What is a Construction Delay Claim?

Like trains and planes, a construction project needs to run on time. When a schedule gets delayed for a period of time, it is important for contractors, general managers, and other professional builders to document the setback with a construction delay claim. 

A construction delay claim is a formal request for compensation that is made by a contractor to a project owner when the contractor believes that they have incurred damages as a result of delays to the project.

A builder may reduce his loss if he implements Critical Path Method (CPM) scheduling in his contract provisions. This algorithm defines contingencies that occur during a building project and may grant the contractor an extension of time and avoid additional costs. By recording the situation with a construction delay claim, the contractor is protected from future contract disputes and possible litigation.

There are three main types of construction delay claims that can be classified into three categories depending on the cause of the delay:

Different Types of Construction Delay Claims

Once you’re in the middle of a set-back, you need to determine the cause of your project delay and the estimated length of time a general contractor needs to correct the situation. Claims are also divided into three categories:

1. Excusable or Inexcusable Delay Claims
2. Compensable or Non-compensable Delay Claims
3. Critical Path or Noncritical Path Delay Claims

Excusable Delay Claims vs. Inexcusable Delay Claims

The first thing you need to identify is whether the cause of your delay is excusable or inexcusable. An excusable delay is a type of force majeure, which is an unforeseeable event that interrupts the construction project timeline. An inexcusable delay claim, on the other hand, is when the contractor is at fault for the delays.

Examples of Excusable Delays

• Site conditions like Weather and natural disasters, such as heavy rain, hurricanes, earthquakes, or wildfires.
• Errors in the design of the project.
• Hindrance by a third party, such as a regulatory agency that discovers a rule violation. This could include a black-mold infestation or destruction of an endangered species’ habitat.
• The owner changes the original design.
• A dispute emerges regarding property ownership.
• Bad faith is revealed, including knowledge of a fault line on the property.
• Unforeseen hindrances e.g. during a remodel, you might uncover a rotted floor that needs to be removed and replaced.

Examples of Inexcusable Delays

• Poor quality construction that must be rebuilt affecting the project schedule.
• Slow acquisition of necessary equipment, tools, or supplies.
• Lack of supervision of workers resulting in unsafe working conditions and/or delayed labor productivity/delay damages.

The excusable vs. inexcusable determination of a claim will impact compensation made to a contractor, subcontractor, or owner.

Compensable Delay Claims vs. Non-Compensable Delay Claims

The second thing you need to identify is whether the delay is compensable or non-compensable. A compensable delay claim means that the contractor can bill the project owner for any extra time and expenses associated with the delays in project completion. A non-compensable delay claim, on the other hand, does not entitle the contractor to additional compensation from the owner regardless of the extension of time and material costs.

In order to be compensated regardless of the completion date, the contractor needs to prove that the delays were caused by an event that was beyond their control, such as poor weather conditions or a change in the design of the project. The contractor also needs to show that they took reasonable measures to avoid or mitigate the effects of the delay. If the contractor is found to be at fault for the delays, then they will not be eligible for compensation from the owner.

Critical Path Delay Claim vs. Noncritical Path Delay Claim

Compensation may often depend on the construction schedule’s final completion date stated in its CPM scheduling. The project’s management critical path’s timeline identifies each construction stage, the length of time it will take to complete, and its dependence upon the work preceding it.

A critical path delay claim is one in which the contractor proves that the delays were caused by an event that was beyond their control and that the delays will cause a ripple effect throughout the project, pushing back the completion date. A non-critical path delay claim is one where the contractor does not prove that the delays will cause a ripple effect and, as a result, the final completion date is not pushed back.

Smart professionals insert extra “float” time into every phase of their critical path to allow for contingencies. In one scenario, a builder might be slated to lay a foundation by August 1 but will schedule an additional 20 days of float time. Despite setbacks, if a contractor remains within the CPM’s allotted time, it is still considered an uncritical delay because it does not exceed the final completion date.

However, if one obstruction or a succession of delays has a cumulative impact on the final completion date, the client may face lost profit due to extra interest payments, higher insurance premiums, loss of rental income, and other streams of revenue. When a project enters this critical period, a contractor may owe compensable costs to the client.

How Electronic Options Can Expedite Construction Delay Claims

Prompt filing of a construction delay claim is important throughout the build. It’s not a time to be slowed down by paperwork and difficult calculations. If a builder needs to notify his construction partners, including his client, bank, inspector, or architect, timing is crucial. If this delay is not addressed in a timely manner, it could damage a builder’s reputation, sabotage your credit, or impact future work acquisition. A digital platform with an easy-to-use construction project management app can save a contractor precious time.

Don’t be intimidated by electronic options. People often learn a new app on a mobile device over a coffee break or lunch hour. A template for a construction delay claim will include contact info and a description of the problem. The drag-and-drop feature of the affordable GoCanvas’ construction templates allows you to expound on the reason for the slow-down, outline options to correct the issue, and estimate additional time and cost. GoCanvas apps have the capacity to capture signatures, edit submissions, and dispatch data. They also have options to capture images and provide API service that puts full research tools at your fingertips. This documentation will ultimately help when making decisions regarding who is at fault, who can be compensated and when the status becomes critical.

Construction Delay Claim Forms Available with GoCanvas Apps

GoCanvas has created a full collection of construction apps that are designed to expedite the challenging demands of a building project. Records of your construction progress can also help you plan future projects.

Delay Notice Construction Forms for Contractors

Excellent for documentation and reference, this app outlines potential solutions to get a project back on track.

Construction Project Notification of Dela

This straightforward app summarizes any delay situation with relevant fields.

Memorandum of Delay Construction Forms for Contractors

With a focus on compliance, this app helps you report a delay in a project. Working with timelines, this app follows the effect on the scope of work.

GoCanvas designs easy-to-use apps for busy professionals. These apps work with you to digitalize your office and reduce your paper load. The Application Store also features apps that help you streamline and track Project Implementation, Inspections, and Work. Contact us today to learn more.

Increase Contract Wins with Digitalized Job Bidding Template Apps

What is a Construction Bid? 

Professionals in the construction business often have to submit construction bid forms to clients planning to build or remodel residential, commercial or institutional structures. Job bidding proposals may vary, but they often have three primary sections.

• A Line Item Sheet that lists each expenditure and its projected cost
• A Scope of Work document that fleshes out each line item
• A legally-binding Construction Contract that states your terms

Job bidding by professionals such as contractors, plumbers, construction workers, remodelers, dispatchers and roofers can be very competitive, and it’s advantageous to implement helpful digital tools to gain an advantage over your competitors.

What is a Construction Bid Form Template?

A construction bid form template is an app that streamlines and digitalizes the process of creating a construction bid. It is a document or file used as a guide to fill in all the essential information needed for a construction bid proposal.

There are several  benefits of using a digital construction bid form template, but the three most important ones are:

• You can quickly and easily create a professional-looking construction bid.
• You can share the document with other people involved in the project, such as the architect, engineers, and clients.
• You can save time by having all the information you need in one place.

What to Include in a Construction Bid Form Template 

Line Item Sheet

The Line Item spreadsheet includes every element associated with the build. Items may include permit costs, lumber, excavating, cleaning, plumbing, doors, trim, drywall labor, brickwork, electrical installation, finish labor and flooring wood. A site visit, accurate measurements and attention to detail will enhance this document.

The most difficult part of the job bid may be predicting the cost estimate of each line item. Since prices can fluctuate over time, a bidder should never work from old data. While reviewing current prices, the project management team needs to calculate their profit margin and waste percentage. A smart bidder will study a wide range of variants that occur with regards to the location and time period of the build.

An extreme weather event in any part of the country might affect the nationwide price and supply of materials.

• Consider the cost of materials and labor in your immediate locale. Prices can vary throughout a state or region.
• Consider the season in which you are building. Will you be delayed by storms, snow, and rain?

If you bid too high on a project, you might lose the bid. But if you bid too low, you may not cover your costs, and it may indicate that you don’t understand the scope of the project. Finding the delicate balance between these two extremes is enhanced by experience and good recordkeeping.

When a construction professional first enters the business, he might want to consider a Labor Only contract to avoid the calculation of supplying materials. As with all contracts, be specific with cost delegation. For example, the client may agree to supply the lumber for a project, but not include the cost of nails, adhesives, disposal of materials and other general costs incurred.

Scope of Work Document

The Scope of Work document lets you expound on the Line Item List. It will break down how many faucets and doorknobs you may need to complete a project. While a template is useful here, it’s important to personalize the form so it doesn’t look like a standard presentation. The client wants to know you put thought and consideration into your proposal.

A Scope of Work document typically contains:

• An Explanation of Costs of particular items
• Timelines that show each stage of the project
• Terms of Payment states when and how you’ll be paid
• Signature lines for all involved parties

Make sure to speak your client’s terminology in the document. The reader wants to see themself in your proposal. With that in mind, make sure your client is comfortable with terms like load-bearing wall, drywall, floor plan, and field measure. 

Construction Bid Form Contract

The Construction Bid Form is a contract that is a legally binding agreement stating the responsibilities of the bidder while protecting them from unnecessary liability. Damage from extreme weather is often a contentious part of a contract. Legal professionals recommend that a Delay Damages clause be included in a contract.

Job bidders tend to guard against surveying by competitors, by making their bid negotiations covert. At the same time, a construction project is a dynamic process with lots of moving parts, so it’s helpful to have input from trusted sources of expertise. While it’s important to hold your bid close to your chest, make sure at least one other person reviews your bid for accuracy and enhancement.

The Advantages of Using a Digital Construction Bid Form Template 

Digital templates can be helpful when you’re writing a bid contract. The trick is to customize them to present a personalized package. Paper forms can slow you down and allow another bidder to swoop in and walk away with the job. When you choose to use a construction bid form app, you can expect

• Faster and more accurate bids
• Better clarity and communication with clients, co-workers and subcontractors
• Elimination of paperwork in the field and your office

Paperless is Faster and Will Make You More Competitive

A paperless, digital job bidding template app quickly calculates and estimates a bid ahead of paper-laden competitors. Without needing access to reams of paper, the app can pull material lists and labor rates to quickly and accurately complete the bid – right from the location.

A high-functioning construction app also has the flexibility to customize a bid, calculate costs, edit submissions (the PDF the client receives), capture images to document work, and can be shared in real-time, which can speed up a bid for a project. Once you’ve downloaded the GoCanvas app, it’s simple to drag and drop the fields you need to customize your forms. GoCanvas also has effective sharing and storing options:

• Convert data captured to a PDF document and forward to the client or supervisor
• Download to Excel
• Export to your accounting or other software

Meeting the Needs of Construction Companies with Our Estimate Template Mobile App

GoCanvas offers a number of Job Bidding Templates:

• Designed for fast-moving handyman services, the Handyman Bid Mobile App makes it easy to store the details of the job and calculate a quick job estimate.
• The Bid Template proposal app is designed for versatility. It calculates labor costs, stores plan dates, job information, and budget.
• The Plumbing Work Bid calculates materials, time, fees and labor costs to create a comprehensive project bid.
• The Roofing Bid Proposal balances all the tricky components of a roofing project, including the type of roofing, proposed project, and terms and conditions.
• The Remodeling Bid Proposal Form keeps track of all the specs for a construction project bid for submission to a competitive bidding or open bid process. Just some of the details include taxes, permits, tax-exempt status, other construction bid details, and more.

Convenient contractor job bidding form apps help you grow your business. Once your bid is secured, you can digitalize other paper-based processes including Project Implementation, Inspections, Work Orders and more. To learn more about how you can use GoCanvas for your business, contact us today!