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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.