DELAY DAMAGES ON PUBLIC CONSTRUCTION PROJEC AVAILABLE EXCEPTIONS TO “NO DAMAGES FOR DELAY” CLAUSES. Te our last ate, we outlined what we perceive to be the misapplication of M.G.L €.39, §390 by the Cours ofthe Commonwealth, Iti clear that in stil limiting the circumstances under which a contractor can obtain an equitable adjustment for owner-cause delay as required by M,G.L.c. 30, § 390 (only when the owner issues writen "stop work” order) the Courts have set avery high bar for contractors overcame. De Spite the narow interpretation currently accorded §390, contractors in evan circumstances may stil be able to recover damages (in the absence of "stop work” order) when the ations of the owner are unreasonable an si icantly interfere with or hinder progress ona project. [As noted in out as aticle, a “no damages for dela” clause may be rendered unenforceble when there has teen a “complete failure of [the publi owners] agents [0] promplly te afford tothe contactor the protetion extensions and the opportunity to reschedule its work during performance.” See Farina Bros. Cov, Common al, 357 Mass. 131,139(1970). This means that damages may be recoverable where the owner ort agents fail to seasonaly grant a reasonable ime extension where the contractor has requested same, The Appeals Cou in Binden v Winchendon Housing Authority stated that this exception tothe “no damages for delay” provisions ofa contracts based onthe concept tl an awarding authority deserves no protection fom delay damages where its“arbitary nd capricious conduc... produces the delay andthe authority declines even to extend the me for completion.” 28 Mass App.Ct.977, 978 (1990). Applicaton of these principals aceuronly upon a showing of extreme circumstances of ha fit onthe par ofthe awarding authority. Further, her jurisdictions have aeknowledged exceptions to “no damages for delay” contrat provisions whch ae nt inconsistent with Massachusetts la (but which have not yet been directly akowedged by Masse huss). For example. a "no damages fr delay” clause may nat be enforeed if he delay encounteres is no of = type mentioned inthe contrat language. See, e.g. U.S. tndustrcs, Ine, v. Blake Const Co, in, 671 F.2d 839 224 (D.C Cir 1982) (where contrat only procluded “contractors o subcontractors” from bringing delay claims, uppers and vendors were not preclided rom bringing Such claims). Other jurisdictions have alo refused to enforce a“ damages for delay” cause where the delay was "(1) not contemplated by the parties under the pro Vision, 2) an abandonment of the contac, (3) caused by ba faith, or (3) feused by) active interference” U. Steel Corp. Missour Pac, RCo, 668 F24-435, 438 8th Cit 1982): sce also Jom E, Grezory & Son, ln CA. Guenther & Sons Co, 147 Wis d 298, 32 N.W.2d 584 (1988) (delay not contemplated by parties is an ception to te general rule that "no damages for delay” clauses are enforceable). Whether a particular type of lay was contemplated by the paris is ofcourse subject o debate and wil be governed by the law of contract interpretation. See eg. Dickson v. Riverside Irn Works Inc, 6 MassApp.C. 3,55 (1978 (citations omitted) [CiWe must. examine the ercumstances surrounding the making ofthe contract to determine the objective in- ten ofthe partes. "[lhe literal interpretation of any word or phase may be qualified by the context in which it appears, by the general purpose manifested bythe entire contract and bythe circumstances existing atthe ime the contract was executed”) {In adtion to granting compensation for delays that could not have been foreseen, Federal jurisdictions have carved out an exception to the general ale for “[ajy unreasonable delay attributable solely and diretly to the Goverment” Meza Const-Co, ng. v.US. 29 FeCl. 396, 424 (Fed Ci, 1993); Wunderlich Contacting Co, United States, 173 CUCL. 180, 351 F24 936, 967-68 (1965). In allowing for this exception, the Court in Meas-Consiuction didnot require the contractor to demonstrate thatthe completion date was delayed an instead requiring a showing ony that "(delay to par of the performance” had occured. 29 FeCl. at 424 Another bass for not enforcing a “no damages fr delay” clause hasbeen aniculated bythe Colorado Ap- peals Court in Trigon Kent Co, v. Lafarge North Ameria, In. 186 Pd 155 (Colo.App.2008). The Cour sated hat "no damages for delay” clause is unenforceable where the owner actively interferes withthe contractor's performance. Similarly, the Second Circuit Court of Appeals has Stated that “elven if itis determined thatthe CIM Construction Journal 39no-damages-for-ilay clase applies othe extra work performed pursuant to the change orders, such a cause wil ot seve to prevent recovery of damages for delays caused by the [public owner) bad faith or its wif, male sious, or grossly negligent conduct.” Williams and Sons Erectors ine, South Carolina Sicel Corp. 983 F.2d 1176, 1184 (C.A.2 (N-Y,),1993) (emphasis adds), Contractors can also seck damages by demonstrating the existence of “true breach’ of contac, 8 op: posed to secking reli under a clause ofthe contact. “When a particular claim falls outside the contact, such that it snot redressable under specific contact adjustment provisions iti a "tue" breach of contact lai that may justify an award of damages.” Suton Corp. Metropolitan Dist Com'n, 423 Mass, 200, FN 22 (1996) An example of such cluim inthe context of project delays is lustrated in United Stags v, Utah Cons & Min: ing Co, 384 U.S. 394, 86 S.C, 1545 (1966). In that ease the Court found tht the “disputes” clause ofthe con. tract didnot extend to claims aginst he awarding authority for bresch of contact causing unvessonable dla ad that therefore, the owner's unreasonable delay was a “eve breach” of contract fr which there was no eemedy provided in the contact. Id. In Massechusets, the cours generally tend to consider & “tue breach fo equate & wrongful” breach of contract based on the conduct ofthe awarding authority. Thomas O'Connor & City of Medford, 16 Mass.App.Ct. 10,13 (1983), citing Glynn v. Gloucester 9 Mass.App.Ct 454,460 (1980) ‘There ae two common themes characterise of the exceptions tothe general rule (1) delays that could not have been foreseen; and (2) delays that result irety from the awarding authority's unteasonable interference vith contract performance. The Courts ofthe Commonwealth have demonstrated a willingness to apply this see. ond concept in extreme eases. See Farina and Findlen, supa Whether an owners actions wll be considered “unreesonable,” “wilful” or “malicious,” dependant upon the circumstances. The Colorado Appeals Coun put it well when i sated that “active interference requires ‘more than simple mistake, err in judgment, ack of total efor, or lack of complet diligence.” Trion, supra While not often implemented, conduct amounting to ctve interference has been found to justify damages in Massachusetts“) circumstances... [wher] the [ower] in effet has used the. provisions of the eon whipsaw the contactor" Farina Bros. supra. at 138 Until such time that M.G.L. c, 30, § 390 is amended to allow for an unrestricted award of delay damages upon showing that an awarding authority's delay eauses the contractor pecuniary ham, public warks contactors ust rely on arguments arising from the limited exceptions tothe enforcement of “no damages for delay” clases in an stempt to obtain rele. As application ofthese exception i generally granted speringly and ons case by case bass, contractors are advised to govern their conduet accordingly and seek to avoid situations trough ad vance negotiation and proper documenting of isues which arise om public construction projects to alleviate the necessity of having to look othe Cours to excuse the contactor from the burden f “ho Gamal for delay” clause andthe restrictive interpretation of §390 currently recognized inthe Commonwealth, * Amey Heats, who represented Suton Crp. on ppl cations that Masiachuses Cours wil likely only apply shi exception "no damnges for delay” cause where the warding authority is ound wo ane ated nbd ah Harvey B. Heft, Es, «partner Heafit & Slivan a has over thirty ears experience representing contractors in the Conmenavath, James G- Gril, Es. and Scat K Semple are esc wi the te 40 CCIM Construction Journal