Delays take place on almost all construction projects, whether it is the construction of an underpass, a bridge, a skyscraper, office complex, suburban tract, housing project and the like. Numerous contractors are at the risk of losing time and money by either waiting on project owners or dealing with events beyond their control.
If the delay was caused by an occurrence which is not in the contractor’s control, they can make a claim in terms of time extension (alternatively Extension of Time (EOT)).
Most of the time, contractors will only receive an extension of the schedule. They won’t be reimbursed for additional expenses. However, not all situations are the same because each one is different.
Let us now have a more detailed look at an EOT claim in the construction industry, plus the valid reasons for such a claim and in what ways a contractor gets paid, plus tips for submitting a successful claim.
Extension of Time (EOT) claim – an overview
An Extension of Time (EOT) claim (alternatively known as a time extension claim) is basically a request for amendments to be made on the scheduled date of completion. A reason for such is because of a delay where the contractor is not at fault. Such a delay can be created by natural events, delays caused by owners or other happenings which were not expected.
The process of filing one
The process for filing a time extension claim is outlined in the contract between a general contractor and a project owner. Subcontractors must hence abide by the terms of their contract with the general contractor.
Most of the time, such terms require a written notice of delay and an official claim with substantial documentation to support it, which is then reviewed by either the contractor or the project owner. If the extension is approved then a change order is hence produced and implemented.
What should time extension claims be able to establish?
Time extension claims should be able to establish cause and be liable for additional expenses or delays in schedule, plus the extent of the disruption or damages caused.
Reasons validating filing of a time extension claim
All contracts are not the same. Each contract will have specific terms which establish legitimate reasons when it comes to an EOT claim. This is why contractors and project owners must review and refer to their contract for any and all claim clauses which are permissible.
Here are some reasons which can be covered:
Delays due to weather
A time extension claim (EOT Claim) covers weather events of high significance. However, if any event would have been foreseen, like weather patterns during the hurricane season; contractors would then be required to take some protective measures for protection against delays before they make a claim.
Natural Acts (aka Acts of God) along with Force Majeure events
Natural events (or acs of God) that can cause a delay, like the aftermath of an earthquake, a tsunami or a torrential rain can be covered by a time extension claim.
Force Majeure takes place when superior external forces like a storm, or a natural disaster affect the project’s participants’ ability to successfully complete their specific responsibilities completely, or in a timely manner in a certain construction project.
It was during 2020 and the first half of 2021 that a lot of construction companies had to stop their construction projects due to lockdowns induced by the COVID-19 pandemic. The pandemic itself was translated as a force majeure event and EOT claims were covered during that time.
Problematic law and order situation (including terrorist attacks)
Problematic law and order situations can be covered by EOT claims, especially if rioting or another specific event like a terrorist attack or another criminal attack affects the job site, access to it, or both.
Delays created by the project owner
EOT claims cover delays started by project owners. Dispute avoidance experts state that due to it being a matter of law, a principal cannot benefit from their own wrongdoing. Project owners are often termed as principals in legal documents.
Also, it would be an unjust outcome from a project owner if they can delay contractors from completing their work. Hence, there would be no way to change time, or make adjustments to it, under the contract.
Tips for making a successful EOT claim
For each thing to happen successfully, there are handy tips behind it that help people achieve such things successfully. The same goes for Extension of Time (EOT) claims (alternatively time extension claims).
Any kind of construction claims is not easy to achieve because there are certain steps needed to make sure they are achieved. The same goes with EOT claims because they are tricky. Yes, they are tricky and many at times, project owners often find an excuse or two to overturn it.
Hence, a delay expert has identified the following tups for making a successful time extension claim:
- Reading the contract.
- Sending timely notices.
- Documenting each and everything.
- Keeping an updated and up to date schedule.
- Submission of a change order.
- Conducting follow ups on a long delay.