Evaluating Extended General Conditions
Overview
Delays in construction projects are often inevitable, and when they occur, they can trigger claims for extended general conditions from both general contractors and subcontractors. This case study illustrates how our client successfully managed such claims with the guidance of a fiduciary team experienced in construction.
The Problem: Schedule Slippage and Resulting Claims
Our client encountered significant project delays, which led to claims for extended general conditions. While the claimsThese claims required a thorough evaluation of:
Contract Schedules - Understanding the original and revised schedules, including their underlying logic.
Delays - What were the delay that impacted the schedule and why did they occur?
Relevant Contract language - What does the contract say as it relates to handling schedule delays and additional costs.
Evaluation of Requested Costs - What is the Owner being asked to pay for?
Our Solution: A Structured, Expoert-Led Review
Baseline Schedule Analysis
We began by reviewing the original project schedule to establish a baseline. This allowed us to identify deviations and assess their impact on the overall timeline.
Delay Causation Assessment
Next, we investigated the reasons behind the delays. Our goal was to determine whether the causes were within the control of the project team or due to external factors, such as weather or supply chain disruptions.
Contractual Interpretation
We carefully examined the contract documents to identify clauses related to extended general conditions. This included reviewing language around time extensions, compensation entitlements, and allowable markups.
General Contractor & Subcontractor Cost Scrutiny
At both the General Contractor and Subcontractor level, we evaluated how the proposed costs were being calculated. Leaning on our findings from the prior exercises, we had a defined duration to evaluate a claim on.
The Result: Fair Resolutions and Cost Savings
Our comprehensive review enabled our client to:
Understand the validity and scope of each claim
Negotiate fair settlements with contractors and subcontractors
Prevent inappropriate overhead and profit charges
Achieve significant cost savings while maintaining project momentum
Key Takeaway: The Value of Construction-Savvy Fiduciaries
Outcomes such as this one underline the importance of having fiduciaries with deep construction knowledge. By combining contractual insight with practical field experience, we helped our client navigate complex claims and secure equitable outcomes.