In SNC-Lavalin America, Inc. v. Alliant Techsystems, Inc. , 858 F. Supp.2d 620 (W. D. Va. 2012), the United States District Court for the Western District of Virginia addressed the required elements of a claim for constructive acceleration under Virginia law. The project at issue involved the design and construction of a new nitric acid and sulfuric acid concentration plant at an arsenal in Virginia owned by the United States, but operated by the defendant. At the heart of the dispute was a multi-million contract pursuant to which the plaintiff agreed to provide engineering, procurement and construction services. The plaintiff’s performance was wrought with delays, disputes and alleged plan alterations and, in the end, the parties disputed who was to blame for delays to the project’s completion. At trial, the jury found for the plaintiff on its claim for acceleration and awarded damages in the amount of $322,800. After the award, the defendant moved the Court for judgment as a matter of law on the plaintiff’s claim, arguing that the plaintiff failed at trial to produce evidence that it provided a “post-denial notice of constructive order to accelerate.”
In its analysis, the Court noted that acceleration claims fall into two general categories: claims for actual acceleration, which arise when a contractor has been ordered to pick up the pace of its work, and claims for constructive acceleration, which arise when a contractor has a justified claim for an extension of time, but is required to incur additional expense because the owner refuses to grant an extension and requires the contractor to complete the project by the original completion date. While neither party to the case provided the Court with any case law from the United States Court of Appeals for the Fourth Circuit or the Virginia Supreme Court recognizing or applying a constructive acceleration claim, the Court acknowledged that constructive acceleration claims are “recognized in many jurisdictions” and that such a claim is viable under Virginia law. The Court then turned its attention to the fact that different formulations have been used to set forth the requisite elements of a constructive acceleration claim.
In constructive acceleration claims decided by the Federal Circuit and Boards of Contract Appeals, “post-denial notice of a constructive order to accelerate” is an essential element of the cause of action. The Court in SNC-Lavalin America noted, however, that while these cases are instructive, they all involve claims against the United States and are decided with reference to standard clauses in the Federal Acquisition Regulations that do not necessarily appear in private construction contracts. With regard to construction disputes between private entities, the Court held that to prevail on a constructive acceleration claim, a contractor must prove the following elements: (1) that the contractor experienced an excusable delay entitling it to a time extension; (2) that the contractor properly requested the time extension; (3) that the owner failed or refused to grant the requested extension; (4) that the owner demanded that the project be completed by the original completion date despite the excusable delay; and (5) that the contractor actually accelerated the work in order to complete the project by the original completion date and incurred additional costs as a result.
The Court denied the defendant’s motion for judgment as a matter of law on the plaintiff’s claim and, in so doing, provided a clear roadmap for pursuing or defending claims for constructive acceleration under Virginia law going forward.