While Parts 4 and 5 of this series explored both common and less common theories available to contractors pursuing claims against the federal government, many of which can arise in the construction context, there are more nuanced theories that often , intersect with those more familiar claims involving changes, delays, or defective specifications, presenting distinct legal and evidentiary considerations for construction contractors. Success typically depends on a contractor’s ability to develop a well-documented record demonstrating how specific government actions, omissions, representations, or superior knowledge directly caused the additional costs, delays, inefficiencies, or performance impacts for which recovery is sought. In this blog, we focus on several of these nuanced theories that frequently emerge when unforeseen site conditions, government conduct, schedule disruptions, or performance requirements materially alter the parties’ bargain, and we identify steps to mitigate impact.
Differing Site Conditions
Differing site condition claims arise when a contractor encounters physical site conditions that materially differ from what the contract indicated or from what would ordinarily be expected for the work. These claims are common in federal construction because contractors often price work based on limited pre-bid access and Government-provided drawings, boring logs, geotechnical reports, utility information, or other site-related representations. Contractors can encounter two different types of differing site conditions:
Type I: A Type I differing site condition exists when there are subsurface or latent physical conditions that materially differ from those indicated in the contract documents. For example, a contractor may rely on boring logs suggesting one soil composition but encounter materially different subsurface conditions during excavation (i.e., rock that requires additional time, equipment, manpower, and expense to remove). The key issues are whether the contract reasonably indicated the condition and whether the contractor reasonably relied on that indication.
Type II: A Type II differing site condition does not depend on a specific contract representation. It involves an unknown physical condition that is unusual, not ordinarily encountered, and materially different from what contractors would reasonably expect for the work and location. Type II claims can be harder to prove because the contractor must show that the condition was not merely unexpected, but highly unusual in context.
For both types, contemporaneous proof is critical. Contractors should preserve pre-bid assumptions, site investigation materials, photographs, daily reports, notice letters, correspondence with the contracting officer, schedule updates, and cost records. Prompt written notice is also important so the Government can investigate before the condition is disturbed or removed.
Acceleration
Acceleration claims arise when a contractor is required to complete work sooner than the adjusted schedule would otherwise permit. Directed acceleration occurs when the Government expressly instructs the contractor to increase manpower, work overtime, add shifts, resequence work, or otherwise speed up performance. Constructive acceleration commonly arises when a contractor experiences an excusable delay, requests a time extension, and the Government denies or fails to act on that request while insisting that the contractor meet the original completion date.
To preserve an acceleration claim, contractors should document the excusable delay, submit timely requests for schedule relief, and state when they are being forced to accelerate despite unresolved time impacts. It is helpful to keep accurate records, including schedules, manpower logs, overtime records, subcontractor notices, daily reports, and correspondence showing the Government knew the contractor was incurring additional costs to maintain or recover the completion date.
Compensable Excusable Delay Claims
Compensable excusable delay claims arise when a Government-caused delay extends performance and increases the contractor’s costs. Given the complex nature of construction projects, there can be many causes for delay, including delayed site access, late approvals, defective or late design information, suspension of work, failure to respond in a timely manner to issues necessary for continued performance, or other Government action or inaction. Unlike excusable non-compensable delays, such as certain unusually severe weather events, compensable delays generally require proof that the Government-caused event, rather than another cause, delayed the work.
To recover delay damages, the contractor typically must show that the Government-caused event affected the project’s critical path, the sequence of work activities that determines the completion date. A delay to non-critical work may not support a time extension or delay damages unless it ultimately affects completion. Because delay claims often involve overlapping causes, contractors must also address whether contractor-caused or other concurrent delays affect entitlement to additional time or compensation. Schedule evidence is often the backbone of these claims, including schedule updates, time-impact analyses, critical path evaluations, and a clear explanation of how the Government-caused event moved the critical path.
Where schedule impacts are significant, contractors should consider involving a qualified scheduling consultant or critical path expert early. Expert-supported time-impact analyses, periodic schedule updates, and records identifying concurrent delays can help frame the claim and tell a coherent story showing why the Government-caused event mattered to performance.
In appropriate cases, a contractor may also seek unabsorbed home-office overhead under the Eichleay formula. Eichleay damages are typically associated with Government-caused suspensions or delays that place the contractor on standby and prevent efficient reassignment of home-office resources. Contractors should be prepared to prove the delay, standby period, inability to take on replacement work, and allocable overhead.
Key Takeaways for Contractors
- Identify construction impacts early and tie them to a recognized theory, such as differing site conditions, acceleration, or compensable excusable delay.
- Provide timely written notice to the contracting officer and preserve supporting records, including pre-bid documentation, proposals and schedules, logs, site records, daily reports, time-impact analyses, and cost data.
- Evaluate critical path, concurrent delay, and potential Eichleay issues, and involve legal counsel and scheduling or critical path consultants/experts early in the process before submitting a certified claim or pursuing an appeal.
Conclusion
Construction claims are often won or lost on the quality of the contemporaneous record. Contractors that recognize issues early, document impacts in real time, and preserve their rights in writing will be better positioned to negotiate an equitable adjustment, submit a supported claim, and pursue an appeal under the Contract Disputes Act.
Visit this link to register for our upcoming webinar covering this Common and Uncommon Claims and Appeals, or view past installments in this series by clicking the links below.
- Contract Claims 101: REAs vs. Claims vs. Appeals, Part 1
- Contract Claims 101: Common Disputes and How to Best Prepare for Them, Part 2
- Contract Claims 101: Financial Fundamentals, Part 3
- Contract Claims 101: Common Theories, Part 4
- Contract Claims 101: Uncommon Theories, Part 5.
Should you have questions regarding REAs, claims, appeals, or any other government contract dispute, please contact Lauren Brier, Caitlin Trevillyan, or another member of PilieroMazza’s REAs, Claims, and Appeals or Government Contracts practice groups.
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