If the recent snow has caused disruption to a construction project you can make a claim, but you need to know how the various contract forms work first …
It is a sign of the unusual prevalence of snowfall in December that William Hill slashed its odds on a white Christmas to their lowest for more than a decade. In recent years, such extreme weather has become more common and has caused disruption to construction sites throughout the UK. So what recourse do contractors hit by snow delays have?
Obviously, it depends on the particular contract used on the project in question. Below is an outline of the position adopted by three standard forms of contract.
General position: a contractor can claim an extension of time (EOT) but no loss or expense for “exceptionally adverse weather” conditions.
Definition: “exceptionally adverse weather” conditions are not defined and it is left to the architect/contract administrator to decide at his or her discretion.
Causation: the contractor will need to prove that the weather caused the delay suffered.
General position: a contractor can claim an EOT but no loss or expense for “exceptionally adverse weather conditions”.
Definition: “exceptionally adverse weather conditions” are not defined and it is for the Engineer to determine whether the contractor is entitled to an EOT.
Causation: the contractor will be required to show that the weather caused the delay in question.
General position: adverse weather is clearly a “compensation event”, the occurrence of which entitles the contractor to recover loss and expense as well as an EOT.
Definition: “adverse” is defined by either reference to 10-year records or the values stated in the contract data.
Causation: as a result of the definition of adverse weather, the approach taken is different from the JCT and NEC forms of contract:
- the contract refers to the number of days with snow lying at a specified time in a specified location, so even if the snowfall on a particular day did not actually hinder progress on site, it can count towards the recorded number of days of snow; and
- the location named in the contract as the place to record the weather measurements may not be the construction site, in which case the contractor may not be entitled to a compensation event even if progress was affected on the site itself.
- the NEC approach is based on calendar months, so if the bad weather occurs across two months this decreases the likelihood that the contractor will be entitled to compensation; and
- only the difference between the weather measurement and the weather which, based on historical records, is shown to occur on average less frequently than once in 10 years is taken into account in assessing a compensation event.
It is advisable that construction contracts are as clear and unambiguous as possible as to the circumstances in which the contractor is entitled to compensation as a result of weather conditions. This should include defining “adverse weather” and specifying the evidence required to establish a claim.
It is also prudent for the contractor to:
- consider the increased risk at the tender stage and price each job accordingly;
- make use of specialised forecasting services once construction has commenced;
- keep accurate records (including photograph evidence if necessary) and compile relevant meteorological evidence to support any claims; and
- comply with any contractual requirements in respect of early warnings and notification of claims.
Chris Hill is a construction partner at Norton Rose