Legal Question in Construction Law in California

Unforeseen Material Price Increase on Government Project

If a commodity price (i.e. steel) significantly increases due to material shortages, dock strikes, or another unforeseen condition, can the price differential be recovered by the Contractor on a Government Firm Fixed price contract?


Asked on 4/26/04, 7:53 pm

1 Answer from Attorneys
Gary Redenbacher Redenbacher & Brown, LLP

Re: Unforeseen Material Price Increase on Government Project

This depends on what your contract says, but most contracts I've seen in the construction field you bear the risk of price increases. Otherwise, what use is a contract? This is especially true in public works jobs where the contracts are pretty tight. There could be truly exceptional circumstances when the contract would be voided by a court because neither party to the contract contemplated the unique circumstance. These times will be rather rare, though.

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Answered on 4/27/04, 12:58 pm


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