Most construction contracts between an owner and prime contractor provide the owner with the right to terminate the contract for cause or for convenience. In an important decision released in early April, the Connecticut Supreme Court unanimously held that a municipality that elects to terminate the contractor for its own convenience may still recover liquidated damages for project delay incurred prior to the termination of the contract. Under the prime contract, the owner explicitly preserved its right to terminate for convenience “without prejudice to any other right or remedy.”

The Court also rejected the contractor’s claim that the municipality could not collect liquidated damages because it was at least partially at fault for the delays in completing the project, clarifying that, if a contract provides for an extension of the contract’s termination date, due to delays not caused by the contractor, then collection of liquidated damages is not strictly abrogated under Connecticut law. These rulings were made in a lawsuit brought by a contractor against the Town of Southington (Town). Robinson+Cole's Construction Group defended the Town at trial on the merits; its Appellate Group defended the appeal.