There are often many complications during construction projects, regardless of the size of the project. Examples of such complications include claims in respect of an extension of time and loss and expense.
Often, in standard forms of contract, the events which trigger an entitlement for the contractor to claim an extension of time and loss and expense are often the same; however, not always. For this reason, it is important for both these rights to be kept separate.
A claim for an extension of time is an attempt to invoke rights under the contract. When seeking an extension of time a contractor is exercising his contractual rights.
An extension of time can be granted pursuant to the terms of the contract for events which would not normally relieve a contractor from performance. An example of this, is clause 2.20.8 of the JCT Intermediate Building Contract with contractor’s design 2011; ‘exceptionally adverse weather conditions‘. Without the inclusion of this term, exceptionally adverse weather conditions would be at the contractor’s risk.
Where a bespoke form of contract is being used by the parties, it is advisable for provisions in respect of extension of time and loss and expense to be incorporated into the contract, similar to those found under a JCT. This will ensure that a contractor, provided they comply with any relevant notice provisions under the contract (as below) may seek to claim an extension of time.
A contractor, when seeking to exercise this contractual right must comply with any relevant notices under the contract. An example of such notice is clause 2.19.1 of the JCT Intermediate Building Contract with contractor’s design 2011:
‘If and whenever it becomes reasonably apparent that the progress of the Works or any Section is being or is likely to be delayed the Contractor shall forthwith give the Architect/Contract Administrator notice of the cause of the delay. If in the Architect/Contract Administrator’s opinion completion of the Works or Section has been, is being or is likely to be delayed beyond the relevant Completion Date by any of the Relevant Events, then, save where these Conditions expressly provide otherwise, the Architect/Contract Administrator, as soon as he is able to estimate the length of the delay beyond that date, shall be notice to the Contractor give a fair and reasonable extension of time for completion of the Works or Section.’
If the contractor fails to give notice ‘forthwith’, this may be a breach of contract but the contractor still has the option to exercise its right under common law and claim general damages for breach by the employer.
If a contractor fails to comply with the requisite notice provisions under a contract in respect of loss and expense, the contractor can pursue a common law claim for breach of contract outside the contract, rather than making a claim for loss and expense under the contract.
For example, if the employer has failed to give possession of the site to enable the contractor to commence works on time then, the contractor can:
- Make a claim for adjustment of the completion date under the contract (provided the contract provides for such a right, for example under the JCT); or
- Claim beach of contract by virtue of the employer hindering the contactor from carrying out the works.
Notices do not have to be given for claim for breach of contract outside the contract.