By: Thomas S. Tripodianos Published: January 2006

Late Start not Breach of Contract

Question. Does a general contractor's postponement of the subcontractor's start date for installation of concrete panels on a building to be constructed constitute a breach of the subcontract where the contract requires the subcontractor to perform work "in accordance with the project schedule" developed by the general contractor?

As is the case with most questions that I receive, the answer lies in the parties’ agreement and the surrounding facts. In this case, the contractor's postponement of the start date did not constitute a breach of the subcontract.

The original start date for installation of the precast concrete panels was shown to have been May and the subcontractor seeks to recover the costs incurred for transportation and storage of the panels resulting from the general contractor's postponement of the start date until September. The subcontract required the subcontractor to perform the work in accordance with the project schedule developed by the contractor. Although the initial planned start date was established as being in May, the date was changed after the subcontract was execute and the contractor had the right to make such changes and such changes were anticipated by the parties. Significantly, the subcontract gave the contractor the authority to set the schedule and placed no limits on its exercise of that authority.

Subcontractor failed to reserve the right to limit changes in the schedule and in fact complained about the start date "slipping away" in August. Subcontractor also failed to ask for a fixed start date. In addition, the minutes of job site meetings, at least one of which was provided to plaintiff before it began fabricating the panels, listed a September planned date for the precast installation.

The lesson to be learned here is that contractors and subcontractors alike must pay close attention to their agreements to ensure that they have the appropriate language to protect them and thereafter make sure their actions or inactions don’t dilute those protections.

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