Source: https://www.nhconstructionlaw.com/blog/archives/05-2020
Timestamp: 2020-07-02 22:57:43
Document Index: 500729616

Matched Legal Cases: ['§ 10', '§ 10', '§ 10', '§ 10', '§ 10', '§ 8']

#89: COVID-19 as a “Hazardous Substance” Justifying Delay or Suspension
For everyone’s protection, construction contracts often contain provisions for suspending work when a hazardous substance is encountered at a job site, with companion clauses governing extensions of time and extra compensation. The AIA’s popular A201 General Conditions (2017), for example, contains these provisions:
§ 10.3.1 If the Contractor encounters a hazardous material or substance not addressed in the Contract Documents and if reasonable precautions will be inadequate to prevent foreseeable bodily injury or death to persons resulting from a material or substance, including but not limited to asbestos or polychlorinated biphenyl (PCB), encountered on the site by the Contractor, the Contractor shall, upon recognizing the condition, immediately stop Work in the affected area and notify the Owner and Architect of the condition.
§ 10.3.2 Upon receipt of the Contractor’s notice, the Owner shall obtain the services of a licensed laboratory to verify the presence or absence of the material or substance reported by the Contractor and, in the event such material or substance is found to be present, to cause it to be rendered harmless. . . . When the material or substance has been rendered harmless, Work in the affected area shall resume upon written agreement of the Owner and Contractor. By Change Order, the Contract Time shall be extended appropriately and the Contract Sum shall be increased by the amount of the Contractor’s reasonable additional costs of shutdown, delay, and start-up.
§ 10.3.4 The Owner shall not be responsible under this Section 10.3 for hazardous materials or substances the Contractor brings to the site unless such materials or substances are required by the Contract Documents.
Is COVID-19 a “hazardous material or substance” within the meaning of this language? You won’t find it on EPA’s comprehensive list of hazardous substances. An infectious disease transmitted by human hosts is certainly not the type of “substance” one would normally think of as included, although scientists tell us that the virus can survive on hard surfaces such as metal or plastic for several days. The contractual provision for testing is also a poor fit; as a practical matter nobody is going to test the site for the presence of COVID-19 when it is cheaper and easier simply to disinfect.
Even if COVID-19 counts as a hazardous substance, the next question is whether “reasonable precautions will be inadequate to prevent foreseeable bodily injury or death to persons.” OSHA’s issuance of COVID-19 Guidance for the Construction Workforce tends to suggest that reasonable precautions will be adequate.
Then there is the difficulty of figuring out who introduced the virus into the site. Under § 10.3.4, the Owner is not responsible if the Contractor’s workforce brought it to the project – and in cases of new construction where the Contractor had sole possession of the site, proving otherwise will be almost impossible. Indeed, even raising the subject is risky business; if it turns out that the Contractor introduced the virus to the site, it would be liable under § 10.3.5 to “reimburse the Owner for the cost and expense the Owner incurs (1) for remediation of hazardous materials or substances the Contractor brings to the site.”
All things considered, premising a unilateral suspension of a project on the presence of the virus as a hazardous substance is a poor strategy. The better course is to try for an extension of time under § 8.3.1: “If the Contractor is delayed at any time in the commencement or progress of the Work . . . (3) by labor disputes, fire, unusual delay in deliveries, unavoidable casualties, adverse weather conditions documented in accordance with Section 15.1.6.2, or other causes beyond the Contractor’s control; . . . or (5) by other causes that the Contractor asserts, and the Architect determines, justify delay, then the Contract Time shall be extended for such reasonable time as the Architect may determine.” With many construction workers nervous about returning to work in close quarters – and particularly if a few have tested positive on their crews – manpower issues as excuses for delay will commend themselves to the sensibilities of all but the most jaded Architects.