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Concurrent Delay – Deal With It!

You know that recurring argument your parents had when you were younger?

Parent 1: “If you hadn’t spent so long getting ready we wouldn’t have been late.”

Parent 2: “Well maybe if you had known where we were going we would have got there on time.”

We often argue over ‘time’ and whose fault it is when we are late.

But what if there was another way? What if we agreed in advance what was to happen when we were both running late? Seems simple I know.

What is concurrent delay in the context of construction contracts?

Concurrent delay refers to the situation in which a period of delay is caused by two events, one which is identified in the building contract as a contractor’s risk and the other as an employer’s risk. To achieve concurrency, it is necessary that the consequences of the two events are felt at the same time (that is, that the delays are felt concurrently).

Standard position

The standard form contracts (JCT, NEC3 and FIDIC etc.) do not deal with concurrent delay.  This causes problems.  Subjective arguments often ensue from both employer and contractor as to why/why not the contractor should be afforded an extension of time.  As the dispute heats up, people start bandying around the names and outcomes of legal cases like “Henry Boot”, “City Inn” and “Walter Lily”.  Approaches adopted by the court have varied from granting an extension of time commensurate only with the employer created delay, and alternatively apportioning the delay fairly between the parties and subsequently granting an extension of time based on the apportionment principle.   The outcome of your particular disagreement may be uncertain due to the myriad of different approaches the courts have adopted in a number of different cases.   

A different way

There is however a different way, a way which ensures you are in complete control. 

Come to an express agreement as to how concurrent delay is to be dealt with in your contract.  That’s it. 

The recent case of North Midland Building Ltd v Cyden Homes Ltd [2017] has provided welcome guidance in this area.  The case concerned a contractor, an employer, and concurrent delays.  What was different though was that the parties had amended the standard form JCT contract to proactively address what was to happen in cases of concurrent delay:

“…any delay caused by a Relevant Event which is concurrent with another delay for which the Contractor is responsible shall not be taken into account.”

When the contractor challenged the clause in a bid to seek relief and ultimately an extension of time, the judge ruled that the wording above was crystal clear – i.e. where there was a concurrent delay, the contractor had no right to claim for an extension of time.  Whether or not you think the above clause is fair or just, the approach taken by the court is a timely reminder that it will enforce what two parties have agreed, and it will not reverse a ‘bad bargain’.

Whilst some parties may choose to defer to the common law approach, we increasingly recommend addressing the issue of concurrent delay in your contracts.  The common law approach continues to evolve and brings with it a great degree of uncertainty, not to mention legal costs in pursuing or defending disputed time claims.  There is far greater value in maintaining control and contracting for how concurrent delay will be dealt with from the outset.

Regardless of what your contracts might say about delay or concurrency, we are excellently placed to advise you (with the assistance of experts if needed) to manoeuvre through even the most complex of delay claims.  We are true construction specialists, experienced in drafting and negotiating contracts based on all of the major standard forms.  We act for clients across the industry and at all stages of the construction process.

For any queries in relation to this article or for further advice on drafting your construction contracts, please contact Adrian Kerr, Director and Head of Construction at Mills Selig.  

Article by Patrick McIlroy and Adrian Kerr 

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