By Spencer Krebs, Seth Wamelink, and Robert Ohly

In recent years, tariffs have taken on a major role in U.S. foreign and economic policy. While intended to promote domestic manufacturing, address trade imbalances, and influence foreign relations, tariffs can also create challenges for certain industries such as construction. In some instances, tariffs have led to increased material costs and shifts in supply chains. These effects may contribute to project delays or financial strain on fixed price contracts and can leave contractors responsible for absorbing the added costs.

The impact of tariffs on the construction industry varies across projects and regions. As a result, many contractors and owners have re-examined the contractual provisions used to manage increased material costs and scheduling risks. Some have sought to invoke legal doctrines like force majeure and cardinal change, arguing that tariff-related impacts fall outside their contractual obligations. But courts are unlikely to offer relief unless the risk is accounted for in the contract. This article explores why legal defenses tied to tariffs tend to fail absent contractual protections, and how contractors can better protect themselves moving forward.

Read the article in The Legal Intelligencer on law.com here.