delay and its “probable effect” on the progress of the Work.

Section 14.5 of the A104 is essentially identical to Section 8.3.1 of the A201. Notice must be provided in accordance with Section 21.2.1 which is essentially identical to Section 15.1.3.1. The A104 does not include the other provisions identified above, but their requirements provide good guidance.

Timely notice and good documentation are essential. However, regardless of the contract provisions, it is wise to communicate with owners and architects as soon as problems loom.

If you have questions on specific projects, please contact Michael Hodgins or David Pierson. Our office is trying as best we can to work remotely, while continuing to timely and effectively respond to, and anticipate, client concerns.