If ever there was a case that illustrates the bad old days of dispute resolution, Royal Brompton Hospital NHS Trust vs FA Hammond and others is it. Having slugged its way through a massive arbitration with contractor Taylor Woodrow, the NHS trust turned on its professional team, saying it had been overgenerous in granting extensions of time.
One of the central issues in the litigation was whether the contract administrator, Watkins Gray International, had properly operated the extension of time provisions in the JCT standard form. As is so often the case, the situation was complicated by issues of concurrent delay. It is on that aspect of the case that I want to dwell.
Returning to Malmaison, it is a bit of a myth that Mr Justice Dyson's decision is the definitive word on concurrent delay. Although he did make a number of observations on the subject, he can hardly be said to have explored the issue in great detail.
To illustrate his views on concurrency, he took the example of a project start that was held up by exceptionally inclement weather, which is a "relevant event" (one that allows the contractor to claim more time), and also because the contractor had a labour shortage, which is not a relevant event. In that situation, the judge said the architect should grant an extension of one week. In other words, having satisfied himself that the weather was truly a cause of the delay, he could not deny the contractor an extension on the grounds that the project would have been held up by the labour shortage.
Is the judge saying that only delays which occur at the same time are concurrent? What if critical delays overlap?
In striking something of a balance between the parties, many commentators have welcomed the Dyson approach as the most fair and reasonable way to proceed. The implications are that the employer cannot levy liquidated damages against the contractor for delay while the contractor should not be allowed to recover its prolongation costs.
In the Brompton case, His Honour Judge Richard Seymour also used practical examples to illustrate his views on concurrent delays. He contrasted what he considered to be two quite different scenarios. The first involves a project already delayed because of an irrelevant event when a relevant event occurs. This was contrasted with a project that is on programme when two things happen – one a relevant event and the other down to the contractor – either of which alone would delay the scheme.
In the judge's opinion, the second scenario is true concurrent delay, but not the first. In fact, in the first scenario, the judge considered that it cannot even be said that the relevant event did cause delay. Consequently, the contractor would not be entitled to an extension of time and the employer would be entitled to levy liquidated damages for delay.
The Brompton decision asks more questions than it answers. Is it, as the judge indicated, consistent with Malmaison? Is the judge saying that only delays that occur at exactly the same time are truly concurrent? If so, what about the situation where two critical delays overlap but are not completely co-extensive? How does the judge distinguish between critical and non-critical delays in the first place?
Dominic Helps is a partner at solicitor Shadbolt & Co. He can be contacted on 01737-226277 or emailed on Dominic_Helps@shadboltlaw.co.uk.