In February 2021, an Appellate Court in New York declined to hold Con Edison liable to a general contractor, even though Con Ed caused substantial delays to the project through its inaction. Dworkin Construction Corp (USA) v. Consolidated Edison Company of New York, Inc., 191 A.D.3d 596 (1st Dept. 2021).
In order to increase electrical capacity to the building under construction, the contractor needed approval from Con Ed for a temporary shutdown and temporary power. Although Con Ed delayed the approval process, resulting in delay damages and lost profits to the contractor, the court dismissed the complaint against Con Ed because the entity that filed the application with Con Ed for this service was the Owner, not the contractor.
Since there was no written agreement between Con Ed and the Contractor and the Owner was the customer, the Court found that Con Ed owed no duty to the Contractor to act upon the electrical service request in a timely manner.
Comment:
Contractor’s occasionally must rely upon utility companies to review applications or provide a service critical to the timely completion of a project. As contractors can be greatly affected by their inaction, they should be proactive in mitigating the impact of potential delays by determining their contractual rights with an Owner and complying with any written notice requirements regarding damages or delays.
About the author: George Marco is an attorney practicing in the field of construction law. He also holds a Bachelor of Science in Mechanical Engineering and was previously employed as a Project Manager for a public improvement contractor.
If you would like more information regarding this topic or any other related to construction law please contact George Marco at george@gmarcolaw.com or call (516) 464-2320.
Disclaimer: This article is for informational purposes only and not intended to serve as legal counsel.
