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Float Time: Who Owns It And Why Ownership Matters

Sunday, February 04, 2007 11:30 am

 
Float Time: Who Owns It And Why Ownership Matters

Critical Path Method (CPM) schedules often include extra time known as float, float time or slack time. The float is the period during which the schedule entitles the contractor to an excusable delay even though the original contract delivery or completion schedule allows more time than is actually necessary to perform the work (CJP Contractors, Inc. v. U.S., 45 Fed. Cl. 343 (1999)). Put differently, the float the CPM assigns to any single performance is the maximum delay the CPM allows before the delay causes a bottleneck effect, delaying subsequent performance and the whole project (Charles Goetz, The Mitigation Principle: Toward A General Theory of Contractual Obligation, 69 Va. L. Rev. 967 (Sept. 1983)).

Why does float ownership matter? Who owns the float becomes an issue when there is concurrent delay and the parties (and/or court) must (1) determine which party is responsible for the delay(s); and (2) calculate the delay's length and whether the contractor should receive extra time to finish its work.

If the owner owns the float, it can require that the contractor perform additional work that is not on a critical path without extending the original contract's deadline and without paying additional compensation to the contractor. Another consequence of the float belonging to the owner arises when the owner does not deliver the job site on time. In that situation, the owner loses the float time but the contractor loses nothing because it never had the right to use the owner's float.

If the contractor owns the float then any change the owner issues to an activity not on the critical path could result in an extension to the contract completion date. Another potential downside to contractor ownership: giving every contractor access to the float. In that circumstance the float becomes communal property -- "costless to any one contractor and therefore overused" (Goetz at 1020).

Who owns the float? There is no one answer to the question. The majority view says that the first party to use the float owns it (David Garcia- Villarreal, CPM Schedules And Project Delay, Construction In Brief, 2002). Some industry insiders insist that if the contract does not specify who owns the float it belongs to the contractor because the contractor should have the right to control its work.

Private Sector Contract Provisions

Although the agreement between the owner and contractor may specify who owns the float, such language is meaningless if the parties do n [...]

 
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