1 A contractor has a contract for the construction of a large retail store located within a shopping complex. The project owner is very interested in getting the store completed by mid-October to enable the store to open in early November to serve holiday shoppers. The contract contains a provision for $2,000 in liquidated damages for each day beyond October 15 that the contractor achieves substantial completion.

During the excavation for the installation of utility lines for the project, the contractor encountered an unanticipated buried water line, which will require additional time to work around. The construction schedule for the building showed five days of float for the utility line construction, and the estimated time for the additional work was three days. Thus the extra work associated with the buried water line would not extend the duration of the project. Because two activities on the critical path were behind schedule, the contractor’s project manager changed the logic of the construction schedule to show that the utility line construction was a critical activity and requested a three-day extension to the required project completion date to address the work associated with the buried water line.

 Were the actions of the project manager ethical?

 How would you have handled the situation?