Extension of Time Claims in Hong Kong

This was a talk given to the Hong Kong Institute of Construction Managers on
18 November 2004. It was updated in August 2006.

Introduction
Delay claims are one of the most common areas for disputes in Hong Kong within
the construction industry. Despite this, there still appears to be uncertainty
about:

1. what to claim;
2. when to claim; and
3. how to claim.
Delay claims, even the approach in the law, seem to be more theoretical than
practical. The purpose of this paper is to set out a practical approach to these
three questions. After a very brief overview of the legal background, I will
identify the relevant provisions from two standard forms building contracts,
commonly used in Hong Kong, which are the Hong Kong Government General
Conditions of Contract for Building Works and the HKIA/RICS Building Contract.
I will explain some of the main problems with extension of time claims,
particularly issues of concurrency and causation and demonstrate how the two
standard contracts deal with these issues in different ways.

A: What to Claim
The starting point is the contract and the extension of time clause itself. In this
section, I want to emphasise two points:

1. The importance of clear drafting, which sounds obvious, but it is bad drafting that
is the cause of so many problems.
2. The second point is less obvious. Restricting the grounds for extensions of time
in an extension of time clause may not be in your best interests.
Generally construction contracts have long complicated clauses dealing with
extensions of time and dates for completion. The clause will specify either a
precise date for completion or alternatively a length of time in which the Works
must be completed. If no time is specified in the contract, the Contractor will be
under an implied obligation to complete the contract works within a reasonable
time1.
Contracts also usually state that where the Contractor fails to complete the
Works by the date for completion, he will be liable for liquidated damages. If the
contract does not include a liquidated damages clause, an employer can still
claim general damages for delay. The exact wording of the liquidated damages
provision needs to be reviewed. Some contracts are written on the basis that
liquidated damages are the only remedy and some are written on the basis that
where general damages are higher, general damages could be claimed instead,
subject to proof. Be careful when amending standard contracts, however. The
case of Temloc v Errill Properties 2 is a warning.
In that case, the Employer was required to state the figure for liquidated
damages for delay in the appendix to the standard form contract. The figure
inserted in the appendix was nil. The Contractor was delayed in completing the
works and there was a dispute. The court considered that on a proper
construction of the contract, the parties had agreed that there should be no
damages for delayed completion. It was held that as the contract stated that
liquidated damages provided the only remedy for delay and the appendix was
expressly completed to provide for nil liquidated damages, no damages were
payable at all.
Where the Employer by its actions or omissions prevents the Contractor from
completing the works by the date for completion and where the extension of time
provision does not cover the delay, the Employer is unable to claim liquidated
damages. This is, of course, the main reason for the inclusion of an extension of
time clause within a construction contract. Its primary purpose is to allow the
Employer to extend time for completion by the Contractor as a result of any of
the delays listed in the extension of time clause, so that rights to claim
liquidated damages are not defeated by the Employer’s own actions.

This principle that the Employer cannot rely upon liquidated damages clauses, if
it has by its own actions prevented the contractor from completing the works as
known as the Prevention or Peak principle 3. It is from the case of Peak v
McKenney Foundation Ltd 4. The prevention principle is a simple concept and was
summarized well by the Australian court in Turner Corp v Co-ordinated Industries 5.
“Essentially it is that a party to the contract has been prevented from fulfilling its
contractual obligations by virtue of the conduct of the other party.”
In the Peak case, Peak was the head contractor and contracted with
the Liverpool Corporation to carry out building works.McKenney was the
nominated sub-contractor for the foundations. In early 1964, it was discovered
that there was a fault in the building’s perimeter piles. Delays, mainly caused
by the Liverpool Corporation meant that an expert was not engaged to review the
problem until February 1965. The expert produced its report to the parties in May
1965. The next day, Peak wrote to the Liverpool Corporation asking for an
instruction to carry out the work recommended by the expert. Peak heard
nothing from the Liverpool Corporation and therefore wrote to them again in
June. It was not until 30 July 1965 that the expert’s recommendations were
approved by the Liverpool Corporation and Peak began remedial work on 12
August 1965. In total, the works were suspended for 58 weeks.
The Liverpool Corporation sought liquidated damages from Peak and Peak in turn
sued McKenney for liquidated damages. The Court of Appeal held that the
Liverpool Corporation was not entitled to recover liquidated damages from Peak
because at least part of the 58 week delay was caused by the Liverpool
Corporation itself. The extension of time clause in the head contract did not
enable the Liverpool Corporation to extend time for its own delays. In fact, no
attempt had been made by the Liverpool Corporation to extend time at all.
Therefore, there was no date from when liquidated damages could commence.
The court said:
“A clause giving the Employer liquidated damages as so much a week or month which
elapses between the date fixed for completion and the actual date of completion is
usually coupled, as in the present case, with an extension of time clause… If a failure to
complete on time is due to the fault of both the employer and the contractor, in my
view, the clause does not bite. I cannot see how, in the ordinary course, the employer
can insist on compliance with a condition if it is partly his own fault that it cannot be
fulfilled”.6
For the prevention principle to apply, all that is required is the act or omission of
the Employer (or its agents) preventing the Contractor from completing the
Works by the specified time.
Even the ordering of a variation which prevented the Contractor from
completing on time has been held to be an act of prevention, leading to the result
that the employer could not claim liquidated damages. That is the Australian
case SMK Cabinets v Hili Modern Electronics Pty Ltd.7
If the prevention principle applies, the date for completion will be set aside
and time is said to be at large. What that means is that the contractor has a
reasonable time to complete and that the liquidated damages provision will not
apply. If the extension of time clause does not give the contractor the right to
claim an extension of time for all possible causes of delays by the Employer,
there is a risk that the right to claim liquidated damages will be set aside.
I want to demonstrate what I have said by reviewing the grounds upon which
Contractors can claim extensions of time under two Hong Kong standard form
contracts.

In an appendix to the written paper that I have prepared, I have set out the
extension of time clauses in full. I will not go through each ground for an
extension of time individually. That will take a few hours in itself. However, I will
refer to the main provisions and raise issues for you to think about.

I will start with the Hong Kong Government Form General Conditions of
Contract for Building Works – 1999 Edition. Clause 50(1)(b) sets out the grounds
for an extension of time claim. There are 11 grounds altogether. I will mention
only 6, which are:
1. Inclement weather and/or its consequences adversely affecting the progress of
the Works;
2. variations under Clause 60;
3. a substantial increase in the quantity of any item of work;
4. not being given possession of the Site or subsequently being deprived of it:
5. a disturbance to the progress of the Works, for which the Employer or the
Architect or Specialist Contractor is responsible; and
6. “any special circumstance of any kind whatsoever”.
The grounds upon which Contractors can claim extensions of time under this
Government form are fairly extensive. As a result therefore, the Government is
well protected against the possibility that an act of prevention might set aside
its right to claim liquidated damages. However the wording is not without
problems. For instance the ground for an extension of time for variations, only
applies tovariations under Clause 60. The right to issue variations is not without
limit. If it can be shown that the Contract Manager has exceeded his authority
and as a result Clause 60 does not apply, then there is a strong argument that
the extension of time clause also does not apply and the Employer cannot claim
liquidated damages. The ground in sub clause (v) which allows an extension of
time if there is a substantial increase in quantities comes partially to the
assistance of the Government here.
Further, the last ground “any special circumstance of any kind whatsoever”
seems very unclear. This wording reflects similar wording in the FIDIC and ICE
contracts and surprisingly, there is very little legal authority as to what it might
mean.

The word “special” implies “of a particular kind, not general or exceptional in
amount degree or intensity”. Therefore any delay which is caused by something
common will not be covered by this clause. Presumably the clause covers any
special risks, which are accepted by the Government under Clause 84, but given
that the terms ‘special circumstance’ is a different term than special risks, then
it is likely to have a different perhaps wider meaning.

There is further confusion caused by Clause 50(1)(c). This seeks to confirm

what the Contractor cannot claim an extension of time for. Specifically it states
that the Contractor cannot claim for:
1. a suspension to the Works described in Clause 54(2)(a) to (d) – the most
important of which is suspension caused by the default of the Contractor; or
2. a shortage of Constructional Plant or labour.
The problem with clauses which confirm what the Contractor cannot claim for is
not what they say, but which they leave out. For instance, this clause confirms
that the Contractor cannot claim an extension of time for shortage of
Constructional Plant or labour, but there is no mention of whether or not the
Contractor can claim an extension of time for a shortage of materials. Can a
Contractor argue therefore that a shortage of materials was caused by a
“special circumstance”, then he can claim an extension of time? Further if the
materials are being imported and if as a consequence of inclement weather
either in the country of origin or during transit, there is a delay to the progress of
the works, can the contractor claim an extension of time?
The HKIA/RICS standard form of contract has very different wording. Clause 23 is
the extension of time clause. It also sets out 11 grounds to claim an extension of
time. Again I will mention 6 grounds.

 force majeure;
This is very unclear. This term is not at all defined in the contract and would
encourage anyone using this form of contract to include a good definition of
force majeure.
 inclement weather or the subsequent effects of such inclement weather – which
is expressly defined;
 civil commotion, strikes and lockouts affecting any of the trades employed upon
the Works;
 variations under the contract;
Again – note that only variations under the Contract allow an extension of time.
Any additional work claims which are properly quantum meruit or outside the
contract would set time at large.

 delays by the Architect in providing instructions, drawings, details or levels;

 delays by artists, tradesmen or others engaged by the Employer.
Unlike the Government form contract, there is no general provision which states
that a default by the Employer will allow the Contractor to claim an extension of
time. In my view, this is a mistake. Similarly, the clause allowing a Contractor to
claim an extension of time as a result of delays by the Architect is very narrowly
worded. This allows the Contractor to claim an extension of time only if it is not
received in due time.

“necessary instructions, drawings, details or levels”

When reviewing this clause, it should be borne in mind that the extension of time
provisions should be strictly interpreted.8 I can only presume that this clause
was written in this way because it was assumed that when the contract was
signed, the Contractor would have a full design and that the only elements of the
design that he would still need would be details. However I have seen this clause
used in a fast track design and build project, where the Contractor had extremely
limited design details at the outset. It is clearly inapplicable in those
circumstances.
It is not difficult to think of other things which the Architect has to provide which
could be a cause of delay. For instance, would approvals be included? Possibly.
How about an entire sub-contract specification? Bear in mind that the extension
of time clause must be interpreted strictly.

Unfortunately case law does not provide answers to these questions. However
the lesson to be learnt is that the clause should be clearer.

Invariably, Clause 23 is amended by consultants acting for the Employer. It is

usually the case that the amendments restrict the grounds upon which a
Contractor can claim an extension of time. Although Employers and their
consultants see a benefit in restricting these grounds, it is important to take
great care.

Ultimately, if the extension of time clause is not properly drafted and an act of
prevention occurs, then the Employer will not be able to claim liquidated
damages and the whole purpose of the extension of time clause will be lost.

B: When to Claim
Often, extension of time clauses require the Contractor to claim an extension of
time within a specified period from the date that the cause of the delay arose.
These contracts seek to prevent the Contractor from claiming an extension of
time at all for a delay unless he claims within that specified time. These are
called condition precedents. These clauses must be sufficiently clear to be
enforceable.9
The case of Might Foundate Development Limited v CCECC (HK) Ltd 10 provides a
lesson on amending contracts. In that case, the extension of time clause was
amended by two separate Special Conditions, one of which was intended to
impose a condition precedent on the Contractor. The arbitrator decided that
these two special conditions were inconsistent and therefore on a contra
proferentem reading of the contract, did not act to impose a condition precedent
on the Contractor.
A good example of a well written condition precedent clause is Clause 45 of the
KCRC Standard Conditions, which requires any Contractor claiming an extension
of time to give notice of any delaying event within 28 days after commencement
of the event. Clause 45.11 states that the Contractor as a condition precedent to
being granted, extensions of time claims must strictly comply with this time
limit.

However, even if the notification clause is not written as a condition precedent,

contractors must claim within the times specified in the contract. The failure to
do so is a breach of contract.11 Also there is an important practical point.
Your claim is only as good as the evidence that you have got to support. You
could have the best contractual argument in the World, but without evidence, it
is not worth anything. The MTRC and KCRC contracts require the provision of
information within set time limits. This is clearly a good idea for both sides. If
properly managed it should facilitate the early resolution of claims. The difficulty
with some provisions is that they seem to add an administrative burden without
there being any particular benefit. For instance the KCRCcontracts require
update information to be provided every 28 days during long delays or where the
delays are not ascertainable.

Obviously the starting point for this 28 day period will be different for each claim
and if this provision is followed to its logical conclusion then the contractor will
very shortly after the start of the project, be submitting updates on different
claims every day. It would be much easier if the contract required the Contractor
to provide all the updates for all claims in one document in table form at the end
of each month. We have some success in persuading engineers to accept this.

Condition Precedents are very common in Hong Kong and abroad and attempts
have been made to get round them. There have been two recent approaches.

1. Using the Prevention Principle

The Australian case of Gaymark Investments Property Ltd v Walter Construction
Group 12 concerns a claim by the Contractor for an extension of time where the
Contractor failed to comply with the condition precedents for making claims. In
that case, the Contractor was required to construct a hotel, retail and office
complex. The Employer delayed the Contractor.
The contract stated that the Contractor shall only be entitled to an extension of time for
practical completion … where the Contractor has strictly complied … with its obligation
to give notice in writing of a delaying event within 14 days after the cause of the delay
first arising.
The Employer attempted to claim liquidated damages for the delay. The claim
was first decided by an arbitrator and then ultimately ended up in the Northern
Territories Court of Appeal. The Court decided that it was clearly wrong to allow
the Employer to claim liquidated damages for its own delays and refused to allow
the claim.

The Court of Appeal agreed with the arbitrator that:

The contract between the parties fails to provide for a situation where [the Employer]
caused actual delays to [the Contractor] achieving practical completion coupled with
the failure by [the Contractor] to comply with the notice provisions.
One key issue which appears to be at the heart of this decision is the fact that a
clause which is common in Australian Contracts, which allows a contract
manager to extend time, even without a claim from the contractor, was deleted
from the contract.

2. The Penalty Argument

In the Scottish case of City Inn Ltd v Shephard Construction Ltd 13, the Contractor
was delayed in reaching completion. The Contractor argued that it was entitled
to an extension of time as a result of instructions given by the Architect. The
Contractor set out a strict time limit for extension of time claims and clearly
stated that the Contractor was not entitled to any extension of time if it does not
claim in time.
The Contractor admitted that it failed to claim within the time frame but argued
that the condition precedent acted as a penalty. In other words, the condition
precedent set out a contractual provision that the contractor had breached. The
result of the breach is a liability to liquidated damages, which is out of all
proportion to the damage suffered by the Employer.

However the Court of Appeal in Scotland (the Outer Court of Session) did not
accept that argument. They said that the Contractor’s liability for liquidated
damages does not result from a failure to comply with the notification provision
but from the failure to complete on time. The failure to comply with the
notification provision does not itself require the contractor to pay liquidated
damages but instead leads to the mere possibility that liquidated damages may
become payable at a later date.

C: How to Claim
Causation
Now that the Contractor has made a claim, we now need to consider how
extensions of time are to be assessed i.e. what is the period of delay. Again,
there is a degree of obscurity because of the grant of extensions of time cannot
be a precise science. There are difficulties of overlapping, accumulative and
concurrent delays. Delays caused by variations could take place at the same
time as delays caused by labour or material shortages.

I wish to deal with two main issues, which are:

1. issues of causation; and

2. court decisions which have commented on the approaches to assessing the
extensions of time.
The starting point though is what is the legal test for causation? The leading
case is not a construction case, but is in fact a case involving damage to a ship
during the First World War. In Leyland Shipping v Norwich Union Fire Insurance
Society 14, the House of Lords had to decide what caused a ship to sink. The
facts were these:
1. On 30 January 1915, the ship was torpedoed by a German submarine. It was hit
by two torpedoes. The crew abandoned the ship immediately believing that it was
about to sink and boarded a tug boat.
2. However the ship did not sink. The tug boat was able to tow the ship into a
nearby port of Havre. However, a storm began and the seas became rougher. The
ship started hitting the side of the dock.
3. The Harbour Master fearing that the ship might sink, required it to be towed to
outside the inner walls of the harbour. The ship was moored outside of the harbour
near the break water.
4. During the next two days, the storm continued, during which time the ship ran
aground and on high tide re-floated. After two days of this constant battering, the
ship sank.
5. The owners of the ship made a claim on the insurance. The Insurers rejected the
claim on the basis of an exclusion which excluded losses caused by war and
hostilities.
The court had to decide the cause of the loss. There were several competing
clauses. Taking them in date order, they were:

1. the torpedoes;
2. the ship hitting the side of the dock;
3. the decision of the Harbour Master to require the ship to be removed from the
inner harbour;
4. the effect of two days of the ship hitting the ground; and
5. the storm.
One issue of fact found by the court was that had the ship remained in the port,
i.e. if the Harbour Master, did not require the ship to be removed, then it would
not have sunk. However, the court decided that the cause of the loss was the
torpedoes.

All of the other potential competing clauses were taken to have flowed from the
initial damage from the torpedoes. One crucial factor in that decision was that
given the importance of Havre as a port during the war and the concern that the
ship could have sunk, the Harbour Master’s decision could not be faulted.
In legal terms, it is said that the torpedoes were the “proximate” or “dominant”
cause of the loss.

There has previously been some discussion about an English case, which
doubted whether the dominant cause approach was the right approach for
construction claims. In H Fairweather & Co Ltd v London Borough of Wandsworth 15,
the court rejected the dominant cause approach as not being the correct
approach without stating an alternative.
However, the recent decision of Laing Management (Scotland) Ltd v the John Doyle
Construction 16 case has confirmed that normal principles of causation should be
taken into account for construction claims. Before discussing the Doyle decision,
I want to mention concurrency very briefly.
Concurrency and competing causes
There is often some confusion over the effect of competing causes and to what
extent delays, which overlap, can be claimed. The complex relationship between
various site activities makes the factual analysis very difficult. Again the starting
point is the Contract.

Under the RICS Contract, the Architect can only award an extension of time to
the extent that completion of the Works is delayed or is likely to be delayed by
one of the grounds stated in that clause. Under the Government Form of
Contract, delay to progress of the works is the key. The Contractor is not
required to show that the completion date itself is affected, if he can show a
delay to progress as a result of one of the grounds listed in Clause 50 (1).

In either case however the Contractor must show a causal link between the
cause of the delay and the effect of the delay. The decision of Henry Boot v
Malmaison 17 emphasised that delay is really a question of fact and that to show
the time cause of the delay, you must show that the delay was on the critical
path. To give a very simple example, if there is a 1 week delay because of a
failure to give the Contractor the possession of the site and during the course of
that week, there is a day of inclement weather which would have stopped work,
the contractor cannot claim an extension of time for the inclement weather
unless it adds to the delay. Quite simply the inclement weather has not caused
any delay.18 Although you might say that as the contractor can claim anyway, it
does not matter. However the entitlement to claim prolongation costs might
depend upon the cause of the delay and therefore the real cause of the delay
could be critical.
The Hong Kong contracts do not deal with issues of concurrency very well. This
approach is in sharp contrast to Australia, where the standard forms give the
contract manager an obligation to apportion delays to respect causes if there are
overlapping delays.19
Global Claims
It is often difficult to separate the delay and costs incurred following any
delaying event. This is because there can be overlapping causes, such as
variations to one part of the works issued at the same time that there are delays
in providing drawings for a related part. Both the variation and the delay could
allow a claim for an extension of time, but the exact length of the delay from
each might be difficult to assess. Further it might be difficult to assess the
precise cost consequences of them.

The English case of Crosby v Portland UDC concerned a claim for an extension of
time and disruption costs. The contractor argued that it was not possible to
separate out the delay associated with each item but instead argued that they
were entitled to the total effect of the delays.
The court agreed and acknowledged that in that case, the extra cost claims
resulted from an extremely complex set of facts. As a result, it was difficult or
even impossible to make an accurate apportionment between the several causes
and that there was no need to make an artificial apportionment which had no
basis in reality. In such cases, a single lump sum award was proper, provided
there was no duplication.

Thus the concept of the global claim was borne and the approach was adopted
in Mertan v Leach. It was thought following these cases that contractors could
make global claims without the need to show that vital causal link that we have
just discussed. However it was not the case. As Lord Oliver said in Wharf v Eric
Cumine:
Those cases established no more than this, that in cases where the full extent of extra
costs incurred through delay depend upon a complex interaction between the
consequences of various events, so that it may be difficult to make an accurate
apportionment of the total extra costs, it may be proper for an arbitrator to make
individual financial awards in respect of claims which can conveniently be dealt with in
isolation and a supplementary award in respect of the financial consequences of the
remainder as a composite whole.
The recent decision of Laing v Doyle has paved the way for a common sense
approach to global claims. In that case, the claimant was a works contractor and
the defendant a management contractor. The works contractor brought a claim
against the management contractor for delay and loss and expense. The
management contractor sought to strike out the claim on the basis that it was
global and that no proper cause and effect was shown.

Both parties agreed that it was not possible to show a link between cause and
effect and its cost consequences. The court decided that to claim loss and
expense:

1. generally the Contractor must show that there is an event for which the employer
is responsible and a causal link to the loss and expense;
2. if the loss and expense results from a number of causes and the contractor can
show that all of the causes are the responsibility of the employer, it is not necessary
to show a causal link between individual events;
3. a global claim cannot succeed where any of the causes of the loss and expense
are the fault of the Contractor; but
4. however – and this is the good news for the contractors – if the global claim does
not succeed, then it does not mean that the contractor can claim nothing. It may be
possible to group claims using the dominant cause approach. It may also be possible
 to apportion the loss between causes attributable to the contractor and to the
employer.
The Laing v Doyle decision is a Scottish law decision. However it seems to me
that the principles are equally applicable in Hong Kong.

Appendix: Extension of Time Clauses in Standard Construction

Contracts In Hong Kong
The Hong Kong Government General Conditions of Contract for Building Works
[1999] – Clause 50
(1) (a) As soon as practicable but in any event within 28 days after the cause of
any delay to the progress of the Works or any Section thereof has arisen, the
Contractor shall give notice in writing to the Architect of the cause and probable
extent of the delay.
Provided that as soon as the Contractor can reasonably foresee that any order or
instruction issued by the Architect is likely to cause a delay to the progress of
the Works or any Section thereof the Contractor shall forthwith give notice in
writing to the Architect and specify the probable effect and extent of such delay.
Such notice shall not in any event be given later than 28 days after the Architect
has issued the relevant order or instruction.

(b) If in the opinion of the Architect the cause of the delay is:
(i) inclement weather and/or its consequences adversely affecting the progress
of the Works, or
(ii) the hoisting of tropical cyclone warning signal No. 8 or above, or
(iia) a Black Rainstorm Warning, or
(iii) an instruction issued by the Architect under Clause 5, or
(iv) a variation ordered under Clause 60, or
(v) a substantial increase in quantity of any item of work included in the
Contract not resulting from any error in firm quantities or from a variation
ordered under Clause 60, or
(vi) the Contractor not being given possession of the Site or any Portion or part
thereof in accordance with the Contract or is subsequently deprived of it by the
Employer, or
(vii) a disturbance to the progress of the Works for which the Employer or the
Architect or a Specialist Contractor is responsible including but not restricted to
any matter referred to in Clause 63, or
(viii) the Architect suspending the Works in accordance with Clause 54 in so far
as the suspension is not occasioned by the circumstances described in Clause
54(2)(a) to (d), or
(ix) any utility undertaking or other duly constituted authority failing to
commence or to carry out in due time any work directly affecting the execution
of the Works, provided that the Contractor has taken all practical steps to cause
the utility undertaking or duly constituted authority to commence or to proceed
with such work, or
(x) delay on the part of any Nominated Sub-contractor for any reason specified in
sub-clause (b)(i) to (ix) of this clause and which the Contractor has taken all
reasonable steps to avoid or reduce, or

(xi) any special circumstance of any kind whatsoever,

then the Architect shall within a reasonable time consider whether the
Contractor is fairly entitled to an extension of time for the completion of the
Works or any Section thereof.

(c) Notwithstanding the powers of the Architect under the provisions of this
Clause to decide whether the Contractor is fairly entitled to an extension of time
the Contractor shall not be entitled to an extension of time for the completion of
the Works or any section thereof if the cause of the delay is:
(i) a suspension occasioned by the circumstances described in Clause 54(2)(a)
to (d), or
(ii) a shortage of Constructional Plant or labour.
(2) If in accordance with the sub-clause (1) of this Clause the Architect
considers that the Contractor is fairly entitled to an extension of time for the
completion of the works or any section thereof, the Architect shall within a
reasonable time determine, grant and notify in writing to the Contractor such
extension. If the Architect decides that the Contractor is not entitled to an
extension, the Architect shall notify the Contractor in writing accordingly.
Provided that the Architect in determining any such extension shall take into
account all the circumstances known to him at that time, including the effect o
any omission of work or substantial decrease in quantity of any item of work.

Provided further that the Architect shall, if the Contractor shall so request in
writing, make a subsequent review of the circumstances causing delay and
determine whether any further extension of time for completion should be
granted.

(2A) For the avoidance of doubt if the Architect grants an extension of time in
respect of a cause of delay occurring after the Employer is entitled to recover
liquidated damages in respect of the Works or any Section, the period of
extension of time granted shall be added to the prescribed time or previously
extended time for the completion of the Works or, as the case may be, the
relevant section.
(3) For the purposes of determining whether or to what extent the Contractor
may be entitled to an extension of time under sub-clause (1)(b) of this Clause the
Architect may require the Contractor to submit full and detailed particulars of
the cause and extent of the delay to the progress of the Works. Where such full
and detailed particulars are required by the Architect, they shall be submitted in
writing by the Contractor to the Architect as soon as practicable in order that the
Contractor’s claim may be investigated at that time by the Architect. If the
Contractor fails to comply with the provisions of this sub-clause, the Architect
shall consider such extension only to the extent that the Architect is able on the
information available.
(4) Whenever the Architect grants an extension of time for completion in
accordance with this Clause, the Contractor shall revise the programme referred
to in Clause 16 accordingly.
(5) Except as provided elsewhere in the Contract, any extension of time granted
by the Architect to the Contractor shall be deemed to be in full compensation
and satisfaction for any loss or injury sustained or sustainable by the Contractor
in respect of any matter or thing in connection with which such extension shall
have been granted and every extension shall exonerate the Contractor from any
claim or demand on the part of the Employer for the delay during the period of
such extension but not for any delay continued beyond such period.
(6) For the purpose of this Clause “Black Rainstorm Warning’ means a warning
issued by the Director of Hong Kong Observatory of a heavy rainstorm in, or in
the vicinity of, Hong Kong by the use of the heavy rainstorm signal commonly
referred to as Black.
The HKIA/RICS Agreement and Schedule of Conditions of Building Contract
(Without Quantities) (April 1998)
Upon it becoming reasonably apparent that the progress of the Works is delayed,
the Main Contractor shall forthwith give written notice of the cause of the delay
to the Architect, and if in the opinion of the Architect the Completion of the
Works is likely to be or has been delayed beyond the Date for Completion stated
in the appendix to these Conditions or beyond any extended time previously fixed
under either this clause or clause 33(1)(c) of these Conditions.

(a) by force majeure, or

(b) by reason of inclement weather or the subsequent effects of such inclement
weather; for the purpose of this sub-clause “inclement weather” is defined as
rainfall in excess of twenty millimeters in a twenty-four hour period (midnight to
midnight) as recorded at the Hong Kong Observatory or the hoisting of Typhoon
Signal Number 8 or higher, or
(c) by reason of loss or damage occasioned by any one or more of the
contingencies referred to in clause 20(A) or (B) of these Conditions, or
(d) by reason of civil commotion, local combination of workmen, strike or lockout
affecting any of the trades employed upon the Works or any of the trades
engaged in the preparation, manufacture or transportation of any of the goods or
materials required for the Works, or
(e) by reason of Architect’s instructions issued under clauses 1(2), 11(1) or 21(2)
of these Conditions, or
(f) by reason of the Main Contractor not having received in due time necessary
instructions, drawings, details or levels from the Architect for which he
specifically applied in writing on a date which having regard to the Date for
Completion stated in the appendix to these Conditions or to any extension of
time then fixed under this clause or clause 33(1)(c) of these Conditions was
neither unreasonably distant from nor unreasonably close to the date on which it
was necessary for him to receive the same, or
(g) by delay on the part of Nominated Sub-Contractors or Nominated suppliers
which the Main Contractor has taken all practicable steps to avoid or reduce, or
(h) by delay on the part of artists, tradesmen or others engaged by the Employer
in executing work not forming part of this Contract, or
(i) by reason of the opening up for inspection of any work covered up or of the
testing of any of the work, materials or goods in accordance with clause 6(3) of
these Conditions (including making good in consequence of such opening up or
testing) unless the inspection or test showed that the work, materials or goods
were not in accordance with this Contract, or
(j) (i) by the Main Contractor’s inability for reasons beyond his control and which
he could not reasonably have foreseen at the date of this Contract to secure
such labour as is essential to the proper carrying out of the Works, or
(ii) by the Main Contractor’s inability for reasons beyond his control and which he
could not reasonably have foreseen at the date of this Contract to secure such
goods and/or materials as are essential to the proper carrying out of the Works,
or
(k) by reason of compliance with the provisions of clause 34 of these Conditions
or with Architect’s instructions issued thereunder.
Then the Architect shall so soon as he is able to estimate the length of the delay
beyond the date or time aforesaid make in writing a fair and reasonable
extension of time for completion of the Works. Provided always that the Main
Contractor shall use constantly his best endeavours to prevent delay and shall
do all that may reasonably be required to the satisfaction of the Architect to
proceed with the Works.

1. Charnock v Liverpool Corp [1968] 1 WLR 1498

2. [1987] 39 B.L.R.30
3. although the origins of the rule stem from Holme v Guppy (1838) 3 M & W
387
4. [1978] 1 BLR 111
5. (1995) 11 (3) BCL 2002
6. [1974] 1BLR 111 at 121
7. [1984] VR391
8. Peak v McKinney (1970) 1 BLR 111 per Salmon LJ
9. (footnote missing)
10. [2001] HKCFI 785 – 6 August 2001
11. although the Court of Session in City Inn Ltd v Shephard ([2003] SCLR
795) decided that a contractor would not be in breach of contract if after
receipt of an instruction from the Architect, it executed work without first
providing details of any claim, despite clear wording of the clause which on its
face required the Contractor to provide that information before carrying out
that work.
12. [2000] 16 BCL 449
13. [2003] SCLR 795
14. [1918] A C 350
15. 39 BLR 106
16. [2004] BLR 295
17. 70 Can LR 32
18. See Royal Brompton Hospital v Hammond (18 December 2000)
19. e.g. AS4902 clause 34.4