HOW SHOULD A PRINCIPAL AGENT DEAL WITH REVISIONS TO THE DATE FOR PRACTICAL COMPLETION WHEN THERE ARE MULTIPLE CAUSES OF DELAY?
Clause 29.0 of the JBCC Principal Building Agreement deals with delays and revisions to the intended ate for practical completion.
Clause 29.1 and 29.2 both list causes of delay which can be called ‘excusable' delays for which the Contractor is entitled to an extension of time in which to complete the Works.
Clause 29.1 lists those causes which are excusable but for which the Contractor will receive no monetary compensation.
Clause 29.2 on the other hand lists those causes which are also excusable but for which he will receive monetary compensation for his additional costs because the risk of these classes of delay are carried by the Employer.
But what if 29.1 type causes of delay and 29.2 causes of delay occur at the same time and/or overlap with each other?
It is important to both Employer and Contractor that the Principal Agent grants extra tome under the correct clause because of the question of monetary compensation.
The Principal Agent has a duty under clause 29.7.3 to "identify each circumstance and relevant subclause for each revision (of time) granted or give reasons for amending or refusing the (Contractor's) claim."
In "Delay and Disruption in Construction Contracts", the author Keith Pickavance favours the "Dominant Cause" approach to the problem.
The dominant cause approach to the allocation of damages arose from a shipping accident case, Leyland Shipping Co. Ltd v Norwich Union Fire Insurance Society Ltd, in which a ship was torpedoed by a German submarine and was subsequently taken to Le Havre for repair. Whilst it was in the deep-water harbour a storm blew up and the ship was towed to anchorage near a breakwater where it broke up and sank. The question was what caused the losses arising out of the ship sinking? Was it the war action for which the owners were not insured, or the perils of the sea for which they were insured? It was held that the ship sank because it was torpedoed and the losses were not recoverable from insurers. Lord Shaw said: "When various factors or causes are concurrent and one has to be selected... the choice falls upon the one to which may variously be ascribed the qualities of reality, predominance, efficiency..."
In the field of construction delay, determining what is the dominant cause is a matter of the application of common sense to construction logic. For example, if delay and extra costs are suffered because work is suspended on a Monday as a result of drawings not arriving in due time and, instead of arriving on Monday, they arrive the following Friday, then without more, the presumption may be that the delay and the costs incurred from Monday to Friday will have been caused by the absence of drawings.
Now if on Tuesday, the work could not proceed because of inclement weather or materials did not arrive, that would probably not upset the presumption because even without these events the subsisting delay in receiving design information would still prevent the work from proceeding and be the dominant cause of the loss.
However, supposing on Tuesday the building burnt down, could it then be reasonably be said that on Wednesday the reason that progress was disrupted was because the drawing information had not arrived? Or, is it more reasonable to say that even if the drawings had been supplied, there was no building left to which the design could be applied? The fire would then be the cause of the delay and the associated costs.
Supposing then, the same fire does not burn the entire building to the ground, but merely damages a few rooms on the ground floor whilst the design information which is lacking is required for work to the upper floor. Then, common sense dictates that, because the fire has not destroyed the relevant elements, the subsisting cause of disruption and costs in relation to the upper floor layouts is the absence of the design drawings.
Is this, then, the formula? If, discounting subsequent events, the work could proceed if the subsisting factor had not occurred, then the subsisting factor is the cause of the delay.
Similarly, if the next logical event in the sequence of construction is the completion of the design layout for wall partitions, which is delayed, then, for example, the late delivery of doors cannot logically be the cause of the disruption costs because, even if they had been delivered, without the layout of the walls the doors could not be installed. Similarly, if there is a delay in the delivery of the design of the wall layouts and the floor slab is condemned and has to be replaced, then, from the moment of the condemnation, the logical cause of the delay in regard to that element can no longer be the failure to provide the design layout for the internal walls, but logically, the cause is then the absence of a floor upon which to put the walls, even if the designs were complete.
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