The First Appellate District of Ohio (Hamilton County) recently found for a contractor on its overhead claim against a public housing authority. In Jindal Builders & Restoration Corp. v. Cincinnati Metro. House Auth., 2020-Ohio-4043, the Court cited a number of cases that allowed a contractor to recover its indirect costs, and specifically home office overhead costs. While the contract in this dispute precluded a contractor from recovering profit on a delay caused by the Owner, the Court found there was nothing in the contract that prevented the Contractor’s recovery for home office overhead costs due to the delays caused by the Owner.
The Court went on to analyze Ohio case law discussing current delays in Ohio between the contractor and the owner. Consistent with those cases, the Court concluded that a contractor is not permitted to recover delays during periods where the contractor had itself delayed the project. Lastly, the Court also distinguished a contractual provision requiring the contractor to provide notice of an impending claim and a contractor’s obligation to provide the monetary claim amount “as soon as practical,” but not later than the final payment. By doing so, the Court allowed emails from the contractor identifying the impending delay to satisfy the contractor’s initial notice requirement. The Court then permitted the monetary claim amount to be submitted five (5) months after the delay had ended.
This case reinforces the following that Ohio courts recognize:
- A contractor’s overhead claims, including home office overhead claims, are real damages caused by an owner delay;
- A contractor cannot recover when there are concurrent delays between a contractor and owner; and
- A difference exists between the requirement to provide notice and the requirement to provide a monetary claim amount.