Clash points

The Egan Report and the activities of the Movement for Innovation have undoubtedly engendered a new emphasis in construction. Instead of seeking reasons for failure, the industry is focusing on how to succeed. Cost reductions year on year, zero defects and completion to time are the orders of the day. Is it not time these were translated into forms of contract? Take JCT98. Let’s look at extension of time clauses. Their original purpose was to preserve the employer’s entitlement to liquidated and ascertained damages for failure to complete in circumstances where the employer had itself caused the delay.

Some of the long list of “relevant events” set out in clause 25 are designed to meet the original objective: late issue of information by the architect, late issue of instructions, delay by the employers’ artists and tradesmen, and so on. Why can the JCT not provide for extensions for any breach or act of prevention on the part of the employer or the architect? A succinct expression of the objective of the clause would save a page of drafting.

Over the years, other relevant events have crept into clause 25.4. Some could be regarded as being outside both parties’ control, and therefore there is an argument for giving extensions of time for them on the basis of sensible risk-sharing: delay caused by force majeure, for example, or threat of terrorism.

But even some of these arguably fall into the category of events that the contractor is better able to control and manage than the employer. I put in this category exceptionally adverse weather or delays by local authorities or statutory undertakers.

The other concern in relation to these items is that they are used by the architect or contract administrator to “fudge”. Where the team feels that the contractor should not be penalised for late completion, whatever the employer might think, they can use these grounds to relieve it of liability. In the new climate, it does not seem to me that this is acceptable practice: these matters should be debated openly with the employer.

If, for whatever reason, the contractor should not be penalised, it is for the employer to make this concession. The team should not give extensions of time for events that can often be avoided using modern methods of construction.

Finally, there is a category of event that must surely be the contractor’s proper responsibility – such as securing labour, goods and materials for the carrying out of work, or delays on the part of nominated suppliers or subcontractors.

Surely Jennie cannot now condone these excuses for non-performance appearing in the most used standard form in the industry? Surely she would agree that it was time to radically overhaul these provisions in the light of the new Egan approach?