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Waiving Consequential Damages has Consequences


Often, one of the most contentious parts of negotiating a construction contract is the waiver of consequential damages. Many property owners see the waiver within the contract and believe that this is a standard in the industry and so, they accept it and sign the document. This can cause very serious problems in the future. Below, our Charleston construction defects lawyer explains further.

What is a Consequential Damages Waiver

 Property owners have much more to lose by signing a waiver of consequential damages than contractors do. Consequential damages are different from liquidated damages. Liquidated damages are meant to compensate property owners for any economic losses they incurred as a result of a contractor’s failure to substantially complete the project in a timely manner. Liquidated damages are not included in a waiver. Consequential damages, on the other hand, are meant to compensate property owners for losses that were incurred by the property owner due to construction defects after completion.

For example, a property owner may hire a contractor to build a hotel. The project was ultimately completed on time and operations went smoothly for many years. After a very heavy rainstorm, though, the owner finds that some areas of the building envelope have leaked. This may have damaged guest rooms, conference spaces, and other areas of the hotel. Consequently, the owner must close multiple floors and event spaces until the damage can be repaired, losing revenue in the meantime.

The contractor will be responsible for repairing the building envelope. However, they should also be responsible for paying consequential damages, which includes the lost revenue from being unable to rent the space due to the water damage.

How to Avoid a Consequential Damages Waiver

 The best way to make sure you and your property are fully protected is to make sure any contract you sign does not include a waiver of consequential damages. It can also help to include in the contract the damages that will be available should a construction defect incur losses. These damages can include the cost of repairs, increased material and labor costs, loss of use, and lost profits.

The best way to make sure you are covered for consequential damages is to allow a construction defects lawyer review any contract before you sign it. A lawyer will know the language to look for and make sure that you and your property are protected. The most important thing is to understand what consequential damages are, so you never waive your rights to them.

Call Our Construction Defects Lawyer in Charleston Today 

Construction defects do not only cause problems immediately after completion. They can also create issues for many years to come. At Fuller Law Firm, our Charleston construction defects lawyer can ensure that if there is an issue with your project, you receive the full and fair damages that you need to fully compensate you for your losses. Call us now at 843-277-0013 or chat with us online to schedule a consultation and to get the legal help you need.



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