personal protective equipment including masks.⁸ Construction projects took more time to complete, and were more costly to complete, than anticipated at the time of contracting.⁹

Contributing significantly to construction delays and increased costs were widespread supply chain disruptions that arose contemporaneously with the COVID-19 pandemic.¹⁰ Shortages of construction materials and other supplies were attributed to a variety of factors, including manufacturers and transporters dealing with the same shutdown orders, staffing shortages, and other productivity issues that impacted construction projects. Construction materials and other supplies became significantly more expensive and took significantly longer to be delivered than anticipated at the time of contracting. Contractors who had entered into fixed-price construction contracts with strict completion deadlines sought relief from the consequences of these unanticipated delays and price increases.

Transportation construction projects suffered unique impacts as a result of COVID-19. State DOTs suffered from a loss of revenue including fuel taxes and tolls intended to help pay for the projects. The dramatically reduced usage of transportation facilities, resulting from closed workplaces and individuals sheltering at home, called into question the need for some transportation improvement projects. These factors, along with the prospect of increased costs of construction (or increased claims from contractors facing increased costs of construction) resulted in some state DOTs considering whether projects should be canceled or at least put on hold. On the other hand, “the lower traffic volumes mean faster delivery of materials and longer lane closures, which leads to an overall efficient execution of construction projects,” partially offsetting some of the delays discussed above.¹¹ Further, Congress provided monetary relief to state DOTs to address pandemic-related revenue declines,¹² and contractors facing increased construction costs were also eligible for federal monetary relief through pandemic programs such as the Paycheck Protection Program (PPP). The impact of the COVID-19 pandemic on transportation and infrastructure construction was complex.

In short, the COVID-19 pandemic highlighted the unique impact of force majeure events on “contracts for public infrastructure projects, such as roads, highways, and bridges”:¹³

This report examines the legal impact of extremely unusual circumstances, such as the COVID-19 pandemic, on contracts with state DOTs and other transportation agencies. The following Section II provides a general overview of the force majeure legal environment, including common law doctrines as well as statutory and contract provisions applicable to force majeure circumstances such as pandemics. Section III focuses on the specific legal and contractual provisions applicable to projects for state DOTs and other transportation agencies, and the resulting allocation of legal and financial risk of pandemics and other force majeure circumstances as between the transportation agency and its contractor. Section III covers remedies available to the contractor (such as the contractor’s potential entitlement to a time extension and/or price adjustment) and remedies available to the state DOT (such as project suspension and/or termination) in the event of a pandemic, and potential defenses that either party may raise to the other party’s declaration of force majeure. Examples of contracting legal disputes arising out of pandemics are provided in Section IV.

A state-by-state summary of force majeure provisions in state DOT standard specifications is contained in Appendix A. Appendix B contains a survey questionnaire that was delivered to all fifty state DOTs as part of this research project in order to determine the impact of the COVID-19 pandemic on their contracts. Twenty-eight of fifty states (56%) provided complete responses to the survey. The results are discussed herein.

II. OVERVIEW OF FORCE MAJEURE AND UNANTICIPATED CIRCUMSTANCES

Contracting parties should consider their legal and contractual rights and obligations when contract performance is impacted by unanticipated circumstances outside their control (commonly known as force majeure circumstances or “acts of God”). The concept of force majeure is often invoked by a contracting party seeking to be excused from strict compliance with its contractual obligations, where contract performance is hindered by unanticipated external conditions that are not the fault of a contracting party. While the contract will often contain an

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⁸ AbdulLateef Olanrewaju, Paul Junior Anavhe & Hui Chen Chu, Disputes and Claim Management during the COVID-19 Crisis: The Lessons Learned, 15 J. LEGAL AFF. & DISP. RESOL. ENGINEERING & CONSTRUCTION, 1, at 04522054-1 (Feb. 2023) (“Various measures, such as contact tracing, masking, isolation, and social distancing, have been implemented to flatten the curve.”).

⁹ Salami et al., supra note 5, at 1203 (“The Covid-19 climate has pushed many construction firms to the edge, making re-evaluation of contractual terms and conditions imperative in a bid to adjust to the prevailing economic realities.”).

¹⁰ Charlson, supra note 3, at 06522002-1 (describing adverse “impacts of the COVID-19 pandemic on the U.S. construction industry . . . including significant delays on projects, inability to secure materials on time, reduction in productivity rates and material, and price escalations”); Herrmann, supra note 6, at 04523008-1 (describing COVID-19 construction delays caused by “supply chain issues (including but not limited to availability of raw materials, delays in manufacturing, and delays in shipping)”).

¹¹ Osman & Ataei, supra note 7, at 06521004-4.

¹² Id.

¹³ Noetzel, supra note 1, at 1363.

¹⁴ Id. (internal citations omitted).

express force majeure provision, there may also be statutory or common law remedies available to the contracting party seeking relief.

A. Common Law Doctrines

1. Impossibility

Historically, contract obligations were strictly construed under the doctrine of “sanctity of contracts,”¹⁵ requiring performance of contract obligations even in the face of unforeseen circumstances. In the context of construction contracts, that meant that a contractor was liable to the project owner for economic damages resulting from failure to strictly perform according to the contract specifications, or failure to substantially complete performance within the time provided in the contract, regardless of the reason for failure to perform.¹⁶ Practically the only exception, widely recognized in the 19^th century, was where contract performance was “rendered impossible by the act of God, the law, or the other party.”¹⁷ “No hardship, no unforeseen hindrance, no difficulty short of absolute impossibility,” would excuse a construction contractor from timely completing its contract obligations.¹⁸ Contractors were expected to factor such hardships and hindrances into their contract prices, and to perform the contract work until performance became actually impossible.¹⁹

Contractors defending nonperformance on the ground of impossibility had a high standard to meet.²⁰ Courts generally would not excuse performance unless it was physically impossible,²¹ due to circumstances that were unforeseen at the time of contracting,²² and such failure to perform was outside the contractor’s control.²³ In order to be excused, performance must have been objectively impossible:²⁴ It was not sufficient that a given contractor found performance impossible (i.e., subjectively impossible), but rather performance was excused only if it would have been impossible for any similarly situated contractor in the industry to perform the contract.²⁵ Accordingly, performance was not excused merely because the contractor’s cost of performance increased dramatically (e.g., due to material price increases), as performance remained possible, albeit at higher cost.²⁶ This very high standard to excuse performance evolved somewhat over time, as courts in the twentieth century found reasons to excuse performance due to intervening events and circumstances even when performance was not absolutely impossible,²⁷ giving rise to the modern doctrine of commercial impracticability discussed in the following Section II.A.2.²⁸

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¹⁵ Dermott v. Jones, 69 U.S. 1, 7, 17 L. Ed. 762 (1864) (holding that construction contractor was not excused due to differing site conditions from strict performance of its contract obligations).

¹⁶ Herrmann, supra note 6, at 04523008-2 (“In the context of construction, that would mean if a contractor completes a project after the date agreed upon in the contract, the contractor has breached the contract and is automatically deemed liable.”).

¹⁷ Dermott v. Jones, 69 U.S. 1, 7, 17 L. Ed. 762 (1864) (emphasis supplied); see also Stees v. Leonard, 20 Minn. 494, 451 (1874) (“If a man bind himself, by a positive, express contract, to do an act in itself possible, he must perform his engagement, unless prevented by the act of God, the law, or the other party to the contract.” (emphasis supplied)); Jennifer Sniffen, In the Wake of the Storm: Nonperformance of Contract Obligations Resulting from a Natural Disaster, 31 NOVA L. REV. 551, 564 (2007) (“Events outside one’s control might include acts of God, sudden illness, fire, theft, natural disasters, or other situations where parties cannot take actions to protect themselves from risk.” (emphasis supplied)).

¹⁸ Stees v. Leonard, 20 Minn. 494, 451 (1874).

¹⁹ Id.; see also Sniffen, supra note 17, at 564 (“Fortuitous events will only relieve a party of its obligations under a contract when performance of those obligations is actually impossible.”).

²⁰ Aaron P. Silberman, How State and Local Public Agencies May (or May Not) Terminate Construction Contracts, 36 CONSTRUCTION LAWYER, 2, at 16, 19 (Spring 2016) (noting that impossibility is “is very difficult for a contractor to prove”).

²¹ Amy Sparrow Phelps, Contract Fixer Upper: Addressing the Inadequacy of the Force Majeure Doctrine in Providing Relief for Nonperformance in the Wake of the COVID-19 Pandemic, 66 VILL. L. REV. 647, 673 (2021) (“A potential common law defense to raise in response to COVID-19 is the impossibility defense, which requires physical impossibility to excuse performance.”).

²² William C. Hennings, Sarah A. Abdellatif & Awad S. Hanna, Proper Risk Allocation: Force Majeure Clause, 14 J. LEGAL AFF. & DISP. RESOL. ENGINEERING & CONSTRUCTION, 1, at 04521048-4 (Feb. 2022) (“The impossibility doctrine assumes that both parties will be able to perform as originally contemplated at the inception of the contract.”); see also Massachusetts Bay Transp. Auth. v. United States, 254 F.3d 1367, 1372, 1374 (Fed. Cir. 2001) (citing United States v. Winstar Corp., 518 U.S. 839, 904, 116 S. Ct. 2432, 135 L.Ed.2d 964 (1996)).

²³ United States v. Winstar Corp., 518 U.S. 839, 904, 116 S. Ct. 2432, 2469, 135 L. Ed. 2d 964 (1996) (observing “the traditional blanket rule that a contracting party may not obtain discharge if its own act rendered performance impossible”).

²⁴ McGeehin & Spangler, supra note 4, at 19 (“If a breach of contract occurs, the breaching party is liable for the resulting damages to the counterparty unless performance was rendered objectively impossible due to some intervening event.”); Sniffen, supra note 17, at 562 (“When a party’s performance is objectively impossible, it literally cannot perform due to circumstances beyond its control.”).

²⁵ Herrmann, supra note 6, at 04523008-2 (citing Seaboard Lumber Co. v. United States, 308 F.3d 1283, 1294 (Fed. Cir. 2002)).

²⁶ See, e.g., Seaboard Lumber Co. v. United States, 41 Fed. Cl. 401, 417 (1998) (“The market fluctuation did not make [contractor]’s performance impossible, merely uneconomical. Thus contract performance was not objectively impossible . . ..”), aff’d, 308 F.3d 1283 (Fed. Cir. 2002).

²⁷ 5 PHILIP L. BRUNER & PATRICK J. O’CONNOR, JR., BRUNER AND O’CONNER ON CONSTRUCTION LAW § 15:28 (2002) (“Over time, the doctrine of actual impossibility was liberalized under the influence of the commercial world to recognize that contractual performance could be rendered impossible, as a practical matter, if the contract could only be performed at an excessive or unreasonable cost under circumstances well beyond the contemplation of the parties when they entered into the contract.”); see also McGeehin & Spangler, supra note 4, at 19 (“Impossibility of performance is a high standard to meet, and, over time, courts have recognized the appropriateness of providing some relief for contractual nonperformance caused by events or effects that are unanticipated and make performance more difficult, even if performance is not rendered objectively impossible.”).

²⁸ William Cary Wright, Force Majeure Delays, 26 CONSTRUCTION LAWYER, 4, at 33 (Fall 2006) [hereinafter Wright, Force Majeure Delays] (“The doctrine of force majeure has developed, generally, from ‘physical impossibility’ to ‘frustration of purpose’ and more recently to ‘commercial impracticability.’”).

Although impossibility was a legal defense under the common law, force majeure statutes in civil law jurisdictions often imposed a similar standard well into the twentieth century, excusing performance only when an “act of God” or other unforeseen circumstance rendered performance effectively impossible.²⁹ Likewise, force majeure clauses in construction contracts in the early twentieth century were often an express adoption of the common law doctrine of impossibility.³⁰ Viewed in this light, the phrase “acts of God” used in many contractual force majeure provisions might be read to mean an external event or circumstance that does not just make performance more difficult, but actually makes performance impossible (at least, impossible to perform within the time provided in the contract).³¹ However, most contractual force majeure provisions today will excuse performance for a standard lower than impossibility.³²

Although there may be few contemporary cases addressing impossibility, due to the evolution of doctrines with lower standards for nonperformance, there remains a large body of precedential case law on impossibility.³³ In the event of a pandemic, parties to a construction contract might consider the application of the impossibility doctrine, especially where the contract does not contain an express force majeure provision.³⁴ In the early days of the COVID-19 pandemic, courts were generally willing to apply the impossibility doctrine to excuse performance when acts of government (such as stay-at-home orders) made performance impossible.³⁵ However, when performance was not truly impossible, but rather “occasioned only by financial difficulty or economic hardship” as a result of the COVID-19 pandemic, courts would generally not excuse performance.³⁶

2. Impracticability

Around the turn of the twentieth century, courts began to excuse contract performance not just when it was actually impossible, but also when it was “practically impossible.”³⁷ This came to be known as the defense of impracticability (as opposed to impossibility).³⁸ For a contracting party to be excused of its contract obligations under this doctrine, performance must have become “impracticable without his fault by the occurrence of an event, the non-occurrence of which was a basic assumption under which the contract was made, . . . unless the language or the circumstances indicate the contrary.”³⁹ Under the doctrine of impracticability, strict performance of the contract requirements could be excused for a broader range of circumstances than under the impossibility doctrine, including for reasons such as differing site conditions.⁴⁰ In the construction context, this was often less than a full discharge of the contractor’s responsibilities, and instead often resulted in an effective extension of the contract performance deadline.

Perhaps the most significant contribution of the impracticability doctrine is the defense of commercial impracticability, where a contracting party may be excused where performance becomes commercially or economically senseless.⁴¹ This defense might be invoked by contractors in the event of extreme market price increases, such as where the cost of a critical supply becomes ten times more expensive after the contract is executed.⁴² However, it is often unclear just what magnitude of price in-

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²⁹ A. Samer Ezeldin & Amr Abu Helw, Proposed Force Majeure Clause for Construction Contracts under Civil and Common Laws, 10 J. LEGAL AFF. & DISP. RESOL. ENGINEERING & CONSTRUCTION, 3, at 04518005-2 (Aug. 2018).

³⁰ Phelps, supra note 21, at 652 (“The English law concept of force majeure developed out of the common law doctrine of impossibility, and has evolved over time.” (citing P.J.M. Declercq, Modern Analysis of the Legal Effect of Force Majeure Clauses in Situations of Commercial Impracticability, 15 J. L. & COM. 213, 214 (1995) (“The concept of force majeure has developed over the years. It started off as a contractual synonym for the general common law doctrine of (physical) impossibility.”))).

³¹ See, e.g., Ezeldin & Helw, supra note 29, at 04518005-6 (suggesting that the “definition of force majeure has to take into consideration the partial impossibility of performance” as well as “full impossibility of performance”).

³² Id. at 04518005-7 (“[S]ome clauses do not state that the performance has to be impossible. Instead, such clauses only state that the performance is prevented, delayed, adversely affected, or hindered.”).

³³ Osman & Ataei, supra note 7, at 06521004-2 (“If the parties failed to include force majeure clauses in their contracts, several common law doctrines [including impossibility] also excuse parties from performance when force majeure events occur.”).

³⁴ Salami et al., supra note 5, at 1202 (“[C]ontracts without the force majeure clause can still argue that the outbreak of Covid-19 made performance impossible. This is dependent on the relevant governing laws and the relationship between the failure to perform and Covid-19 pandemic.”).

³⁵ Phelps, supra note 21, at 659 (“Early COVID-19 ligation shows that courts are willing to apply the impossibility doctrine to excuse nonperformance.”).

³⁶ Id. at 660.

³⁷ See, e.g., United States v. Weisberger, 206 F. 641, 645 (9th Cir. 1913); Blodgett v. Nw. El. R. Co., 80 F. 601, 603 (7th Cir. 1897); Waite v. O’Neil, 76 F. 408, 410 (6th Cir. 1896); see also 5 PHILIP L. BRUNER & PATRICK J. O’CONNOR, JR., BRUNER AND O’CONNER ON CONSTRUCTION LAW § 15:28 (2022) (“Over time, the doctrine of actual impossibility was liberalized under the influence of the commercial world to recognize that contractual performance could be rendered impossible, as a practical matter, if the contract could only be performed at an excessive or unreasonable cost under circumstances well beyond the contemplation of the parties when they entered into the contract.”).

³⁸ 5 PHILIP L. BRUNER & PATRICK J. O’CONNOR, JR., BRUNER AND O’CONNER ON CONSTRUCTION LAW § 15:22 (2002) (“[B]y the early 20th century: . . . the doctrine of strict and absolute impossibility had given way to the modern principle of impracticability . . ..”).

³⁹ RESTATEMENT (SECOND) OF CONTRACTS § 261 (1981).

⁴⁰ See, e.g., Mineral Park Land Co. v. Howard, 156 P. 458, 460, 172 Cal. 289, 293 (1916) (excusing bridge contractor’s performance of borrow excavation contract “where the difference in cost is so great as here, and has the effect, as found, of making performance impracticable, the situation is not different from that of a total absence of earth and gravel.”).

⁴¹ Wright, Force Majeure Delays, supra note 28, at 33 (“In the case of commercial impracticability, performance is still possible, and the purpose of the contract can still be fulfilled. Due to changes in circumstances, however, the performance of the promisor’s obligations has become economically senseless.”).

⁴² See, e.g., Mineral Park Land Co. v. Howard, 156 P. 458, 459, 172 Cal. 289, 291 (1916) (excusing bridge contractor’s performance of borrow excavation contract as impracticable where “any greater amount

crease is required to trigger commercial impracticability.⁴³ Ordinary market price fluctuations are not sufficient to render performance commercially impracticable, as contracts are rarely executed on the assumption that ordinary market price fluctuations will not occur.⁴⁴ Further, there is some authority that, in the context of fixed-price public construction contracts, the risk of even very large material price increases is allocated to the contractor, making the defense of commercial impracticability unavailable.⁴⁵

Despite having broader application than the doctrine of impossibility, commercial impracticability is likewise subject to a high standard. One reason for this is that if it is truly commercially or economically senseless to continue performance, that condition is probably not remedied by a mere time extension, and termination of the contract might be the only way to provide relief for the party seeking to avoid its contract obligations.⁴⁶

Modern day force majeure provisions in construction contracts tend to closely replicate the common law doctrine of impracticability.⁴⁷ Typically, the force majeure provision will excuse strict performance in the event of a broader range of events and circumstances than merely where performance is impossible. Further, the force majeure provision typically favors the extension of contract deadlines over contract termination. The force majeure provision may expressly require the contractor to continue performing to the extent “practicable” upon the occurrence of a force majeure event.⁴⁸

Because the doctrine of impracticability only applies in the event of an occurrence that was not contemplated nor the risk allocated by the contract, the defense of impracticability can rarely be raised where there is a contract provision that expressly provides for the occurrence.⁴⁹ Because force majeure provisions often expressly provide a time extension for pandemic-related circumstances, such as epidemics or quarantines, a contractor would rarely be able to obtain additional relief (such as a complete discharge of contract responsibilities) based on the common law doctrine of impracticability. Contractors seeking relief on the ground of commercial impracticability due to supply chain disruptions arising out of the COVID-19 pandemic were generally unsuccessful,⁵⁰ as courts concluded either that the contractor failed to prove that the risk of material price increases were not allocated to the contractor, or failed to prove that the contractor’s material prices had increased to the threshold required for commercial impracticability.

3. Other Doctrines

Courts may use terminology other than impossibility or impracticability to excuse contract performance due to unforeseen circumstances outside the control of the contracting parties.

Under the doctrine of frustration of purpose, a party may be excused from continuing to perform under a contract if, as a result of an occurrence that was not reasonably foreseeable and outside the control of that party, “the value of counter performance is totally or nearly totally destroyed.”⁵¹ For example, if a property owner contracted to construct a facility for purposes of hosting an event, and the event was later required to be canceled due to an unforeseen pandemic, the owner might seek to terminate the contract on the basis that the owner’s original purpose was frustrated. On the other hand, if the facility to be constructed could still be used by the owner for other purposes notwithstanding the pandemic, the contractor might argue that it is entitled to monetary damages for the owner’s breach of the contract. Frustration of purpose does not apply simply because the party regrets its bargain (e.g., due to unanticipated increases in the cost of performance) because the party’s contracting purpose is not frustrated (i.e., it is still entitled to receive the compensation for which it bargained).

Under the doctrine of mutual mistake, a party may be excused from continuing to perform under a contract if both parties were mistaken as to a basic assumption of the contract at the time of contracting.⁵² For the doctrine of mutual mistake to apply, the mistake made by the parties typically must relate to facts existing at the time of contracting, rather than a failure of the parties to predict what might happen in the future.⁵³ For example, a pandemic that impacts contract performance would

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could have been taken only at a prohibitive cost, that is, at an expense of 10 or 12 times as much as the usual cost per yard”).

⁴³ Patrick J. O’Connor, Allocating Risks of Terrorism and Pandemic Pestilence: Force Majeure for an Unfriendly World, 23 CONSTRUCTION LAWYER, 4, at 5, 11 (Fall 2003) (“Obviously, on a major infrastructure project or even a relatively modest construction project, costs do not need to increase ‘tenfold’ before the project becomes commercially impracticable.”).

⁴⁴ Id. (“The problem with the concept of impracticability is that it is never clear just how much hardship must be incurred before relief can be granted. A mere increase in cost of performance is insufficient.”).

⁴⁵ See, e.g., Seaboard Lumber Co. v. United States, 41 Fed. Cl. 401, 416-17 (1998) (rejecting federal contractor’s defense that performance became commercially impracticable due to precipitous market changes).

⁴⁶ 5 PHILIP L. BRUNER & PATRICK J. O’CONNOR, JR., BRUNER AND O’CONNER ON CONSTRUCTION LAW § 15:28.50 (2002) (“It is at the point that delayed or suspended performance shades off into commercial impracticability that the remedy shifts from mere time extension to termination of the contract.”).

⁴⁷ See, e.g., McGeehin & Spangler, supra note 4, at 19 (“The doctrine of force majeure represents a shift from the requirement that performance be impossible to a more contemporary standard that performance be more difficult or impracticable.”).

⁴⁸ See, e.g., Ezeldin & Helw, supra note 29, at 04518005-8 (proposing model force majeure provision under which contractor shall “endeavor to continue performing his or her obligations under the agreement so far as reasonably practicable”).

⁴⁹ McGeehin & Spangler, supra note 4, at 19 (“[T]he doctrine of imp[ractica]bility applies only if the parties have not drafted a specific provision allocating the risks of nonperformance.”).

⁵⁰ But see Phelps, supra note 21, at 672 (“The doctrine of impracticability is likely to apply to COVID-19.”).

⁵¹ Kenya Rothstein, How Parties Can Use Covid-19 to Excuse Performance of Contracts, 22 U.C. DAVIS BUS. L.J. 297, 308 (2022) (quoting Lloyd v. Murphy, 25 Cal. 2d 48, 54, 153 P.2d 47, 50 (1944)).

⁵² RESTATEMENT (SECOND) OF CONTRACTS § 293 (1981).

⁵³ Renata A. Guidry, The Steel Price Explosion: What Is an Owner or A Contractor to Do?, 24 CONSTRUCTION LAWYER, 3, at 5, 7 (Summer 2004).

not typically amount to mutual mistake: If the pandemic arises after contract formation, the parties were not mistaken about the absence of pandemic conditions at the time of contracting. If the pandemic arose prior to contract formation, then the parties arguably should have accounted for its impact on contract performance. Because the doctrine of mutual mistake is not applicable to the failure of the parties to predict the future, it typically does not excuse performance simply because a party regrets its bargain (e.g., due to unanticipated increases in the cost of performance).⁵⁴

The common law doctrines described above may operate to excuse a party from contract performance in the event of an unforeseen circumstance such as a pandemic, provided that the circumstance is not specifically addressed by contract language or statute.

B. Statutory Force Majeure

1. Generally Applicable Provisions

The doctrine of force majeure, excusing a contracting party’s performance where it became impossible due to uncontrollable events such as acts of God, arose under Roman law.⁵⁵ Force majeure is a French term that derives from the doctrine’s adoption and codification in the Napoleonic Code (or French Civil Code).⁵⁶ Force majeure continues to be codified in many civil law countries, including many Middle Eastern countries,⁵⁷ serving as a general statutory provision that will excuse contract performance upon the occurrence of a force majeure event.

In common law countries such as the United States, there is less likely to be a generally applicable force majeure statute. Although the general statutes of most U.S. states mention the term “force majeure,” in most cases it is just a “passing reference” rather than substantive law.⁵⁸ Louisiana law (owing to its origins in French Civil Law) is an exception, having a force majeure statute providing that a contracting party is not obligated to perform when performance is rendered impossible due to a “fortuitous event,” unless the party assumed the risk of such event.⁵⁹ In other U.S. states, if there is a substantive force majeure statute enacted by the legislature, it typically is not generally applicable but rather applies to specific circumstances such as public construction contracts.⁶⁰ Likewise, most force majeure provisions in federal law apply to specific public contracting circumstances.⁶¹

2. Contracts for the Sale of Goods

In the case of contracts for the sale of goods subject to the Uniform Commercial Code (UCC), the UCC may provide additional force majeure protections for those contracting parties. Under the UCC, a seller of goods is excused from performance if it becomes impracticable due to unforeseen circumstances not contemplated by the parties at the time of contracting. The UCC has been enacted by most U.S. state legislatures, although the exact statutory language may vary from state to state. In the case of supply subcontracts on construction projects, the UCC may provide a statutory ground for the supplier not to fill orders, due to material price increases arising from a pandemic.⁶² During the COVID-19 pandemic, many general contractors cited the UCC in seeking relief from project owners (in the form of a time extension and/or price adjustment). However, UCC statutory protections available to suppliers under their supply subcontracts are probably not available to contractors under the prime contract with the owner. This could place the contractor in the difficult situation where the supplier is statutorily excused from delivering materials to the contractor, but the contractor remains contractually obligated to incorporate the materials into the project.

C. Express Contract Provisions

1. Force Majeure or Excusable Delay

For more than one hundred years, construction contracts have routinely included provisions that are commonly described as force majeure provisions.⁶³ Most standard construction industry contract forms today contain what would be generally considered a force majeure provision.⁶⁴ More often than not, the contract documents do not actually use the term “force majeure,”⁶⁵ but these express contract provisions serve much the

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⁵⁴ See, e.g., Appeal of Southern Dredging Co., Inc., U.S. Army Corps of Engineer Board of Contract Appeals No. 5843, 92-2 B.C.A. (CCH) ¶ 24886 (Feb. 21, 1992) (declining to award price adjustment to fixed-price contractor who encountered 45% increase in fuel prices). But see Aluminum Co. of Am. v. Essex Grp., Inc., 499 F. Supp. 53, 70 (W.D. Pa. 1980) (awarding price adjustment based on mutual mistake to aluminum supplier whose costs of performance increased due to increased electricity prices).

⁵⁵ Ezeldin & Helw, supra note 29, at 04518005-1.

⁵⁶ Id.

⁵⁷ Id. at 04518005-2.

⁵⁸ Wright, Force Majeure Delays, supra note 28, at 35.

⁵⁹ LA. CIV. CODE ANN. Art. 1873 (2023).

⁶⁰ See, e.g., COLO. REV. STAT. § 43-1-1402(4.5) (2023) (defining “force majeure” in the context of design-build contracts for transportation projects); TEX. UTIL. CODE ANN. § 39.055(c) (2023) (defining “force majeure” in the context of public utility contracts).

⁶¹ Osman & Ataei, supra note 7, at 06521004-2 (“U.S. federal law also recognizes force majeure in the context of specific statutes that authorize government contracts with private parties.”).

⁶² See, e.g., Noonan Const. Co. v. Warren Bros. Co., 632 F.2d 1189, 1193–94 (5th Cir. 1980) (excusing aggregate supplier from timely performance in subcontract with paving subcontractor, based on “breakage of machinery” in statutory force majeure provision); Armco Steel Corp. v. Isaacson Structural Steel Co., 611 P.2d 507, 519 (Alaska 1980) (excusing steel supplier for late delivery to bridge contractor, based on force majeure provision including “strikes,” and UCC principles).

⁶³ 5 PHILIP L. BRUNER & PATRICK J. O’CONNOR, JR., BRUNER AND O’CONNER ON CONSTRUCTION LAW § 15:22 (2002).

⁶⁴ Hennings et al., supra note 22, at 04521048-1 (“Most construction contracts contain a force majeure clause to account for the adverse impacts resulting from a force majeure event occurring.”).

⁶⁵ Id. at 04521048-2 (“The contract provisions do not always use the term force majeure.”).

same purpose as the civil law doctrine of force majeure (and its concept of “control”),⁶⁶ as well as the common law doctrines of impossibility,⁶⁷ impracticability,⁶⁸ and frustration.⁶⁹ Whereas the aforementioned civil law and common law doctrines provide relief from the strict enforcement of express contract terms, force majeure provisions expressly provide relief within the body of the contract itself. These express contract provisions typically excuse performance in the event of circumstances, beyond the performing party’s control,⁷⁰ which actually delay performance, and which were not foreseeable at the time of contracting.⁷¹ This provides more certainty to the contracting parties, who can look to the contract language to determine what relief is available upon the occurrence of certain events, rather than rely upon the uncertainty of how a court might rule when requesting common law relief.⁷² An express force majeure provision allows parties to better assess and allocate the risk of unforeseeable occurrences at the time of contracting,⁷³ which ideally should result in prices and other performance terms that are more likely to be a good bargain for both parties. Although force majeure provisions do not necessarily rule out the application of common law doctrines, courts will look first to the express contract language to determine whether it provides relief in the event of a specific occurrence.⁷⁴ The language of the force majeure provision in the contract may also inform the court’s application of common law doctrines, as the contract language is evidence of how the parties intended to allocate risk of unforeseen occurrences.

Unlike the aforementioned common law doctrines, where the default remedy is to excuse further performance (effectively terminating the contract), a force majeure provision typically excuses performance temporarily, in the nature of a contract suspension and/or time extension.⁷⁵ A force majeure provision typically offers relief in broader circumstances than the common law doctrines, as obstacles to performance need not rise to the level of “commercially impracticable” in order for the parties to be entitled to relief under the force majeure provision.⁷⁶ The contract may define what would constitute a force majeure event⁷⁷ (or alternatively, an “act of God”⁷⁸). More often, however, the force majeure provision will contain a list of specific circumstances that would entitle the parties to relief.⁷⁹ The list of specific circumstances will often be concluded with what is commonly known as a “catch-all phrase,” entitling a party to relief if delayed by other unforeseeable occurrences beyond its control that are not specifically identified.⁸⁰ Occasionally, the force majeure provision will forego attempting to identify specific circumstances that would warrant relief, and will simply provide that the parties are entitled to additional time if delayed by unforeseeable events beyond their control.⁸¹

Many force majeure provisions, especially in public construction contracts, are modeled after the “Default” provision in the Federal Acquisition Regulations (FAR) applicable

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⁶⁶ 5 PHILIP L. BRUNER & PATRICK J. O’CONNOR, JR., BRUNER AND O’CONNER ON CONSTRUCTION LAW § 15:22 (2002).

⁶⁷ Seng Hansen, Susy F. Rostiyanti & Wellie Tjahyadi, A Practical Decision-Making Framework for Extension of Time Claims Associated with Force Majeure Events, 14 J. LEGAL AFF. & DISP. RESOL. ENGINEERING & CONSTRUCTION, 4, at 03722003-2 (Nov. 2022) (“The force majeure clause entitles a party to stop performing its contractual obligations due to certain circumstances beyond its control so that the contractual performance becomes impossible, inadvisable, illegal, or impractical.”).

⁶⁸ McGeehin & Spangler, supra note 4, at 19 (“[T]he use of the term ‘force majeure’ is a clear intention to provide some performance relief, and the doctrine of impracticability provides a legal framework for evaluating these claims.”); see also Ezeldin & Helw, supra note 29, at 04518005-1 (“A force majeure clause is a contract provision that entitles a party to stop performing its contractual obligations through suspension or termination if certain circumstances beyond its control occur so that performance becomes impossible, inadvisable, illegal, or commercially impracticable.”).

⁶⁹ O’Connor, supra note 43, at 10 (“After all, the common belief is that force majeure provisions are really intended to address frustration because of the judiciary’s reluctance to award relief on this theory.”).

⁷⁰ Wright, Force Majeure Delays, supra note 28, at 34 (“Force majeure clauses often exclude events that are ‘reasonably within the control of either party.’”).

⁷¹ Jennifer Sniffen, In the Wake of the Storm: Nonperformance of Contract Obligations Resulting from a Natural Disaster, 31 NOVA L. REV. 551, 572 (2007) (“Many force majeure clauses require an event to be unforeseeable at the time the contract is formed.”).

⁷² Noetzel, supra note 1, at 1358.

⁷³ Wright, Force Majeure Delays, supra note 28, at 33; Sniffen, supra note 71, at 555.

⁷⁴ Phelps, supra note 21, at 652.

⁷⁵ Hennings et al., supra note 22, at 04521048-2 (“A key difference between a force majeure clause and common law principles is that a force majeure clause typically allows for temporary suspension of contractual obligations, while the common law principles allow for permanent termination.”).

⁷⁶ O’Connor, supra note 43, at 11 (“[F]orce majeure events that do not render performance ‘impracticable’ may nevertheless justify a renegotiation of the terms of performance where they materially impact the project in an adverse manner.”); Ezeldin & Helw, supra note 29, at 04518005-6 (observing that force majeure provisions employ a “less rigorous standard” than the common law doctrines, in that they do not require performance to be “impossible,” but “that the performance is prevented, delayed, adversely affected, or hindered”).

⁷⁷ See, e.g., United States v. Nevada Department of Transportation, No. 16-CV-00453 (D. Nev. Sep. 14, 2016) (“‘Force Majeure,’ for purposes of this Consent Decree, is defined as any event arising from causes beyond the control of NDOT, its Contractors, or any entity controlled by NDOT that delays or prevents the performance of any obligation under this Consent Decree despite NDOT’s best efforts to fulfill the obligation.”).

⁷⁸ See, e.g., Vermont Std. Spec. § 101.02 (“An act of God means an earthquake, flood, cyclone, or other cataclysmic phenomena of nature beyond the ability of a prudent Contractor to foresee and make preparation to defend against damage.”); see also Osman & Ataei, supra note 7, at 06521004-2 (“The concepts of force majeure and act of God are intertwined and are often used interchangeably.”).

⁷⁹ Hennings et al., supra note 22, at 04521048-5.

⁸⁰ William Cary Wright, Force Majeure Clauses and the Insurability of Force Majeure Risks, 23 CONSTRUCTION LAWYER, 4, at 16, 25 (Fall 2003) [hereinafter Wright, Force Majeure Clauses]; Hennings et al., supra note 22, at 04521048-1; see also Phelps, supra note 21, at 654 (“Most force majeure clauses contain a list of specific events that would excuse a party’s nonperformance, along with a general ‘catchall provision.’”).

⁸¹ Hennings et al., supra note 22, at 04521048-5, 04521048-6.

to construction contracts to which the federal government is a party.⁸² At least as early as the 1930s, federal construction contracts typically provided “that the right of the contractor to proceed shall not be terminated or the contractor charged with liquidated damages because of any delays in the completion of the work due to unforeseeable causes beyond the control and without the fault or negligence of the contractor, including, but not restricted to, acts of God, or of the public enemy, acts of the Government, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather or delays of subcontractors due to such causes,” subject to the contractor’s obligation to timely notify the government of an occurrence of such excusable delay.⁸³ Nearly identical language is still incorporated into almost all of the federal government’s fixed-price construction contracts to this day.⁸⁴

A similar provision is included in almost all standard form contracts used within the construction industry. For example, the general conditions of most construction contracts using the American Institute of Architects (AIA) forms provide, “If the Contractor is delayed at any time in the commencement or progress of the Work . . . by labor disputes, fire, unusual delay in deliveries, unavoidable casualties, adverse weather conditions . . ., or other causes beyond the Contractor’s control” or “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.”⁸⁵ Similarly, the standard general conditions of construction contracts using the Engineers Joint Contract Documents Committee (EJCDC) forms provide, “If Contractor’s performance or progress is delayed, disrupted, or interfered with by unanticipated causes not the fault of and beyond the control of Owner, Contractor, and those for which they are responsible, then Contractor shall be entitled to an equitable adjustment in Contract Times. . . . Causes of delay, disruption, or interference that may give rise to an adjustment in Contract Times under this paragraph include but are not limited to . . . severe and unavoidable natural catastrophes such as fires, floods, epidemics, and earthquakes,” as well as “abnormal weather conditions” and “acts of war or terrorism.”⁸⁶ Importantly, while these provisions often entitle the contractor to an extension of time, they rarely provide that the contractor is entitled to additional compensation for extra costs arising from the force majeure circumstances.⁸⁷

All fifty state DOTs publish Standard Specifications for highway and related construction projects.⁸⁸ The Standard Speci-

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⁸² 48 C.F.R. § 52.249-10(b) (2022). But see Noetzel, supra note 1, at 1354 (noting that a different FAR provision, 48 C.F.R. § 52.249-14, “serves as the default force majeure-like provision for most federal acquisition contracts” (as opposed to construction contracts)).

⁸³ Eastern Contracting Co. v. United States, 97 Ct. Cl. 341, 347-48 (1942) (quoting provision in 1934 highway construction contract for the U.S. Department of War); General Casualty Co. of America v. United States, 127 F. Supp. 805, 815, 130 Ct. Cl. 520, 537 (1955) (quoting provision in 1943 airport construction contract for the Civil Aeronautics Administration); see also District of Columbia v. Heman Ward, Inc., 261 A.2d 836, 837 n.1 (D.C. Cir. 1970) (quoting similar provision in 1957 bridge construction contract for the District of Columbia Highway Department); Pearson, Dickson, Inc. v. United States, 115 Ct. Cl. 236, 240 (1950) (quoting similar provision in 1942 railroad construction contract for the U.S. Department of War).

⁸⁴ 48 C.F.R. § 52.249-10(b) (2022); see also Noetzel, supra note 1, at 1365 (reciting a similar “nonexhaustive list of occurrences that may qualify as an excusable delay” under 48 C.F.R. § 52.249-14).

⁸⁵ American Institute of Architects, General Conditions of the Contract for Construction, AIA Document A201–2017, § 8.3.1 (2017), available at https://aiacontracts.com/contract-documents/25131-general-conditions-of-the-contract-for-construction; see also Hennings et al., supra note 22, at 04521048-2 (summarizing § 8.3.1 of the 2017 AIA A201 General Conditions); Wright, Force Majeure Delays, supra note 28, at 36 (describing § 8.3.1 of the 1997 AIA A201 General Conditions as a force majeure provision).

⁸⁶ Engineers Joint Contract Documents Committee, Standard General Conditions of the Construction Contract, EJCDC Document C–700, § 4.05.C (2013).

⁸⁷ See, e.g., Patricia D. Galloway, The Art of Allocating Risk in an EPC Contract to Minimize Disputes, 38 CONSTRUCTION LAWYER, 4, at 26, 31 (Fall 2018) (“In order to avoid interpretation issues, all force majeure events should be clearly identified, as well as any limitations on recovery (such as time extensions but no compensation).”). But see Wright, Force Majeure Delays, supra note 28, at 37 (contending that under some standard construction industry contracts, “the contractor is entitled to a time extension and its actual cost without a fee as a consequence of a traditional force majeure event”).

⁸⁸ ALA. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2022) [hereinafter Alabama Std. Spec.]; ALASKA DEP’T OF TRANSP. & PUB. FACILITIES, STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2020) [hereinafter Alaska Std. Spec.]; ARIZ. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2021) [hereinafter Arizona Std. Spec.]; ARK. STATE HIGHWAY & TRANSP. DEP’T, STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2014) [hereinafter Arkansas Std. Spec.]; CAL. DEP’T OF TRANSP., STANDARD SPECIFICATIONS (2022) [hereinafter California Std. Spec.]; COLO. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2022) [hereinafter Colorado Std. Spec.]; CONN. DEP’T OF TRANSP., SPECIFICATIONS FOR ROADS, BRIDGES, AND INCIDENTAL CONSTRUCTION (2005) [hereinafter Connecticut Std. Spec.]; DEL. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2020) [hereinafter Delaware Std. Spec.]; FLA. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2023-24) [hereinafter Florida Std. Spec.]; GA. DEP’T OF TRANSP., STANDARD SPECIFICATIONS CONSTRUCTION OF TRANSPORTATION SYSTEMS (2021) [hereinafter Georgia Std. Spec.]; HAW. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2005) [hereinafter Hawaii Std. Spec.]; IDAHO TRANSP. DEP’T, STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2023) [hereinafter Idaho Std. Spec.]; ILL. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2022) [hereinafter Illinois Std. Spec.]; IND. DEP’T OF TRANSP., STANDARD SPECIFICATIONS (2022) [hereinafter Indiana Std. Spec.]; IOWA DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY AND BRIDGE CONSTRUCTION (2023) [hereinafter Iowa Std. Spec.]; KAN. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR STATE ROAD AND BRIDGE CONSTRUCTION (2015) [hereinafter Kansas Std. Spec.]; KY. TRANSP. CABINET, STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2019) [hereinafter Kentucky Std. Spec.]; LA. DEP’T OF TRANSP. & DEV., STANDARD SPECIFICATION FOR ROADS AND BRIDGES (2016) [hereinafter Louisiana Std. Spec.]; ME. DEP’T OF TRANSP., STANDARD SPECIFICATIONS (2020) [hereinafter Maine Std. Spec.]; MD. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION AND MATERIALS (2023) [hereinafter Maryland Std. Spec.]; MASS. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR

fications are incorporated into most construction contracts to which a state DOT is a party. Typically, Division 100 of the Standard Specifications consists of general provisions, which are comparable to the general conditions of the construction industry’s standard form contracts such as the AIA and EJCDC documents. The Standard Specifications of almost all fifty state DOTs include a provision that would be commonly recognized as a force majeure provision. As in the FAR, these are often identified as “excusable delay” (rather than force majeure) provisions because they provide the contractor an opportunity to obtain a time extension, but not extra compensation, in the event of force majeure circumstances.

An important consideration with pandemics is whether a pandemic-related delay or disruption in contract performance is addressed by the contract’s force majeure provision.⁸⁹ As far back as the early 1900s, even prior to the 1918 influenza pandemic, it was not unusual for commercial contracts to provide time extensions due to occurrences such as epidemics and quarantines.⁹⁰ Force majeure provisions in most construction contracts today rarely list “pandemic,”⁹¹ but frequently list “epidemic,” as specific circumstances that may warrant relief. A pandemic, such as COVID-19, is likely covered where the force majeure provision specifically identifies epidemics as circumstances warranting relief.⁹² Even when the contract does not specifically identify epidemics or pandemics, it may specifically identify pandemic-related circumstances such as quarantines as situations warranting relief.⁹³ However, even where the force majeure provision specifically identifies pandemic-related circumstances such as epidemics or quarantines, the contractor may not be entitled to relief where the circumstances were foreseeable at the time of contracting (e.g., for contracts executed after the onset of the COVID-19 pandemic).⁹⁴ As seen above, the FAR clause and the EJCDC documents specifically provide for a contract time extension for delays arising from epidemics that are unforeseeable (or unanticipated), provided

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HIGHWAYS AND BRIDGES (2023) [hereinafter Massachusetts Std. Spec.]; MICH. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION (2020) [hereinafter Michigan Std. Spec.]; MINN. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION (2020) [hereinafter Minnesota Std. Spec.]; MISS. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2017) [hereinafter Mississippi Std. Spec.]; MO. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2023) [hereinafter Missouri Std. Spec.]; MONT. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2020) [hereinafter Montana Std. Spec.]; NEB. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2017) [hereinafter Nebraska Std. Spec.]; NEV. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2014) [hereinafter Nevada Std. Spec.]; N.H. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2016) [hereinafter New Hampshire Std. Spec.]; N.J. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2019) [hereinafter New Jersey Std. Spec.]; N.M. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY AND BRIDGE CONSTRUCTION (2019) [hereinafter New Mexico Std. Spec.]; N.Y. STATE DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION AND MATERIALS (2024) [hereinafter New York Std. Spec.]; N.C. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROADS AND STRUCTURES (2018) [hereinafter North Carolina Std. Spec.]; N.D. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2023) [hereinafter North Dakota Std. Spec.]; OHIO DEP’T OF TRANSP., CONSTRUCTION AND MATERIALS SPECIFICATION (2023) [hereinafter Ohio Std. Spec.]; OKLA. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2019) [hereinafter Oklahoma Std. Spec.]; OR. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION (2024) [hereinafter Oregon Std. Spec.]; PA. DEP’T OF TRANSP., CONSTRUCTION SPECIFICATIONS (2020) [hereinafter Pennsylvania Std. Spec.]; R.I. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2023) [hereinafter Rhode Island Std. Spec.]; S.C. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY CONSTRUCTION (2007) [hereinafter South Carolina Std. Spec.]; S.D. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROADS AND BRIDGES (2015) [hereinafter South Dakota Std. Spec.]; TENN. DEP’T OF TRANSP. STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2021) [hereinafter Tennessee Std. Spec.]; TEX. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION AND MAINTENANCE OF HIGHWAYS, STREETS, AND BRIDGES (2024) [hereinafter Texas Std. Spec.]; UTAH DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2024) [hereinafter Utah Std. Spec.]; VT. AGENCY OF TRANSP., STANDARD SPECIFICATIONS FOR CONSTRUCTION (2024) [hereinafter Vermont Std. Spec.]; VA. DEP’T OF TRANSP., ROAD AND BRIDGE SPECIFICATIONS (2020) [hereinafter Virginia Std. Spec.]; WASH. STATE DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD, BRIDGE, AND MUNICIPAL CONSTRUCTION (2024) [hereinafter Washington Std. Spec.]; W.V. DEP’T OF TRANSP., STANDARD SPECIFICATIONS ROADS AND BRIDGES (2023) [hereinafter West Virginia Std. Spec.]; WISC. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR HIGHWAY AND STRUCTURE CONSTRUCTION (2023) [hereinafter Wisconsin Std. Spec.]; WYO. DEP’T OF TRANSP., STANDARD SPECIFICATIONS FOR ROAD AND BRIDGE CONSTRUCTION (2021) [hereinafter Wyoming Std. Spec.].

⁸⁹ Geoffrey F. Palachuk, The New Decade of Construction Contracts: Technological and Climate Considerations for Owners, Designers, and Builders, 11 SEATTLE J. TECH., ENVTL. & INNOVATION L. 171, 204–05 (2020) (“The force majeure language negotiated by the contracting project participants can even reach issues like global pandemics, epidemics, and quarantines. Whether frustration of contract or force majeure might apply in such instances would vary among contracts and depend upon the specific language employed by the contracting parties.”).

⁹⁰ See, e.g., Schwaner v. Kerr, 170 F. 92, 93 (D. Or. 1909), aff’d, 177 F. 659 (9th Cir. 1910); see also Wright, Force Majeure Clauses, supra note 80, at 25 (“Other terms that force majeure drafters should add in light of post-September 11 biological warfare fears may include ‘epidemics’ and ‘quarantines.’”).

⁹¹ Phelps, supra note 21, at 665 (“Unfortunately, despite the robust canon of pandemic predictions, the term ‘pandemic’ is glaringly absent from pre-COVID-19 contracts.”); Id. at 677 (“[V]ery few contracts contained pandemic-specific language before COVID-19 started to spread across the globe.”).

⁹² Osman & Ataei, supra note 7, at 06521004-3 (“[P]andemic is in essence an epidemic that has spread internationally and covers a wider geographic area. If the force majeure clause includes pandemics or (similarly) disease or epidemics, or even, potentially, acts of God or government actions, then it is likely that the COVID-19 pandemic and related sweeping actions to combat the pandemic are a force majeure event.”).

⁹³ See, e.g., Galloway, supra note 87, at 31 (“Typical force majeure risks include acts of God, fires, explosions, war, terrorism, acts of government, embargo, blockade, and quarantine.” (emphasis supplied)).

⁹⁴ Osman & Ataei, supra note 7, at 06521004-4 (questioning “whether the contractor can invoke the act of God clause for projects bid after the start of the pandemic”).

that the delays are beyond the control of the contracting parties. The FAR also specifically addresses quarantine restrictions and other acts of government that may impact contract performance. The AIA documents do not specifically identify epidemics or quarantines, but do specifically address unusual delay in deliveries (which could apply to pandemic-related supply chain disruptions) as well as a catch-all for other unforeseeable occurrences beyond the contractor’s control.⁹⁵

More than half of the state DOT Standard Specifications (twenty-eight out of fifty) specifically identify epidemics as circumstances that may warrant a time extension. Roughly one-third of the Standard Specifications (seventeen out of fifty) specifically identify quarantines as circumstances that may warrant a time extension. Where the force majeure or excusable delay provision in the state DOT contract includes a list of specific circumstances that would warrant a time extension, but does not specifically identify epidemics or quarantines as such circumstances, there will be uncertainty regarding whether the contractor is entitled to a time extension for pandemic-related delays under the force majeure provision’s catch-all phrase.⁹⁶

Although an excusable delay provision is what is most often described as the force majeure provision, construction contracts often contain another form of force majeure provision that could compensate the contractor for extra costs incurred as a result of an act of God. The most common form of this in state DOT contracts is a provision entitling the contractor to recover the costs of repairing damage to the work caused by an act of God.⁹⁷ The monetary relief provided by this provision could be significant, because otherwise the risk of damage during construction could fall to the contractor⁹⁸ (or its builders risk insurance carrier). Although damage to the work is more likely to be directly caused by an extreme weather event than a pandemic, it is conceivable that the work could be damaged by civil disturbances or other secondary consequences of a pandemic. Contractors seeking monetary compensation (rather than simply a time extension) for extra costs arising out of pandemics should examine the specific force majeure contract language for the project and consider whether the contract language addresses the additional compensation sought.

2. Equitable Adjustment

In addition to the time extension available under the force majeure (or excusable delay) provision, a construction contractor will often seek additional compensation for increased cost of performance arising out of a pandemic or other force majeure event. The additional compensation sought is often referred to as an “equitable adjustment,” perhaps deriving from the “Equitable Adjustment” provisions in the FAR applicable to construction contracts to which the federal government is a party.⁹⁹ State DOT construction contracts may or may not use the term “equitable adjustment,”¹⁰⁰ but they generally provide for a contract price adjustment under specific circumstances. Although the contracts generally encourage the state DOT and its contractor to negotiate an agreement on the amount of the price adjustment, in the event that the parties cannot reach an agreement, the state DOT is to make a price adjustment that is “fair and equitable,”¹⁰¹ provided that the contractor is entitled to monetary relief.

As discussed above, the force majeure provision typically provides that a delay arising out of a pandemic or pandemic-related circumstances (such as a quarantine) is merely excusable, which means that the contractor’s remedy is a time extension.¹⁰² The force majeure provision may not expressly preclude compensation for the contractor’s time-related costs arising from such delays.¹⁰³ However, generally speaking, in order for an excusable delay to transform into a compensable delay, there

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⁹⁵ Herrmann, supra note 6, at 04523008-3 (“Because disease outbreaks such as COVID-19 are not explicitly listed, a contractor relying on such a force majeure clause would need to rely on the catchall phrase of ‘other causes beyond the Contractor’s Control’ and/or potentially the ‘unusual delay in deliveries’ portion of the clause to assert a COVID-19-related force majeure claim.”).

⁹⁶ Phelps, supra note 21, at 663 (“If a clause is worded more broadly or includes a catchall phrase, courts will look to the rest of the contract to determine the scope of the force majeure clause, and will apply greater scrutiny to alleged force majeure events that are not specifically listed.”); Sniffen, supra note 71, at 559 (“[A] broad force majeure clause will be narrowly interpreted, only encompassing the specific events or things stated in the contract . . ..”).

⁹⁷ See, e.g., New Pueblo Constructors, Inc. v. State, 696 P.2d 185, 189, 144 Ariz. 95, 99 (1985) (citing provision in the 1969 Arizona Std. Spec. relieving contractor of financial responsibility for damage to the work caused by “acts of God”); Maine Std. Spec. § 104.27 (“All repairs or temporary Structures that are required because of property damage that is directly caused by an Uncontrollable Event may entitle the Contractor to an Equitable Adjustment if the Contractor complies with the notification, documentation and procedural requirements set forth in the Contract.”). “Uncontrollable Event” in the Maine DOT contract is defined to include “quarantine restrictions.” Maine Std. Spec. § 101.2.

⁹⁸ Hennings et al., supra note 22, at 04521048-3 (“At common law, the contractor is responsible for any damage or loss that occurs to a structure during its construction. However, if a force majeure event causes the damage, then the contractor may be able to find relief, albeit temporarily, via a force majeure clause.” (internal citations omitted)).

⁹⁹ See, e.g., 48 C.F.R. § 252.243-7002 (2023) (“Requests for Equitable Adjustment”).

¹⁰⁰ See Arizona Std. Spec. § 101.02 (defining “Equitable Adjustment” as “[a]n increase or decrease in the contract price or time made by Supplemental Agreement”); Maine Std. Spec. § 109.7.1 (defining “Equitable Adjustment” as “an adjustment to compensation due to a change in the nature or scope of Work”); Florida Std. Spec. § 4-3.2 (allowing contractor to “submit to the Department a request for equitable adjustment of compensation or time or other dispute resolution proposal”).

¹⁰¹ 23 C.F.R. § 635.109(a)(3)(ii) (2023).

¹⁰² But see California Std. Spec. § 8-1.07C (“The Department may make a payment adjustment for an excusable delay that affects your costs.”); Florida Std. Spec. § 8-7.3.2 (“[I]f it is determined that there was an increase in the time or the cost of performance of the controlling item of work beyond the control of the Contractor, then an adjustment of Contract Time will be made, and a monetary adjustment will be made, excluding loss of anticipated profits, and the Contract will be modified in writing accordingly.”).

¹⁰³ Wright, Force Majeure Delays, supra note 28, at 36-37 (observing that standard construction industry contract forms “do not preclude the contractor from recovering damages as a consequence of a force majeure event beyond the control of both the contractor and owner”).

must have been some action taken by the state DOT (such as a suspension order) that is a proximate cause of the delay or time-related costs. This is discussed in greater detail in Section III.A.1.b.

Contractors are generally entitled to compensation for the direct costs of extra work that they are required to perform beyond the contract scope of work. Along those lines, state DOT construction contracts often expressly provide for a contract price adjustment to reflect the contractor’s direct costs to repair or protect work damaged as a result of force majeure events.¹⁰⁴ While a pandemic itself seems unlikely to directly result in physical damage to the work (as with other force majeure events such as unusually severe weather), the contractor may be required to take extra measures to protect the work from degradation during a pandemic-related shutdown event, or to repair work damaged due to a civil disturbance associated with a pandemic. Although this provision would typically not compensate a contractor for time-related costs associated with a pandemic (such as delay damages or the increased cost of performing work later in time), it may provide the contractor some measure of monetary relief.

For broader monetary relief, to encompass the contractor’s actual increased costs of performing the contract work as a result of a pandemic, the contractor will probably need to seek an equitable adjustment on the basis of changed conditions. For federally aided highway contracts, federal law generally provides that the contract must provide for a price adjustment in the event of changed conditions, including differing site conditions, suspensions of work for reasons beyond control of the contractor, and significant changes to the character of the work.¹⁰⁵ Consequently, most state DOT Standard Specs provide for a price adjustment for these reasons.¹⁰⁶

The changed condition that is most well known and most frequently asserted is probably the differing site conditions clause, which entitles the contractor to a price adjustment for increased costs associated with unpredictable physical conditions at the site (usually latent subsurface conditions).¹⁰⁷ As with the differing site conditions provision in the FAR associated with federal contracts,¹⁰⁸ this clause typically relates to unknown physical conditions at the site that predated contract formation, which are highly unlikely to be the result of a pandemic.¹⁰⁹

Suspension, on the other hand, could provide grounds for a contractor to seek a price adjustment related to a pandemic.¹¹⁰ If the state DOT or other government agency issues an order that results in stoppage of the work, then the contractor might seek a price adjustment under the suspension clause of the changed conditions provision. Even in the absence of an affirmative act by the government, the contractor may argue that its work was constructively suspended, provided that its work was delayed as a result of the pandemic, in an effort to transform the delay from an excusable one to a compensable one. Suspension is discussed in greater detail in Section III.B.2.

In the absence of a suspension order, the contractor’s best path to a price adjustment is probably based on the “significant changes in the character of work” clause of the changed conditions provision.¹¹¹ There are two prongs to this clause.

The first prong entitles the contractor to a price adjustment if there is a significant deviation (typically at least a 25% deviation) in quantities of a “major item of work.”¹¹² This would potentially entitle the contractor to monetary relief in the way of a price adjustment to reflect increased material prices resulting from supply chain disruptions such as those that occurred in the wake of the COVID-19 pandemic. However, this price adjustment would only be available for those materials that were designated major contract items in the contract documents, and only to the extent that the final quantities deviated from the bid quantities by 25% or more.

The second prong entitles the contractor to a price adjustment if “the character of the work as altered differs materially in kind or nature from that involved or included in the original proposed construction.”¹¹³ When the contract work has to be performed during a pandemic that was not foreseen at the time of contracting, the contractor could reasonably take the position that the work differs materially from what was contemplated at the time of contracting, and seek a price adjustment on that basis. However, the state DOT may argue that the contractor is only entitled to an equitable adjustment for “significant changes in the character of the work” after the state DOT (or its engineer) has first taken the affirmative action to direct the contractor to make “changes in quantities [or] alterations in the work.”¹¹⁴

If it is determined that the contractor is entitled to a price adjustment for any of the reasons above, the question arises how to calculate the price adjustment. Generally speaking, if the contractor is entitled to a price adjustment due to the pandemic, then the price adjustment should reflect the contractor’s

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¹⁰⁴ See, e.g., New Pueblo Constructors, Inc. v. State, 696 P.2d 185, 189, 144 Ariz. 95, 99 (1985) (citing provision in the 1969 Arizona Std. Spec. relieving contractor of financial responsibility for damage to the work caused by “acts of God”); Maine Std. Spec. § 104.27 (“All repairs or temporary Structures that are required because of property damage that is directly caused by an Uncontrollable Event may entitle the Contractor to an Equitable Adjustment if the Contractor complies with the notification, documentation and procedural requirements set forth in the Contract.”). “Uncontrollable Event” in the Maine DOT contract is defined to include “quarantine restrictions.” Maine Std. Spec. § 101.2.

¹⁰⁵ 23 C.F.R. § 635.109 (2023).

¹⁰⁶ See, e.g., Indiana Std. Spec. § 104.02 (“Changed conditions that will be considered as reason for a contract adjustment are differing site conditions, suspensions of work ordered by the Engineer, and significant changes in the character of the work.”).

¹⁰⁷ 23 C.F.R. § 635.109(a)(1) (2023).

¹⁰⁸ See, e.g., 48 C.F.R. § 52.236-2 (2023) (“Differing Site Conditions”).

¹⁰⁹ But see Utah Std. Spec. § 00777, pt. 1.13.A (including “force majeure” as an “unforeseen condition” that could entitle the contractor to additional compensation).

¹¹⁰ 23 C.F.R. § 635.109(a)(2) (2023).

¹¹¹ 23 C.F.R. § 635.109(a)(3) (2023).

¹¹² 23 C.F.R. § 635.109(a)(3)(iv)(B) (2023).

¹¹³ 23 C.F.R. § 635.109(a)(3)(iv)(B) (2023).

¹¹⁴ 23 C.F.R. § 635.109(a)(3)(i),(ii) (2023).