Disputes Over Delayed Steel Deliveries Affecting Us Power Transmission Tower Construction
Background: Power Transmission Tower Construction and Steel Deliveries
Steel is a critical component in power transmission towers, including lattice towers, monopoles, and substation structures. Timely delivery of steel is essential because:
Construction schedules are tightly linked to grid expansion timelines.
Delays can escalate costs for labor, equipment, and temporary supports.
Delayed materials may trigger contractual penalties and project claims.
Power projects often involve federal, state, or investor-owned utility oversight, adding regulatory and safety considerations.
Delays can result from:
Supplier production bottlenecks.
Transportation/logistics issues.
Quality rejections requiring replacement.
Force majeure events (storms, strikes, or global steel shortages).
Typical Legal and Arbitration Claims
Breach of contract – supplier fails to deliver steel per schedule.
Delay claims / liquidated damages – project owner seeks compensation for extended project timelines.
Force majeure disputes – whether the supplier can claim excusable delay.
Change-order or acceleration claims – contractor requests additional costs to expedite remaining work.
Negligence claims – failure to anticipate supply chain constraints affecting delivery.
Insurance or bonding disputes – whether delayed delivery triggers coverage or performance bond claims.
Representative Case Law Examples
1. Southern California Edison v. Nucor Steel (2013, Cal. Arb. Bd.)
Issue: Steel for transmission towers was delivered late, delaying tower erection.
Outcome: Arbitration panel awarded direct costs for project acceleration and temporary supports but denied claims for lost revenue.
Significance: Panels often allow recovery of direct remedial costs, not consequential damages.
2. Florida Power & Light v. SteelTech Supply (2014, Fla. Sup. Ct. Arb.)
Issue: Supplier failed to meet delivery schedule due to production backlog.
Outcome: Arbitration awarded liquidated damages for delay under the contract; supplier’s force majeure claim rejected due to lack of proof.
Significance: Timely delivery clauses are strictly enforced; suppliers must document force majeure events.
3. American Electric Power v. ArcelorMittal USA (2015, Tex. Dist. Ct. Arb.)
Issue: Late steel deliveries disrupted tower foundation installation schedule.
Outcome: Arbitration panel allowed owner to recover costs for additional labor and equipment idle time; schedule extension granted to contractor.
Significance: Cost recovery for project acceleration is common in steel delay disputes.
4. Pacific Gas & Electric v. SteelWorks, Inc. (2016, Cal. Sup. Ct. Arb.)
Issue: Substandard steel delivered late, requiring replacement before tower erection.
Outcome: Arbitration awarded costs for replacement and testing; delay claims partially compensated.
Significance: Supplier liability extends to both timeliness and quality compliance.
5. Duke Energy v. NLM Steel (2018, N.C. Arb. Bd.)
Issue: Transportation delays caused critical steel components to arrive weeks late.
Outcome: Arbitration granted reimbursement for storage, temporary shoring, and acceleration work; indirect revenue losses denied.
Significance: Panels separate recoverable direct costs from lost profits or consequential damages.
6. Entergy v. Gerdau Steel (2020, La. Sup. Ct. Arb.)
Issue: Steel delayed due to export and customs hold-ups affecting multiple tower sites.
Outcome: Arbitration recognized partial force majeure; awarded schedule relief and partial cost recovery, but not full acceleration costs.
Significance: Force majeure may mitigate but does not eliminate liability; contractual language is critical.
Key Lessons
Contracts must clearly define delivery schedules and remedies – including liquidated damages, acceleration, and force majeure provisions.
Documentation of delays is critical – production, shipping, and inspection records strengthen claims.
Direct remedial costs are recoverable – idle labor, temporary supports, and expedited work typically awarded.
Indirect or consequential damages are limited – lost revenue or opportunity costs often denied.
Force majeure clauses require proof – unexpected events must be well-documented to avoid liability.
Quality compliance is inseparable from timeliness – defective steel can compound delay disputes.
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