Thursday, November 27, 2014

Pursuing and Proving Delay Damages

Recently the Third Department of the Appellate Division issued some interesting and insightful commentary on pursuing and proving a delay claim (see Mascorp, Inc. v. United States Fid. & Guar. Co.).  The Court noted that "a contractor wrongfully delayed by its employer must establish the extent to which its costs were increased by the improper acts because its recovery will be limited to damages actually sustained."  The concept seems pretty simple: to recover there must be actual damages.  Curiously here, the Court found that the plaintiff's own records established not a loss, but a profit.   Though the Court noted the documents established a 13% profit, I wonder whether a higher profit would have been made had the delay not occurred?  If so, wouldn't there have been delay damages not withstanding the profit?  It appears that the plaintiff's expert failed to identify what records it relied upon in reaching his determination that there were delay damages.  The Court stated that "we can find no correlation between the numbers in the reports and the expert's figures."   In concluding that there was no foundation for the damages claimed, the Court found that the plaintiff's expert affidavit was "conclusory and insufficient to raise a triable issue of whether damages were actually sustained."

The lesson to be learned?  Be careful with your expert affidavits and testimony.  Many (MANY) experts like to talk.  They like to explain how they are right and smarter than everyone else.  Unfortunately they don't always explain themselves well and simply get from point A to point B because "they are right."  Work with your experts and make sure they understand how to explain their position and convince others that their position is correct.  Sometimes your expert can be too smart for his or her own good!

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