A subcontractor sued a prime contractor and its surety for payment of delay costs on a federal Navy project. The surety tried to use a no-damages-for-delay clause in the subcontract to avoid paying the delay costs. The court ruled that the Miller Act (which protects subcontractors on federal projects) overrides no-damages-for-delay clauses, meaning sureties cannot use them to block delay damage claims. This protects subcontractors from losing delay compensation on federal jobs, even if the subcontract says otherwise.
No-damages-for-delay clauses in subcontracts cannot limit a surety's liability under the Miller Act on federal projects—the federal law wins
Dispute resolution clauses requiring you to wait for owner-contractor disputes before suing do not block your Miller Act claim against the surety
Document all delay costs carefully; the surety cannot escape liability by claiming the amount is unclear or needs more discovery