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Eichleay Damages and Delay Claims


Better understand and analyze application of the Eichleay formula to help avoid or minimize the legal battles over such delay claims.

Delay claims can be contentious, high-stakes legal battles. Victory or defeat often turns on expert testimony of causation and damages. A contractor's unabsorbed home office expense damage is typically the largest damage sought by the contractor. The Eichleay formula for calculating unabsorbed home office expense damage is both controversial and central to this battle. Since the Eichleay case was decided in 1960, owners, contractors, and others have frequently squared off over the application of this formula, and whether this formula is truly a reasonable estimate of a contractor's unabsorbed overhead damages. This topic will focus on the Eichleay formula, including the various presumptions upon which it is based. Attendees will look at the validity of these presumptions in modern times and in consideration of differences in facts and circumstances that may apply to a particular construction project. Attendees will also consider various prosecution and defense strategies that can be employed to uphold, defeat, or adjust the application of the Eichleay formula.



Scott D. Cahalan

Scott D. Cahalan

Smith, Gambrell & Russell, LLP

  • Partner in the construction law section of Smith, Gambrell and Russell, LLP, an AmLaw 200 firm.
  • Part-time instructor of Construction and Development Law at the Georgia Institute of Technology
  • General counsel to the Georgia Utility Contractor’s Association
  • Worked for an ENR® top 50 general contractor
  • Drafted form construction contracts for the Associated Owners and Developers, a national association
  • Recognized by Chambers USA, The Best Lawyers in America, and Georgia Super Lawyers
  • Frequent author and lecturer on construction law
  • Member of the State Bar of Georgia, Northern District of Georgia, and 11th Circuit Court of Appeals
  • J.D., cum laude, from University of Georgia; B.S. in construction engineering from Iowa State University
  • Contact information s[email protected], [email protected], and (404) 815-3711

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