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Homeowner's Duty to Mitigate or Prevent Damages

Generally, a homeowner who is injured pursuant to the breach of a construction contract can seek both general and special damages. General damages are those that directly flow from the breach and special damages are those that, though not a direct consequence, are precipitated by the breach and can be characterized as "unique" to the homeowner in the given situation.

Liquidated Damages for Delay

When a construction project is delayed through the fault of a contractor, that contractor may be responsible for liquidated damages. Many construction contracts provide for this eventuality by specifying that the contractor must pay a predetermined amount for each day of delay attributed to it. A court will generally enforce such a liquidated damages provision so long as the payment amount is commensurate with the owner's entitlement to damages as opposed to an amount that, instead, operates to penalize the contractor.

Anticipatory Breach of Construction Contract

After a construction contract has been entered into, but prior to the time for performance thereunder, a party may positively declare his intention not to fulfill his contractual obligations. This "anticipatory breach" can occur either through the party's express declaration or it can be implied through the party's conduct. If anticipatory breach occurs by implication, the breaching party's conduct must be unequivocal in the intention not to perform.

The Construction Industry and the Employment of Illegal Aliens

The Immigration Reform and Control Act of 1986 (IRCA), which amends the Immigration and Nationality Act, mandates that employers only hire individuals who may legally work in the United States. This includes United States citizens and nationals as well as authorized aliens. Employers who violate the IRCA may be subject to civil and criminal penalties.

Remedies for Wrongful Termination of Construction Contract

Some terminations of a construction contract are justified. However, a party who wrongfully terminates a contract will be found to have materially breached the contract. When a wrongful termination occurs, the non-terminating party may pursue various courses of action for a recovery.