Government Contracting Database
Increased Material Costs
A contractor may recover for an increase in material costs where its performance is extended as a result of owner-caused delays. J.D. Hedin Constr. Co. v. United States, 347 F.2d 235 (Ct. C1. 1965); Canon Constr. Corp., ASBCA No. 16142, 72-1 BCA ¶ 9,404; Berkeley Constr. Co., VABCA No. 1962, 88-1 BCA ¶ 20,259. In order to recover, the contractor must show that the material could not have been purchased earlier. Paccon, Inc., ASBCA No. 7890, 65-2 BCA ¶ 4,996. Once justified, material escalation costs are calculated in a manner similar to labor escalation costs.
Updated: August 2, 2018