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Consequential damage waivers in construction

On Behalf of | Nov 4, 2022 | Construction Law

The agreements drafted prior to the initiating of a construction project may include a multitude of terms that cover a variety of essential topics. Many of these topics may seek to address factors such as risks and liability and being thorough with similar factors may prove integral in various ways. Construction companies in New York that wish to safeguard their interests might find it helpful to address the topic of consequential damage waivers prior to agreeing to terms for the project.

Liability and damage

When initiating operations on a project, construction companies may inherently take on a significant level of risk. Issues that prompt a need to repair or replace work rendered may lead to direct damages for the owner, but these might not be the only concerns involved. Damages that do not directly stem from the issues at hand may be deemed consequential in nature, and it may be possible to include terms within the project contract that waives liability for such damages.

While experts suggest that the difference between direct and consequential damages may be subject to interpretation at times, it may still be vital to include such terms in construction contracts.  There may also be certain standards that depict what is typically considered consequential damage and knowing what is included in these standards could prove essential. However, this topic could prove a source of contention when damages occur, and some landowners may even be hesitant to include such terms in a contract without some form of compromise.

Construction contracts

Liability for consequential damages remains a common form of dispute in the construction industry. Companies that are preparing to initiate operations on a project and wish to take every possible step to protect the well-being of their endeavors might benefit from speaking with an attorney early on for advice on everything to cover in the project contract. An attorney can provide insight on vital topics such as liability protection, help a client in New York draft contracts that align with the interests of the company, and provide assistance on the best path to take should conflict over allegations of damages arise.


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