Delayed Performance and Extra Work
Our attorneys provide guidance to clients in construction disputes throughout the State of Missouri. This guidance has included reviewing, drafting and editing construction contracts or contract language related to the performance of work, as well as advocating for clients in disputes over such language, such as disputes regarding the scope or timing of work under the contract. The attorneys with our Firm have the legal knowledge and experience to advise you regarding these types of issues and navigate any disputes about them.
Timing and Delays in Construction
Delays in construction projects arise frequently. Delays can result from a variety of factors and scenarios during a construction project. These factors include material backups, weather, unforeseeable defects or obstacles, or design problems. Delays often create disputes and tension between a property owner, contractor, subcontractor, architect, and/or suppliers. How such disputes are resolved often depends in large part upon the language of and parties to the contract.
Generally, private commercial parties have the freedom to draft, structure, and agree to written contracts as they see fit. See Purcell Tire & Rubber Co., Inc. v. Executive Beechcraft, Inc., 59 S.W.3d 505, 508 (Mo. banc 2001) (“sophisticated parties have freedom of contract—even to make a bad bargain, or to relinquish fundamental rights”). This general rule is also true in the context of construction contracts. See, e.g., R.W. Farmer Const. Co. v. Carter, 454 S.W.2d 30, 32-33 (Mo. 1970) (finding construction contract term providing for daily liquidated damages for construction delays to be valid). Thus, disputes about delays in construction may be decided based on the language of the construction contract itself.
However, like any other contract, parties may challenge contractual terms as being invalid or unenforceable for one or more reasons. And the merits of such contract challenges or defenses often depend on the nature of the contract, the specificity of its language, the intent and understanding of the parties to the contract at the time of contracting, and the underlying facts and circumstances that lead to the delay or dispute in question. In addition, Missouri law provides additional rules regarding the types of contract terms that are not permissible in “public works contracts.” One of these rules is specific to contract terms that address how costs for delay may be handled under a public works contract. See, e.g., § 34.058 RSMo.
Absent such challenges, defenses or other particularized laws, courts tend to allow private parties to contract freely and to hold them to the terms of whatever agreement they reached. See, e.g., Roy A. Elam Masonry, Inc. v. Fru-Con Construction Corp., 922 S.W.2d 783, 789-91 (Mo. Ct. App. 1996) (discussing enforceability of “no damages for delay” clauses in private construction contracts and affirming enforceability of clause at issue).
Missouri courts have drawn distinctions between “extra work,” “additional work,” and “alterations” in the context of construction disputes. See Wisch & Vaughan Const. Co. v. Melrose Properties Corp., 21 S.W.3d 36, 40 (Mo. Ct. App. 2000). “Extra work in the context of building contracts refers to work not contemplated by the parties at the time of contract and entirely independent of what is required in performance of the contract.” Id. “Additional work is work necessarily required in the performance of the contract, but the necessity of which arises from unanticipated conditions.” Id. “Alterations are changes in the form of the work which do not destroy its identity.” Id. Ultimately, the “determination of whether [an] item or activity is ‘extra’ and not something already contemplated under the contract, is [a] question for [the] finder of fact.” Id.
An instructive example of “additional work” was described in Webb-Boone Paving Co. v. Missouri State Highway Commission, wherein the Missouri Supreme Court held that because the contract was broad in describing, among other things, the excavation to be done and did not make any misrepresentation regarding subsurface conditions or other relevant aspects of the project, the contractor was bound under the contract to work through difficult and time consuming soil conditions without additional compensation. 173 S.W.2d 580, 584-85 (Mo. 1943) (noting “[t]he case is one of misfortune rather than one of misrepresentation”).
The determination of whether work is “extra” or “additional” under a contract often requires detailed review and analysis of contract terms and potentially other statements, actions, or circumstances surrounding the dispute. Nonetheless, even where a contractor does not have an express breach of contract claim, the contractor may have other equitable causes of action through which it can recover unanticipated losses, such as unjust enrichment. Hiring an attorney is critical for a contractor or other party to understand the nature and scope of its rights and duties in connection with a construction contract and what potential courses of action may be taken to resolve a contractual dispute.
Often, construction contracts will contain terms that specify that any change to the original plans must be made through a written change order. These types of terms typically exist to prevent dispute between the parties regarding the nature and scope of work to be performed under the contract. Thus, as a general rule, when a contract requires a contractor to obtain a written work order before beginning any extra work, the contractor may not recover for the work unless it first obtains such a written change order. See Wisch, 21 S.W.3d at 41.
However, Missouri courts have also recognized that a change order requirement in a contract may be effectively waived under certain circumstances. Id. “[W]aiver of a written change order [requirement under a contract] may be accomplished by either habitual acceptance of work completed upon oral change orders or by presenting evidence that the parties agreed to the changes and the changes were completed.” Flooring Systems, Inc. v. Staat Const. Co., 100 S.W.3d 835, 838 (Mo. Ct. App. 2003). Nonetheless, to avoid such fact-intensive disputes, it is strongly recommended that all change orders be made in a writing signed by both parties.
To review and discuss your legal rights and obligations in connection with an extra work or change order dispute, please do not hesitate to contact our attorneys at (314) 645-4100 or by email at email@example.com.