The Society of Construction Law’s rules for handling delay can now be incorporated into your contract – with dramatic consequences for the programme
It has always struck me as odd that nobody makes more of a fuss of the fact that under the standard forms it is the contract administrator who grants extensions of time. The reason for my concern is that extensions of time are frequently required because the contract administrator has delivered late information.
Although it cannot be impossible for someone in this position to grant a fair extension – indeed, it is what they are obliged to do – more extensions than I would have expected are granted for neutral events, such as adverse weather, rather than late information. This must obviously be coincidence rather than the result of a conflict of interest.
The last attempt to address the way that extensions are dealt with was the Society of Construction Law’s delay and disruption protocol, published back in 2002. It came in for criticism for the way that it moved from being guidance to dictating how issues such as ownership of float and payment of compensation were dealt with. The critics thought it potentially shifted the balance of what would have been normal entitlement under the contract or at common law.
The original consultation version of the protocol suggested that it could be used as a contract document. Because of fierce opposition from those who thought that this would tamper with the “normal” rules of entitlement, this approach was altered in the final version of the protocol. As published, it now says in its introduction that it is not intended to be used as a contract document.
Eighteen months on, inevitably, an independent amendment and associated practice note have been published that allow the incorporation of the protocol into JCT contracts (The PFE Change Management Supplement published by Fenwick Elliott and Pickavance Consulting.) The document changes contractual relationships dramatically by creating the new role of risk manager. It also:
- Allows the risk manager to specify the format of records to be kept by the contractor.
- Introduces a provisional sum for the contractor’s work in preparing and updating programmes and progress records.
- Imposes liquidated damages in the event that the contractor does not provide these programmes or records.
- Requires the architect, on the advice of the risk manager, to accept the master programme.
- Gives the risk manager the job of dealing with the assessment of contractor’s applications for extensions of time
- Allows the risk manager to develop proposals for the contractor to reschedule or resequence the works to accelerate completion. Damages are paid if the contractor fails to do so.
The amendment has been criticised for being legally inconsistent, too long and complicated, and for giving the role of delay analysis to a consultant who has no teeth. Whether you like it or not will be a matter of taste.
The amendment to the protocol has been criticised for being legally inconsistent, too long and complicated
Personally, although I would not go to the lengths that the amendment does in changing the contract, I think there is a need for improvement in how we deal with programming matters under contracts.
A quick reference to JCT98 shows why. All it calls for is a master programme to be provided by the contractor.
No description, definition or detail. No indication about what happens next. In broad terms I would recommend that any contracts define:
- The complexity and detail of the programme you want from the contractor. This will vary, obviously, depending on the size and structure of the project.
- How the programme is to be structured – required activities, relationships and dependencies between them, critical path and float.
- What software you want the contractor to use.
- How often the programme needs to be updated.
- The records that you want the contractor to keep.