Implied Warranty – Implied Warranty to Coordinate Other Contractors

Although rarely stated as such in the contract documents, the owner does have a broad series of contractual responsibilities. The owner’s failure to adequately execute these responsibilities can produce a recoverable claim.

This is the third blog post in a series that provides awareness of the following implied warranties in construction contracts. The previous blog posts discussed the implied warranty that the plans and specifications are sufficient and adequate for the purpose intended and the implied warranty that neither party to a contract will do anything to prevent performance thereof by the other party, or that will hinder or delay the other party in its performance.

This final blog post discusses the implied warranty that, on multi-prime projects, the owner or construction manager will coordinate the activities of the respective contractors so as to avoid disruptions.

There exists an implied obligation to supervise and coordinate the work of other contractors and to prevent interferences by such contractors on other contractors. Key terms associated with this issue include failure to coordinate, interference by other contractors, poor project management, congested work areas, stacking of trades, inadequate sequencing of primes, schedule overlaps, restricted access, lack of direction, and held up by others.

This obligation extends from the owner on a multi-prime project, or from the general contractor to its subcontractors. Orderly progress of the work depends on the careful coordination of all prime contractors and subcontractors. Problems arise when sequencing is not carefully planned. Recovering added costs or getting a time extension depends on whether the owner, the construction manager, or a contractor had the contractual responsibility for coordinating the work.

Personnel should be aware of the problems inherent in coordinating a project. Failure to effectively coordinate may have a “domino effect” on other trades. Voluntary assumption of the responsibility for coordinating, where none exists in the contract, is risky and may expose a contractor to liability.
This warranty to coordinate has been recognized in numerous cases, some of which are identified below:

• Failure to compel cooperation among contractors¹

• Failure to prevent deliberate interference from other contractors under the owner’s control²

• Failure to provide jobsite coordination³

• Breaching a contract by failing to expedite work on an adjacent project⁴

In another case, L.L. Hall Construction Company,⁵ a dispute arose as to the government’s responsibility to supervise and coordinate other contractors working on the construction site. There, as is found in the typical federal construction contract, the government reserved the right to suspend or change operations. During the project, because of the inefficient operations of two other contractors, the government suspended the plaintiff’s operations and allowed the other work to proceed. The court held that the government had no right to shut down the plaintiff’s efficient operations in favor of the inefficient contractors and that in doing so it had breached its implied obligation not to delay the blameless contractor. Moreover, the court further held that the government had the affirmative obligation to prevent any interference by the other contractors.

¹    Shea-S&M Ball v. Massman-Kiewit-Early, 606 F.2d 1245 (D.C. Cir. 1979).

²    Felhaber Corporation v. New York, 410 N.Y.S. 2d 920, 924, 927 (App. Div. 1978).

³   Forest Electric Corporation v. New York, 275 N.Y.S.2d 917 (Ct. Cl. 1966).

⁴    Town & Country Eng’g Corp. v. State, 46 N.Y.S.2d 792 (Ct. Cl. 1944).

⁵   L. L. Hall Construction Company v. United States, 379 F.2d 559, 564 (Ct. Cl. 1966).

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