Professional Documents
Culture Documents
See also: International research into the causes of delays on construction projects .
Contents
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1 Introduction
2 Types of delay
3 Delays resulting from neutral causes
4 Delays that are the fault of the client
5 Delays that are the fault of the contractor
6 Concurrent delay
7 Compensation events
8 Early warning
9 Mitigation and acceleration
10 Find out more
Introduction
In Modernising Construction: Report by the Comptroller and Auditor General, published in 2001, the
National Audit Office found that 70% of government construction projects were delivered late.
Types of delay
Delays in activities for which there is programme float available (i.e. they can be delayed
without impacting on the completion date).
Delays that will impact on the completion date.
Neutral events (which may be 'relevant events'), which are not the fault of either party might entitle
the contractor to an extension of time. Typically, this might include:
This does not necessarily entitle the contractor to claim loss and expense.
These matters (described in some contracts as 'relevant matters') may also constitute 'relevant
events' allowing the contractor to claim an extension of time, however a relevant matter need not
necessarily result in a delay to the completion date, and so claims for loss and
expenseand claims for extensions of time do not necessarily always run together.
Where a delay which impacts on the completion date is caused by the contractor, thecontractor will be
liable to pay liquidated and ascertained damages (LADs) to the client.
Concurrent delay
Concurrent delay refers to the complex situation where more than one event impacts on
thecompletion date at the same time, but where not all of those events would entitle
thecontractor to claim an extension of time or loss and expense.
Some form of apportionment is likely here, however such situations are complex and each case will
tend to have circumstances that are unique in some way. What is clear is that it is important for both
parties to ensure they keep good records to demonstrate that the event did actually occur and that it
did impact on the completion date.
If it is possible to carry out a critical path analysis that demonstrates the effect of events on
the completion date, then this is beneficial, however, in the absence of such information it is likely that
the courts will take a ‘common sense’ approach.
Compensation events
NEC contracts deal with these issues under the single heading ‘compensation events’. They do not
treat compensation events as an allocation of blame, but rather an allocation of risk. Any risk that is
not specifically identified as being attributed to the client is borne by thecontractor.
Early warning
When it becomes reasonably apparent that there is a delay, or that there is likely to be a delaythat
could merit an extension of time, the contractor must give written notice to the contract
administrator identifying the relevant event that has caused the delay.
On NEC contracts both parties must give early warning of anything that may delay the works. They
should then hold an early warning meeting to discuss how to avoid or mitigate impacts on the project.
The contractor is generally required to try to prevent or mitigate delay, even where the fault is not their
own.
If there is nonetheless a delay, the client may wish to instruct acceleration of the works.
Anacceleration agreement can be used as a “wrap up” agreement expunging all
outstandingclaims for extensions of time and loss and expense.