Construction projects can experience delays for various reasons. Occasionally, delays may occur due to actions taken by the contractor themselves, which typically do not authorization a claim against the employer. Whether or not a contractor can file a claim for a specific delay event depends on several factors:
Adherence to Contract Documents:
Delays resulting from causes explicitly outlined in the contract documents are not usually claimable. Contract documents often specify potential delay events that the contractor must consider. If these events are clearly defined, the contractor cannot later argue that these events caused delays, unless they were more severe than initially described in the contract documents.
Critical Path Analysis:
The ability to make a claim for a delay event often hinges on whether it affects the project’s critical path. The critical path consists of tasks in the construction schedule that forms the shortest path from project start to completion. Delays to critical path tasks directly impact the project’s overall timeline.
- For example, consider the construction of a house, which involves various tasks like laying the foundation, building walls, installing the roof, and finishing touches. If, for example, the roof installation experiences a delay, it would hinder the overall completion of the house. Now, within the scope of this house construction project, there might also be a perimeter wall planned around the property. The contractor could choose to commence this wall construction at the project’s outset to enhance security.
- However, it’s crucial to note that the house’s construction can proceed independently while the perimeter wall is being built. In terms of the project schedule, the construction of the perimeter wall can start at virtually any point in time; as long as it’s finished before the house itself is completed.
- To illustrate, suppose the house’s construction schedule spans 40 weeks, and constructing the perimeter wall is estimated to take 2 weeks. In theory, the wall could commence as late as week 38 without causing a delay to the entire project. So, even if the original construction schedule indicated that the wall should start in week 1, and the necessary information for the wall’s construction arrived in week 15, with an additional 2 weeks required for material procurement, it’s evident that the perimeter wall could still be completed well before the project’s overall conclusion.
- While this sequencing might inconvenience the contractor, potentially necessitating temporary security measures like fencing and impacting resource allocation, it does not justify a claim for an extension of time since the wall is not critical to the project’s timeline. Nevertheless, the contractor might have valid grounds to submit a variation claim for reasons previously outlined.
However, it should be noted that an item that was not on the Critical Path can be delayed to such an extent that it now becomes Critical.
- As an illustration, consider the prior situation: in the aforementioned case, when the essential information needed for constructing the perimeter wall was received at the conclusion of week 38, and the procurement of materials consumed a span of 2 weeks, it becomes evident that the completion of the perimeter wall within the original project timeline, ending at week 40, is no longer feasible. Accounting for the 2-week duration required for material procurement and an additional 2 weeks for wall construction, the project is now expected to conclude 2 weeks later than initially planned. Consequently, the contractor is entitled to a 2-week Extension of Time.
Impact on Critical Path Tasks:
The delay event must affect tasks on the critical path. For example, if certain activities can proceed independently without delaying critical path tasks, the contractor may not be entitled to an extension of time claim.
- As an illustration, in the situation described above, the contractor may not need to know the paint colours until just a day or two before the painting work is scheduled to commence – a point that might arise after week 30. In some cases, the contractor could make a request for the paint colours as early as week 2, only to receive them by week 29, yet this delay does not affect the progress of the work. However, if the construction site is located in a remote countryside area, far from a paint supplier, the contractor might necessitate knowing the paint colours a week in advance of the painting start date (rather than just a day before, as might be the case in an urban setting) to accommodate the transportation of paint from the city to the project site.
It should be noted that sometimes abnormal weather events occur (say heavy rain) which don’t actually impact the project (or certainly not the Critical Path activities), because the activities are within a weather proof environment.
- For example, when constructing a new rail tunnel, the tunnel boring machine is typically unaffected by heavy rain unless it leads to a flooding of the tunnel itself. In such a scenario, tunnel boring becomes an integral part of the Critical Path. While heavy rain could potentially disrupt activities outside the tunnel, if the rain-induced delay is not significant enough to elevate these activities to a Critical Path status, the contractor is unlikely to have grounds for filing a weather-related delay claim.
Unforeseen Events:
Delay events must be unexpected and outside the contractor’s control something that could not have been foreseen or planned for at the project’s outset.
- For example, let’s consider a scenario where the region typically receives 50mm of rain over 4 days in May. However, during the construction of the project, there was an unusual occurrence of 100mm of rain over 8 days in May. If these rain-induced delays impacted activities on the Critical Path, the contractor should have a valid basis for submitting a claim for 4 of those days, which represent the excess rain days beyond the usual May conditions.
- It’s worth noting that if the project encounters 4 days of rain in June, but the typical regional average for June is 6 days of rain, the employer may argue that the 4 days claimed by the contractor in May could be balanced out by the 2 days of better weather conditions in June.
- However, it’s essential to emphasize that the employer cannot reduce the overall project duration simply because the contractor experienced more favourable weather conditions than expected. In the provided example, if June experiences no rain, the employer may offset the 6 days of better-than-expected weather in June against the 4 days of adverse weather in May and reject the contractor’s claim for a 4-day Extension of Time. Nevertheless, they cannot file a claim against the contractor for a 2-day reduction in time, which would be the result of subtracting the 6 days of additional good weather in June from the 4 days of adverse weather in May.
Exclusions in Contract Documents:
Some contract documents may explicitly exclude certain events from being claimable, such as extreme weather conditions or natural disasters.
Awareness and Disclosure:
The employer must be made aware of the contractor’s requirements for information and materials well in advance of their scheduled need. Failure to provide such information or materials on time may authorization of a claim.
Work Stoppages and Strikes:
Delays caused by work stoppages or strikes by the contractor’s workers or subcontractors may only be claimable if they were part of a national work stoppage that the contractor could not have mitigated or avoided.
Material and Equipment Shortages:
Delays due to material or equipment shortages may be claimable if they result from national or significant regional events beyond the contractor’s control.
Concurrency of Delays:
No other delays must have already impacted the task in question. Claims cannot be made for the same delay twice.
Unforeseeable Hindrances:
The delay must result from something the contractor could not have reasonably foreseen at the project’s outset, taking into account site conditions and local factors.
- For example, if it is evident that rock exists on the project site or in neighbouring areas, the detection of rock during construction cannot serve as a valid basis for requesting an Extension of Time. It’s important to note that the extent of research expected from the contractor during the tender stage is not always clear-cut. Certainly, contractors cannot be reasonably expected to conduct an extensive geological survey of the project site as part of their initial bid. Therefore, if rock is encountered during construction, significantly affecting the contractor’s progress, and this rock was not visibly present on the project site during the pricing phase, nor highlighted in the employer’s pricing documentation, it provides a legitimate reason for the contractor to initiate a claim for an Extension of Time as well as additional compensation for the unexpected costs incurred in excavating the rock.
Consequential Delays:
Generally, consequential delays, where the initial delay causes further delays or damages, are not claimable.
Contractors should exercise caution when considering claims and seek expert advice when unsure. While some claims may be legitimate, making baseless claims can impact the contractor’s credibility, especially when legitimate variation claims arise in the future. Each contract may have unique terms, so understanding the specific contract documents is essential for determining claim eligibility.
