The Current Climate of Weather Delays
As children, a snow day was a dream come true. But for contractors, severe weather can be a nightmare. That’s because it’s hard to properly account for the risk of weather and still remain competitive, especially in the current economic climate. The delays and costs can be severe, which is only compounded by liquidated damages if the contractor can’t prove entitlement to a time extension.
Each region of the country has a distinctly different climate that produces unique challenges for the local construction industry. While weather is unpredictable, knowing how to define and deal with weather-related issues will help contractors and owners avoid an avalanche of disputes.
The following article will cover typical requirements for establishing entitlement to a time extension due to weather, emphasizing the importance of understanding your contract’s weather-related time extension provisions.
Proving entitlement to a time extension for weather requires one to establish two things: entitlement and impact.
Entitlement
Establishing entitlement to a time extension for weather involves convincing the owner that he or she has an obligation to increase the time provided in the contract to complete the project work. It should come as no surprise that the contract is important to this discussion. It is common for time to be “of the essence” in a construction contract. It is also common for “contract time” or the contract completion date to be terms defined by the contract. In addition, given the contract’s role in defining the sharing of risk, especially the considerable risk associated with weather, it is common for the contract to specifically address how weather-related time extensions will be determined and administered.
Understanding Your Contract’s Weather-related Time Extension Provision
It’s important that the contractor also know if, how, and in what form the contract grants additional time for severe weather. The contract language for granting extra time for weather delays can vary from allowing recovery of one workday for every workday lost to contracts that allow no time at all.
An example of the former type of time extension provision is the Ohio Department of Transportation’s (ODOT’s) provision that states, “The Engineer will grant a time extension for every workday that weather reduces production by more than 50 percent on items of Work on the critical path.” Whereas, the New Jersey Department of Transportation’s (NJDOT’s) provision is more restrictive because it only grants weather-related time extensions when the contractor’s operation is limited by adverse weather conditions that it defines as, “floods, tidal waves, earthquakes, cyclones, tornados, hurricanes, or other cataclysmic natural phenomenon.” As such, these two provisions would grant two substantially different amounts of additional contract time for weather on a given project. Understanding how your contract determines and grants time extensions due to unusually severe weather can have a significant effect on the profitability of your project.
Measuring Unusually Severe Weather
Establishing that your project experienced “unusually severe weather” can be a challenging task. The most common method is to compare the actual weather experienced on the project to some historical norm for the same location. A reliable source for identifying the historical norm in a particular location is to reference the National Oceanographic & Atmospheric Association’s (NOAA) National Weather Service website located at Weather | National Oceanic and Atmospheric Administration (noaa.gov). From this website you can find historical daily and monthly weather information collected from thousands of weather stations located across the country. By using the historical data collected from the weather station located closest to the project site, a norm or expected level of severe weather can be established for a given time period. If you feel your project experienced a significant amount of rainfall in a given month, then you can collect the historical rainfall data from the weather station located closest to your project site and establish the monthly historical precipitation averages that your project site could have expected to experience.
Reasonably, these monthly historical averages represent the minimum precipitation that a contractor should anticipate each month during the course of the project. A similar approach could be used to evaluate temperature. Establishing expected levels of inclement weather on a monthly basis dovetails nicely with many construction contracts that require the contractor to submit weather-related time extension requests at the end of each month. Once the expected quantity of inclement weather in a given month is determined, the actual amount of inclement weather experienced, measured in inches of rainfall, snowfall, or abnormally high or low temperatures, can be compared to determine if the actual project weather conditions exceeded the norm.
You can measure the actual amount of weather that your project experiences in two ways. The first option is to rely on the actual weather data provided on NOAA’s National Weather Service’s website for the given time period. Perhaps a more compelling option is to track the daily temperature and daily level of precipitation on the project yourself using either daily job reports or monthly progress reports. If the actual weather experienced on the project exceeds the norm, then the next step, as set forth in the previous paragraph, is to establish that this abnormally or unusually severe weather delayed the project. This is where the significance of the ASBCA case mentioned in the first paragraph of this article becomes significant.
ASBCA Ruling on Unusually Severe Weather
In a Armed Services Board of Contract Appeals decision, All-State Construction, Inc., ASBCA No. 50513 (Sept. 22, 2004), the Board identified two separate definitions of “unusually severe weather” in its ruling. The Board concluded that the term “unusually severe weather” includes both: 1) an unusual number of days of severe weather at the work site; and 2) unusually severe weather conditions (e.g., unusually heavy snow or rain, unusually high tides, unusually high or low temperatures) during a particular period at the site. Id. In this case, the defendant argued that when determining whether a project experienced unusually severe weather “the correct approach is to first determine the historical average number of days of unusually severe weather that can be anticipated in each month and then find as excusable only the number of days that exceeds the historical average.” It contended that “the Board appears to have applied an incorrect legal standard by considering each day that the temperature fell below the historical average as severe weather constituting excusable delay.” Id.
In its ruling, the Board explained that the defendant neither provided case support for its assertion that the contract required proof of an unusual number of days of unusually severe weather, nor was the Board aware of any such precedent. The Board stated, “minor deviations from the historic normal average daily temperature do not necessarily amount to unusually severe weather.” However, it determined that a seven-day period of time when the project experienced a 52 percent downward deviation below freezing for the particular project site to be a major deviation and “unusually severe in the context of construction work in cold weather.” Id.
When making its ruling, the Board relied on the second definition of unusually severe weather, “unusually severe weather conditions (e.g., unusually heavy snow or rain, unusually high tides, unusually high or low temperatures) during a particular period at the site.” In applying this definition, it appears that the Board did not offset the actual weather with some historical expectation for inclement weather and granted the plaintiff all of the time requested during an unusually severe weather event. Id.
This decision should encourage contractors to reevaluate how they interpret the weather-related time extension provisions they encounter. Based on this Board’s ruling, in instances when the contract does not define “unusually severe weather,” and the weather encountered is unusually severe in an absolute sense, the contractor may be entitled to a time extension for every day such weather occurs without having to offset the lost time by an expected amount of downtime due to weather that the contractor should have anticipated.
Impact (Delay)
The ability to identify the number of days that the actual precipitation exceeded the monthly average or the number of days that the temperature fell below the norm is only the beginning. You must first demonstrate that the adverse weather experienced at the project site limited your ability to perform work on those weather-affected days. This is typically accomplished by relying on your foremen’s daily reports or the inspector’s daily reports that identify days when the crews were sent home or were unable to work due to weather or field conditions.
The second element you must demonstrate is that the unusually severe weather delayed the project. This requires the contractor to establish that the weather-affected work was on the project’s critical path, because only delays to the critical path can delay the project. The critical path is commonly defined as “the longest continuous path of activities that establish the earliest the project can finish.” In most instances, the contractor will need to rely on the project’s schedule, hopefully a critical path method (CPM) network schedule that allows the critical path to be identified easily, to determine if the weather-effected work was, in fact, on the critical path and that the adverse weather resulted in delay to the project.
Conclusion
In the construction industry, as in many other industries, the contract allocates the risk for all parties involved. It is essential to have a clear understanding of how the contract distributes the risk to ensure that your expectation of the parties’ responsibilities coincides with the actual allocation of risk specified in the contract. In addition, knowledge of the contract will enable you to effectively plan the project and deal with the problems that arise over the course of construction. Ultimately, understanding how the contract allocates the risk associated with adverse weather conditions between you and the owner and the different methods that weather-related time extension requests are granted will enable you to properly identify, document, measure, and ultimately submit successful weather-related time extensions.
Scott Lowe P.E., Principal, and Mark Nagata PSP, Director/Shareholder, are both members of Trauner Consulting Services, a firm with expertise in the area of construction delays.
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