A late building costs the owner money. The exact loss is hard to prove. The parties agree on a daily amount in advance. If the work is late, the owner applies that amount for each day of delay. The term is often shortened to LDs.
Where to find them in the bid documents
- The agreement form in Division 00.
- The supplementary conditions.
- The instructions to bidders or the bid form, on some public jobs.
- The summary of work in Division 01, where the job has phases or milestone dates.
Note the amount, what date it runs from and whether each phase has its own amount.
How they reach a subcontractor
The owner assesses liquidated damages against the prime contractor. Most subcontracts allow the general contractor to pass them down to the subcontractor that caused the delay. The subcontract language decides how. Read the flow-down clause and the delay clause before you sign.
What to check before you bid
- The completion date or the contract time.
- The daily amount and any milestone dates.
- Lead times for your material, including submittal review.
- The notice the contract requires when a delay is not your fault.
- Whether the contract excuses delays caused by weather or by others.
- Your own capacity during the scheduled period.
How to lower the risk
State your lead time in your proposal. Send submittals early. Give written notice as soon as something delays you, and follow the notice rules in the contract. Keep records of when areas were ready for your work.
Limits on liquidated damages
State law affects when a liquidated damages clause is enforced. Some contracts also waive other delay damages. Others do not. These are legal questions with different answers in different states.
This article is general information, not legal advice. Check the bid documents and ask an attorney about your contract.
Takeoff Tool reads cover facts such as the bid date and the completion date from the packet.
Bid documents · Updated 11 Nov 2026