Unusually severe weather can wreak havoc on federal government projects, causing delays and driving up costs for contractors. However, under standard federal contract clauses, contractors are typically limited to time extensions rather than financial compensation for weather-related disruptions. In this blog post, our firm explores the legal framework governing such claims, key case law, and practical strategies for contractors to manage these risks effectively.
The Legal Landscape: Weather as an Act of God
Federal contracts governed by the Federal Acquisition Regulation (FAR) include clauses that allocate risks between the government and contractors. For instance, FAR 52.249-10 (Default – Fixed-Price Construction) classifies unusually severe weather as an “act of God,” an excusable delay that entitles contractors to time extensions but not additional financial compensation unless the contract explicitly states otherwise. This means contractors bear the financial burden of weather-related costs, as the government does not assume liability for these unforeseeable events.
The underlying principle is that unusually severe weather is beyond the control of either party. Contractors seeking financial relief must demonstrate that the weather was unforeseeable and that the contract explicitly allows for cost recovery, which is a challenging standard to meet under most federal agreements.
Key Case Law: No Financial Relief for Weather-Related Delays
Appeal of DTC Engineers & Constructors, LLC (2012) highlights why contractors cannot typically claim damages for unusually severe weather under federal contracts.
Appeal of DTC Engineers & Constructors, LLC (ASBCA, 2012)
In Appeal of DTC Engineers & Constructors, LLC, a contractor claimed additional costs and an equitable adjustment due to delays caused by unusually severe rainfall during a military construction project. The Armed Services Board of Contract Appeals (ASBCA) rejected the claim, referencing FAR 52.249-10, which limits relief to time extensions for excusable delays like severe weather. The board held that such weather events are acts of God, with contractors bearing the associated risks. The contractor also failed to prove that the rainfall was extraordinary compared to historical norms or that the government had assumed liability for such costs. This case reinforces the limited remedies available to contractors under standard federal contracts.
Why Claims Fail Under the Contract Disputes Act
The Contract Disputes Act (CDA) provides a framework for contractors to seek remedies for government actions or inactions that breach contractual obligations. However, claims for damages due to unusually severe weather typically fail for several reasons:
- Risk Allocation: Standard FAR clauses, such as FAR 52.249-10, assign the risk of acts of God, including severe weather, to the contractor. Without explicit provisions shifting this risk to the government, financial compensation is unavailable.
- Excusable vs. Compensable Delays: Courts and boards distinguish between excusable delays (eligible for time extensions) and compensable delays (eligible for cost recovery). Since unusually severe weather is not caused by government action, it qualifies as an excusable delay, precluding financial relief.
- Foreseeability Standard: Contractors must prove that the weather was both severe and unforeseeable compared to historical data for the project location. Even when this standard is met, compensation is not guaranteed unless the contract explicitly allows it, as seen in MK Ferguson and DTC Engineers.
Equitable adjustments for weather-related costs are rare and typically require the government to have assumed responsibility or the weather to fundamentally alter the contract’s scope, which is a high threshold that is seldom met.
Practical Strategies for Contractors
Given the limited prospects for financial recovery, contractors working on federal projects must proactively manage the risks of unusually severe weather. Our firm recommends the following strategies:
- Contract Review: Carefully analyze contract clauses, especially those addressing delays and force majeure, to understand risk allocation before signing.
- Weather Planning: Incorporate historical weather data into project schedules and budgets to anticipate and mitigate potential delays.
- Documentation: Keep detailed records of weather events and their impacts to strengthen requests for time extensions.
- Insurance: Secure insurance coverage to offset losses from severe weather, as the government is unlikely to bear these costs.
Conclusion
Under standard federal government contracts, contractors have no basis for claiming financial damages due to unusually severe weather, as established by FAR clauses and reinforced by cases like MK Ferguson Co. v. United States and Appeal of DTC Engineers & Constructors, LLC. While time extensions are available for excusable delays, financial relief is typically unavailable unless the contract explicitly provides otherwise. By understanding these legal constraints and adopting proactive risk management strategies, contractors can better navigate the challenges of weather-related disruptions in federal projects.
For assistance with government contracting issues, contact Pannier Law, P.C. at (310) 971-5093 or visit www.pannierlaw.com.
Disclaimer: * This article is provided for information purposes only. It does not constitute legal advice. It is not intended to form an attorney-client relationship. Any legal advice should be sought from an attorney. Consult a qualified attorney for advice specific to your situation. *
About the Author: William Pannier is the founder of Pannier Law, with over 20 years’ experience as a Government Contracts attorney.