A subcontract contains a clause limiting compensation for owner-caused delay to time extension only. What risk does the subcontractor need to recognize?
Correct Answer
B) The clause may bar delay-cost recovery while allowing more time, subject to enforceability
A no-damage-for-delay clause may limit the remedy for delay to additional time rather than delay cost, subject to contract language and enforceability. Other choices invent effects unrelated to the clause.
Why This Is the Correct Answer
A no-damage-for-delay clause may limit the remedy for delay to additional time rather than delay cost, subject to contract language and enforceability. Other choices invent effects unrelated to the clause.
Why the Other Options Are Wrong
Option A: The clause automatically adds profit to every delay
In procurement and contracting, The clause automatically adds profit to every delay is the wrong selection for No-damage-for-delay risk: the choice would not get the project to The clause may bar delay-cost recovery while allowing more time, subject to enforceability, which is the No-damage-for-delay risk result verified by the source.
Option C: Select the clause eliminates schedule updates for no-damage-for-delay risk
Choice C gives The clause eliminates schedule updates. Its specific error: it treats No-damage-for-delay risk as optional.
Option D: The clause turns the subcontract into unit-price work
Choice D (The clause turns the subcontract into unit-price work) is rejected because it answers the No-damage-for-delay risk prompt with the wrong practical move.
Memory Technique
Make no-damage-for-delay risk a tabbed card: cite the exact condition, then choose The clause may bar delay-cost recovery while allowing more time, subject to enforceability.
Reference Hint
Open NASCLA Contractors Guide to Business, Law and Project Management - Basic, 14th Ed.; use by topic index - liquidated damages / delay / claim notice to confirm that A no-damage-for-delay clause may limit the remedy for delay to additional time rather than delay cost, subject to contract language and enforceability.
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