Background
Black & Veatch Construction hired The Boldt Company as a subcontractor to assemble a 60-turbine windfarm in Good Hope, Illinois under a subcontract that designated performance according to a construction schedule as a “material provision.” The subcontract included notice provisions requiring Boldt to notify Black & Veatch of delays caused by Black & Veatch or third parties (specifically GE, the turbine supplier), with Boldt bearing no responsibility for such delays if it provided proper notice.
The project fell behind schedule almost immediately. The first turbine was scheduled to be completed by mid-August 2019, but Boldt could not begin because plans and cranes were not ready. Progress was further slowed by wet ground conditions, unsuitable crane platforms provided by Black & Veatch, and late delivery of turbine parts from GE. Boldt sent multiple written notices and memos documenting these delays. After more than a month with no turbines constructed, Black & Veatch issued notices of default and eventually terminated Boldt’s contract entirely, taking over the remaining work.
Boldt sued for wrongful termination; Black & Veatch countersued for damages caused by failure to meet the construction schedule. The district court granted summary judgment for Black & Veatch on all of Boldt’s claims and proceeded to trial only on Black & Veatch’s damages claim. At trial, Black & Veatch sought approximately $39 million in damages (against an original contract price of $15.4 million), but the jury awarded only $1 in nominal damages after finding that Black & Veatch had not provided a reasonable basis for calculating its claimed damages.
The Court’s Holding
The Seventh Circuit affirmed the jury’s $1 nominal damages verdict and affirmed most of the district court’s evidentiary rulings at trial. The court held that evidence relating to Boldt’s prior performance, the work Black & Veatch took over, and portions of work descoped before termination were properly admitted as relevant to the damages calculation rather than improperly reopening liability issues. The court also affirmed the jury instruction that only nominal damages could be awarded if Black & Veatch failed to establish a reasonable basis for its damages calculations, finding this correctly stated Illinois law and that Black & Veatch had waived objection to the instruction.
However, the court reversed and remanded the district court’s grant of summary judgment on Boldt’s wrongful termination claim. The court held that the subcontract was ambiguous regarding whether Boldt was automatically responsible for all schedule delays or only those it actually caused, and whether the notice provisions were Boldt’s exclusive means of avoiding liability for third-party delays. While the district court’s interpretation was reasonable, it was not the only reasonable reading of the contract. The court determined that a jury must resolve both whether the parties intended the allocation of risk the district court assumed and whether Boldt in fact provided adequate notice of delays caused by Black & Veatch or GE.
Key Takeaways
- Jury verdicts finding insufficient evidence to support damages calculations will be affirmed even when a plaintiff claims to have suffered actual injury.
- Ambiguous contract language regarding allocation of risk for project delays must be interpreted by a jury rather than resolved by summary judgment.
- Evidence relevant to both liability and damages may be admitted at trial if jury instructions clearly delineate the jury’s role.
- The adequacy of notice of delays caused by third parties or the general contractor is a factual question for the jury in construction disputes.
- Trial errors will not warrant reversal unless they likely affected the outcome or violated a party’s right to a fair trial.
Why It Matters
This decision significantly impacts construction contractors and subcontractors by establishing that even detailed contract provisions allocating responsibility for project delays can be ambiguous enough to require jury interpretation. The Seventh Circuit’s emphasis on ambiguity suggests courts will not lightly grant summary judgment against subcontractors claiming they properly notified the general contractor of delays caused by third parties. The affirmation of the nominal damages verdict reinforces that parties seeking substantial damages bear a heavy burden to present reliable evidence from which damages can be calculated with reasonable certainty.
For general contractors, the decision underscores the importance of clearly drafting notice procedures and their consequences. The case also demonstrates that in damages-only trials, courts have significant discretion to admit evidence relevant to damages even if it touches on liability, provided jury instructions properly guide the jury’s role. The ruling strengthens subcontractors’ ability to contest termination decisions by preserving jury questions about whether delays were caused by the subcontractor or by the general contractor or third parties.