Construction contracts are full of protections. No-damage-for-delay clauses. Consequential damage waivers. Rights to supplement a subcontractor’s work. Broad scheduling provisions. But a recent Tennessee construction case provides an important reminder: the best contract in the world may not save you from bad project facts.

In Commercial Painting Company, Inc. v. The Weitz Company, LLC (TN Ct. App. Oct. 28, 2026), the dispute involved a general contractor and its drywall subcontractor on a multi-building retirement community. The subcontract was originally worth more than $3.2 million, and the parties eventually disagreed about delays, scheduling, supplemental work, backcharges, and unpaid applications for payment. What began as a fairly typical construction dispute became anything but typical. A jury ultimately found that the general contractor had intentionally misrepresented material facts and awarded the subcontractor $3.9 million in punitive damages. (The case has a lengthy procedural history involving multiple appeals, but this post focuses only on the practical lessons from the most recent decision.)

The facts behind that award are what should get every contractor’s attention. According to the court, the general contractor knew before the subcontract was executed that the project was months behind schedule. It had an updated schedule but provided the drywall subcontractor with an outdated one. The trial court also found that the contractor knew it intended to compress the schedule and supplement the drywall work, but did not disclose those facts to the subcontractor. There were also findings involving backcharges for work caused by other subcontractors and requirements for a higher level of finish than the contract required.

Perhaps more damaging was the project record itself. An internal “Post Mortem” document reflected that even the lowest drywall bid would result in a $1 million loss to the general contractor and discussed reducing that loss by “managing” Commercial Painting. The court also recounted internal communications made after the project concerning putting drywall companies out of business. Those documents became part of the evidence supporting the trial court’s conclusion that the conduct was intentional and egregious.

What is the lesson for contractors? Project management decisions that seem routine today may look very different to a judge or jury five years from now. If the schedule has materially changed, don’t knowingly hand a subcontractor an old schedule without explaining the current situation. If another trade caused defective work, don’t charge the repair costs to an innocent subcontractor. And if you have the contractual right to supplement someone’s work, make sure the project file documents why supplementation was necessary and how the costs were calculated. Those aren’t simply good litigation practices. They are good project-management practices.

This lesson applies equally to subcontractors. Don’t assume that a broad contract provision means you have no remedy when the facts on the project don’t match what you were told. Document schedules received, changes in sequencing, directives to accelerate, disputed backcharges, predecessor problems, and additional work when they occur. The subcontractor in Commercial Painting was able to pursue an intentional misrepresentation claim even though the parties had a sophisticated written subcontract containing broad limitations on damages.

The bottom line: Your contract matters. A lot. But your project record matters too. Contracts allocate risk when projects don’t go according to plan. They don’t necessarily provide a shield when the documents, emails, schedules, and internal communications tell a very different story. Sometimes the most important exhibit in a construction dispute isn’t the contract. It’s the email someone wishes they hadn’t written.