TERTIARY CO2 RECOVERY UNIT; TEXAS
Construction Contract Dispute
The project in question was a grass roots tertiary CO2 recovery unit in Texas. The dispute between the mechanical contractor and the plant owner arose during the job when the contractor’s labor productivity began to suffer and costs increased, and the contractor submitted a Request for Equitable Adjustment (REA).
Contractor’s Entitlement – Construction Claim
The primary issue between the parties was whether the contractor suffered compensable craft labor productivity losses due to owner design changes and change orders, or whether the productivity losses resulted from non-compensable contractor bid errors and performance problems.
We found that under the circumstances of this case, while factors such as change orders caused some craft labor productivity losses, most of these losses resulted from contractor-caused problems.
The client achieved a very favorable settlement prior to the dispute developing into litigation.