Lawyers have warned that construction companies could face legal and financial problems if Met Office predictions of a harsh winter come true.
Although most contracts allow extensions of time in extremely adverse weather, Nick Lane, a construction lawyer at Travers Smith, warned that spiralling costs from staff and machinery left idle will fall on the contractor.
“Most contractors will know they’ll be able to get an extension of time, but money’s a different matter. They won’t get the money back,” he said.
Lane said the ambiguous definition of “adverse” weather is likely to cause legal problems because if bad weather delays a project but cannot be called “exceptionally bad” contractors could be liable to pay the client liquidated damages for late completion.
Although NEC contracts define exceptionally bad weather as an event that happens once every 10 years, others just make a general provision, and construction lawyers say this could lead to arguments between clients and contractors.
Most contracts state that contractors must make their best effort to keep work going, for example by altering the programme of works to accommodate the weather. If companies do not plan now they could face legal headaches from clients that claim they ignored weather warnings.
However, Lane added that the need to keep working where possible would not mean that contractors would have to pay for more expensive materials that work in colder temperatures.
“Almost all contracts will say the contractors will have to keep working if they can, but it probably wouldn’t get so far that they will have to use, say, a different form of concrete. Fundamentally they have agreed to do a job for a price.”
Companies could also suffer if they try to keep staff working during adverse conditions without protecting them adequately.
Contractors can get an extension of time, but they won’t get money back
Nick Lane, Travers Smith
The Construction (Health, Safety and Welfare) Regulations 1996 say staff working outdoors must be provided with protective equipment and clothing in adverse weather.
If contractors allow staff to work in unsafe conditions without taking sufficient steps a magistrates’ court could impose a fine of up to £20,000 for each breach. If a judge thinks the company needs a harsher punishment the case can be sent to crown court.
Rupert Choat, solicitor advocate at law firm CMS Cameron McKenna, said under the new suite of JCT building contracts companies could be held responsible for frost damage that happened after practical completion.
Choat said that JCT1998 contracts make a clear provision for frost damage, so that the client is responsible for it after practical completion unless it can be linked back to contractor errors.
But the 2005 contracts are worded differently, and could mean that contractors face claims for frost damage on projects after practical completion.
“At best this has created uncertainty, and at worst the problem has been passed onto contractors,” he said.