Concurrency in Delay Claims

7/31/2019 Concurrency in Delay Claims

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CONCURRENCY IN DELAY CLAIMS

WHAT DOES IT MEAN AND WHY DOES IT MATTER?

Mark Tiggeman

Partner

14 July 2010


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Overview

SOME DEFINITIONS

HOW DELAYS ARE ASSESSED

CASES ON APPORTIONMENT

WHY CONCURRENCY MATTERS?


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What is concurrency?

Societ y of Const ruct ion Law Delay andDisrupt ion Prot ocol def in i t ions

Oxf or d Dict ionar y: Act i ng i n conj unct i on;cooperat ing

For t oday compet ing causes of delay

ar ising dur ing a single per iod and causedby more than one event . Key factor is thatt ime delay is suffered, not when it occurs.


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How is delay assessed?

Cr i t i cal Pat h Met hod (CPM) - Traces t helogical sequence of t asks t hat dir ect l y

af f ect t he dat e of proj ect comple t ion

Cour t s expect CPM see Bal f our Beat t yConst r uct i on Lt d v The Mayor and Bur gessesof t he London Borough of Lambet h[2002]

EWHC 597 (TCC)


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Scot t ish cases on apport ionment

Ci t y Innv Shepherd Construction*

Works comple t ed over 11 weeks lat e

Archi t ec t awarded an ext ension of t ime of onlyt w o weeks

Employer w ant ed t o levy more t han 9 w eeks of

l iqui dat ed damages at 30,000 per w eek Cont ract or want ed t he fu l l ex tension of t ime plus

l oss and expense at 11,519 per w eek

*Ci t y Inn Lt d v Shepher d Const r uct i on Lt d [ 2007] CSOH 190


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In Ci t y Inn, t he concurrent causes of delaywere:

Contractor - lat e var iat ions or inst ruct ions issued by t hearchi t ect ; and

Employer - lat e or def ect ive work t o t wo areas of work

Not possib le t o do a cr i t ical pat h analysis of t he delay as

t here was not an appropr iat e in i t ia l program To w hat ext ent had t he gross delay been caused by t hedelays of t he employer and t he cont ract or?

Al l delays ident i f ied by t he par t ies w ere concurrent

causes of the gross delay

Cour t appor t i oned t he delays by refe rence t o common senseand a considerat ion of w hat w as f air and r easonabl e


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Tort v Cont ract

Tor t

Law i s r easonab ly clear Cl ai mant can r ecover i n f u l l i f he est abl ishes t hat t he cause f or

w hich t he def endant is l iable caused or mat er i al l y cont r ibut ed t o

hi s l oss*

Cont ract

Posi t ion less c lear and, t here fore, pot ent ial ly more d i f f i cul t

Cour t s reluct an t , p refe r t o rely on bargain of r i sk fo r Li qui dat e d dam ages Ext e nsi ons of t i m e Loss and expense

*Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32, HL


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Laing Management (Scot l and) Lt d v John DoyleConst r uct i on Lt d*

Laing claimed a 22 week ex tension of t ime and 4.8 mi l l ion inloss and expense

Cour t held: Where t he loss was caused both t he employer and by t he cont r ac tor ,

t hen t he cont ract or m ust est abl ish t he employer s delays are t he dominant cause o f t he loss simi lar t o posi t ion in tor t

Fol low ed in Maersk Oil UK Lt d v Dr esser -Rand UK Lt d i f an apport ionment , based on t he evidence is possibl e, al bei t

d i f f i cu l t , i t would be mani f est l y unj ust t o deny a remedy, w here t here ar e pla in cont r act ual breaches by t he def endant / employer. *

*Laing Management (Scot l and) Lt d v John Doyle Const r uct i on Lt d [ 2004] BLR 295

* [2007] EWHC 752 (TCC). See also: London Underground v Cit yl i nk Telecommuni cat ionsLt d [ 2007] EWHC 1749 (TCC) for f urt her support f or t he decision in John Doyle.


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Why does concurrency mat ter?

Di f f erent delays have di f f e ren t consequences fo r bot hemployers/ cer t i f iers and for cont ract ors

3 cat egor ies of del ay:

Compensable delay event s t hat ent i t l e t he cont ract ort o an ext ension of t im e and t o l oss and expense f or cost s

f lowing f rom t hat event

Excusable delay event s t hat ent i t le t he cont ract or t oan ext ension of t im e but w here t he cont ract or bears t her isk of addi t ional cost s t hat may f l ow f rom t hat event ;and

Culpable delay event s t hat do not ent i t l e t he cont ract ort o e i ther t im e or money


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Concurrent delay and extensions of t ime

For concur ren t de lays, t he employer s defaul t i s t o be causat i ve of t he delay .Ot herw ise t he employer could levy l iquidat ed damages w hen i t is in def aul t .See Peak Const r uct i on v McKi nney*

Henry Boot v Malmaison* Par t ies agreed posi t ion was t hat i f t here are tw o concur ren t causes of

delay, one of which is a re levant event , and t he ot her is not , t hen thecont ractor is ent i t led t o an ext ension of t ime f or t he per iod of delay causedby the relevant event not wi t hst anding t he concurrent ef f ect of t he otherevent .

Over ar ching pr inciple:

Cont rac to r al l owed an ex tension of t ime where t here are concur ren tcauses of delay one of w hich is i t s f ault and one of w hich is not .

* Peak Const r uct ion (Li verpool ) Lt d v McKinney Foundat ions Lt d 1 BLR 111

* Henr y Boot Const r uct ion (UK) Lt d v Malm aison Hot el (Manchest er ) Lt d (1999) 17 Con LR 32


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Concur rent delay and loss and expense

No overarching pr i nciple, w i l l depend on f act s:

Compensable delay + excusable delay= anapport ionm ent exercise should be carr ied outbased upon t he rel at ive signif icance of each event .

Compensable delay + culpable delay=apport ionm ent is unl ikely t o be appropr iat e. Thecont ract or i s only l ikely t o recover hi s l oss andexpense t o t he ext ent he can show t hat t hecompensable delay was t he dom inant cause ofdelay.


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Conclusions

Concurrent delays are t hose which ar ise dur ing a single per iod, caused bymore t han one event . It is t he t im e t hat t he delay is suf fered, and not t het ime t hat t he event occurs, t hat is key.

Delays are usual ly and best assessed by a cr i t ical pat h anal ysisandcont ract or should updat e t heir programm e.

Concurrency mat t ers because di f f erent de lays have d i f f erent consequencesf or cont ract ors and emp loyers and because ext ensions of t i me and loss andexpense cla im s ar e deal t wi t h ver y di f f erent ly i n const r uct ion cont r act s.

Cont ract ors w i l l be general l y ent i t led t o an ext ension of t ime where t hereare concur r ent delays, even i f one of t hose del ays is due t o his breach.

The Ci t y Innand John Doyl ecases decided i n Scot land have opened t he doort o an apport ionment w here t here are concurrent delays, but only f or l ossand expense cl aim s, not f or ext ensions of t ime.

The p roj ect own s t h e f l oat and it i s avai l ab le on a f i r st come, f i r st servedbasis.

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Concurrency in Delay Claims