Who is ultimately responsible for incidental and consequential damages?

The correct answer is that the Contractor is responsible for incidental and consequential damages. This accountability is often due to the nature of contractual agreements, where the contractor typically assumes responsibility for various risks associated with the project's execution. This includes any unexpected costs or issues that arise from their work, which are classified as incidental and consequential damages.

In this context, incidental damages refer to secondary costs that may occur as a direct result of a contractor's failure to fulfill their obligations. Consequential damages extend to losses that may not have occurred directly due to the contractor's actions but are a result of those actions, like lost business or additional expenses incurred by the project owner.

Given the legal framework within which these agreements operate, the contractor generally has a duty to ensure not only compliance with the contract terms but also to mitigate any potential damages that could arise during the project. By assuming this responsibility, contractors encourage a high standard of performance and accountability in their practices, which ultimately protects all parties involved in the agreement.