Government Contracting Database
Government construction contracts specify a required completion date. However, the contract does not specify that the contractor cannot complete early. In other words, no contracts are written that state that the contractor must complete the project within 360 calendar days no more – no less. Rather, they state that the contract must be completed within 360 calendar days from the Notice to Proceed. A construction contractor has the right to complete a project early. In fact, when one assesses the situation, the low bidder should be the contractor who has most efficiently planned the use of his resources to complete the project. In the planning of his resources, a contractor saves money by saving time. If the contractor can plan on finishing that project early he will save money and be in a more competitive position when he submits his bid. Should a contractor be delayed from completing a project early, he may also be entitled to compensation for this delay. It must be recognized that the government is not generally very receptive to a request for additional compensation based on the inability to meet an early completion date. However, if the contractor can reasonably demonstrate through the use of his schedule that he could have completed the project early but for the government delays, he is entitled to the additional compensation. In the context of completing a project early, contractors should bear in mind that the schedule they are required to submit at the inception of the project should reasonably and accurately reflect their plans on completing the project. For instance, if the contractor in the example above had originally planned to complete the job in 200 days, then the original schedule submission to the government should reflect the 200 day duration. Many contractors will argue that they are going to submit a 300 day schedule to the government and utilize a 200 day schedule in their actual management of the project. This creates several problems. First of all, assume that the Contractor is planning to complete the project early. Therefore, should he be delayed and request compensation, his request becomes all the more questionable. Second, all too often the subcontractors will be given the 200 day schedule but find out that the government has been given a 300 day schedule. This creates more problems for the General Contractor. Third, the federal government has the right to know if the contractor is going to complete early so that it can base its pay schedule accordingly. As most contractors are aware, when the government begins a construction project, the government does not necessarily have all the funds in place to pay the contractor for the project Therefore, in order to assist the government in its fiscal management, only one schedule should be used. Should a contractor submit a schedule which shows that he will complete in a time frame less than that specified in the contract documents, it is not uncommon for objections to be raised by the government representative. Unfortunately, all too often, the government representative will tell the Contractor that he must submit a schedule showing the full contract time. Unfortunately, most schedules on government construction projects do not require a detailed critical path method schedule. Given the normal bar chart which is submitted on a construction project, it is difficult for the government representative to ascertain if the contractor has an error in his logic or an error in the estimate of his durations which result in the reduced duration for the project completion. It is for this reason that it behooves the government to require a detailed critical path method schedule preferably loaded with resources and cost. If the government representative is reviewing a detailed critical path method schedule, it is far easier for that representative to ascertain if the contract has any errors in his logic or if the contractor has omitted any activities which are critical to the project completion. Also, by requiring resource loading on the schedule, it becomes easier for the government representative to ascertain if the contractors estimates of time are accurate. For instance, if a contractor’s schedule shows that the contractor will be installing sheetrock on an entire floor of a building in three days with a crew of one foreman and two laborers, it is a relatively easy task for the government representative to take off the quantity of sheetrock which must be installed and then to calculate the productivity which that crew must demonstrate in order to meet that schedule. The government representative, however, should bear in mind that he should not reject the schedule out of hand, merely because it shows the duration less than the required contract time. Entitlement to delay costs has been upheld in situations where the contract was, in fact, completed prior to the contract completion date. In Sydney Construction Co., Inc., ASBCA No. 21,377, 77 – 2 BCA 12,719 , the contractor was found to have been delayed by seventy – five days, and based on actual performance times, it could have completed the work early, but for the government delay in approving fan coil unit shop drawings. In Sydney , this right to recover delay costs was recognized even though the government was never informed that the contractor intended to take less than the full period allowed in the contract to perform the work. See also Barton and Son Co., ASBCA No. 9477 and 9764, 65 – 2 BCA 4874 . The Armed Services Board has recognized that the Appellant must demonstrate that a realistic schedule existed for completing early. BECO Corporation, ASBCA No. 27090, 82 – 2 BCA 16,124 . In BECO, a bar chart schedule was considered sufficient. Another Board has held that an appropriate method to demonstrate an early completion date is a reasonable, appropriately prepared CPM schedule. Appeals of Montgomery – Ross – Fisher, Inc., PSBCA No. 1033, 84 – 2 BCA 17,492. The Board has also held that a contractor is not limited by the dates on its CPM schedule. In Eichof Construction Company, ASBCA No. 20,049, 77 – 1 BCA 12,398, the Board found that the showing of dates on such CPM schedules does not preclude a contractor from bettering its progress in accordance with the circumstances and its capabilities. (Referencing John J. Burke Engineering and Construction, ASBCA No. 8182, 63 BCA 3713 ). In such situations, the Eichof decision held, the government has an implied duty to cooperate and not to impede or delay the contractor’s performance. (citing CRF, a Joint Venture, ASBCA No. 18,748, 76 – 2 BCA 12,129 ; Chalender v. U.S., 127 Ct.Cl. 557 (1954) and cases cited therein). Where a contractor establishes that it would have completed the contract earlier, impact damages may be recovered for changes causing delays preventing early completion although a contract is completed on time. See, e.g., Schmid v. United States, 173 Ct. Cl. 302, 351 F.2d 651 (1965) ; L’Enfant Plaza Properties, Inc. v. United States , 3 Cl. Ct. 582, 588 (1983), aff’d and remanded , 746 F.2d 1490 (Fed. Cir. 1984) (citing Gardner Displays Co. v. United States, 171 Ct. Cl. 497, 346 F.2d 585 (1965) ) ; Manuel Bros. v. United States , 55 Fed. Cl. 8, 49 (2002), aff’d , 95 F. App’x 344 (Fed. Cir. 2004) (citing Metropolitan Paving Co. v. United States, 163 Ct. Cl. 420, 325 F.2d 241 (1963) ) . Recovery has been allowed even though the contractor never informed the government it intended to finish early. Coley Properties Corp. v. United States, 219 Ct. Cl. 227, 593 F.2d 380 (1979) . Absent a contract prohibition, a contractor has a right to better his progress and the government has an implied obligation to cooperate and not to impede or delay the contractor’s performance.
Updated: June 25, 2018