UNIVERSITY OF ILORIN

FACULTY OF ENVIRONMENTAL SCIENCES

DEPARTMENT OF QUANTITY SURVEYING

COURSE: CONSTRUCTION CONTRACT ADMINISTRATION

COURSE CODE: QTS 411

REPORT TOPIC: EXTENSION OF TIME IN BUILDING

CONTRACT WITH REFERENCE TO THE PROVISIONS IN THE
JCT 2005 AND HOW IT IS ASSESSED AND GRANTED TO A
CONTRACT ON A BUILDING PROJECT

ASSIGNMENT SUBMITTED BY: GROUP 5 MEMBERS

ISHOLA HALEEMAH SOLIHU 13/31QS014

MUHAMMAD ZULFAT OMOBOLANLE 14/31QS062

OSADARE BENJAMIN DAMMY 14/31QS055

BADMUS BASHIR 13/31QS008

LECTURER IN CHARGE: DR AMUDA YUSUF

DATE: 20/01/2017
 CONSTRUCTION CONRACT ADMINISTRATION (QTS411) January 19, 2017

TABLE OF CONTENTS

 CHAPTER 1
 Introduction
 The JCT 2005
 Aims and Objectives

 CHAPTER 2
 Time and delay related provisions under the JCT form of
contracts

 Relevant Events
 Liquidated and ascertained damages
 Loss and expense

 CHAPTER 3
 Time at large
 Delay and types of delay
 Claims build-up for extension of time

 CHAPTER 4
 Assessment and Granting of Extension to contractor
 Scenario and cases resulting from extension of time
 Conclusion
 References

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CHAPTER 1

1.1 INTRODUCTION

In a construction contract, both the employer and the contractor may contribute to
causing delay to construction contracts. Employers may cause delay by constantly changing the
design and contractors may cause delay due to the lack of efficiency in planning. There are also
delays that are caused by events which neither party has control over e.g. force majeure and
adverse weather.

To cater for these issues, most of the standard forms of contracts allows for extension of
time. There has always been an assumption that the provision of an extension of time clause in
a construction contract is solely for the benefit of contractors. However, in actual fact, the
extension of time provision is primarily provided to protect the employer’s right for liquidated
damages. Common law has established that in the absence of an extension of time provision,
the liquidated damages provision may be unenforceable under contract.

1.2 THE JCT 2005

The Joint Contract Tribunal (JCT) 2005 is more comprehensive compared to its
predecessor especially with the inclusion of popular supplements such as sectional completion,
collateral warranties, fluctuation and contractor’s design portion. It was drafted using simple
English rather than the legalistic approach. The conditions of the contract have been
restructured categorized into sections and schedules which replaced the ‘clause by clause’
format adopted in the previous suite. The JCT forms of contract were chosen due to the
dominant usage of their contract in the United Kingdom construction industry and as a result in
Nigeria.

Some of the key changes to the provision on time in the current JCT Standard Building
Contract with Quantities (SBC/Q), JCT Standard Building Contract with Approximate
Quantities (SBC/AQ) and JCT Standard Building Contract without Quantities (SBC/XQ) as
follows:

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(i) The heading of ‘extension of time’ in the previous contract has now been replaced
with ‘adjustment of completion date’. The procedures in the provision however, still
refer to the process of providing extension of time to the contractor.

(ii) The listed Relevant Events has also been revised and reduced. Some of the reduced
events were combined into a ‘catch all clause’ intended to cover defaults or
omissions by the act of employer. This is to preserve the rights of the employer to
the liquidated damages clause in the event of default or omission by the employer.

(iii) The 2005 suite also saw the omissions of a number of provisions from the previous
contract including provisions which were found redundant when compared with the
existing legislation. The omitted provision includes the provisions on Nominated
Sub-Contractors and Suppliers, statutory procedural material which is the
Construction Industry Scheme (CIS), the Value Added Tax (VAT) Supplemental
Provisions and Construction, Design and Management (CDM) Regulations.

1.2 AIM

The aim of this report is to explain the term ‘Extension of time in building contract’
with reference to the provisions in the JCT 2005 and how it is assessed and granted to a
contractor on a building project

1.3 OBJECTIVES
The main objectives of this report are to;

 Explain the term extension of time.

 Highlight the factors leading to extension of time.
 Examine how extension of time is granted to a contractor.
 Examine Clauses in JCT 2005 dealing with extension of time.

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CHAPTER 2

2.2 TIME AND DELAY PROVISIONS (JCT 2005)

The parties’ obligations relating to provisions on time and delay in the current JCT
contracts have been structured well and are extensive. The provisions include clauses on time
for possession of site, completion of the works or sections of the works, adjustment of
completion date and identification of delayed events. These provisions will be examined in
detail to evaluate the approach of JCT contracts in assessing extension of time and dealing with
concurrent delay.

2.2.1 POSSESSION OF SITE

This provision is linked closely to the administration of time clause. Delay in providing
“possession of the site" as mentioned in clause 2.4.1-2 Of the JCT 2005 may lead to a claim for
extension of time by the contractor under the Relevant Events clauses. The employer will be in
serious breach if he fails to give full possession of the site to enable the contractor to perform
his obligations under the contract unless stated in the contract otherwise.

Deferment of the provision of site possession is allowed up to six weeks under clause
2.5 of the current JCT contract. The employer is advised to notify the contractor in writing in
advance about the intention to defer the site possession even though it is not required by the
contract. The contractor may entitle for an extension of time if the possession of site is defer
by the employer.

2.2.2 PROGRESS OF THE WORK

Upon receiving site possession, the contractor is obliged to proceed to conduct/deliver

the work “regularly and diligently", the obligation upon the contractor is essentially to proceed
continuously, industriously and efficiently with appropriate physical resources so as to progress
the works steadily towards completion substantially in accordance with the contractual
requirements as to time, sequence and quality of work.

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2.2.3 COMPLETION OF WORK

Under clause 2.4, the contractor is responsible to execute his work regularly and
diligently and “...to complete the same on or before the relevant Completion Date" The date of
completion has a very significant effect to the contract. Delay will be calculated starting from
this point, in the event the contractor fails to complete the work by the completion date.

2.2.4 CONTRACTOR’S PROGRAMME

The advantage of having a contractor’s programme in a construction contract is to

enable the employer to monitor and anticipate the contractor’s planning for the completion of
the project. An efficient programme will normally consist of the identification of the critical
path, the sequencing of activities, identification of the critical activities and other important
particulars including the contractor’s obligation regarding to the contractor’s work programme
under the current JCT which is limited to clause 2.9.

2.2.5 NOTICE OF DELAY

Under clause 2.27 of the current contract the contractor is obliged to serve a notice of
delay to the Architect or Contract Administrator in the event “works or any section is being or
likely to be delayed". Under clause 2.27.2, it requires the contractor to submit particulars on
the expected impact of the events listed in the notice. A notice would allow the parties to be
prepared for the consequences of the likely event which obviously was not foreseen by the
parties, a question arises on whether the submission of a notice on possible delay would give
merit to the contractor claim for extension of time. Further, the issue arises as to what are the
consequences if the contractor failed to issue such a notice. The wording of the JCT contract in
the early years was commented by Mr. Justice Vinelott in the case of London Borough of
Merton v Stanley Hugh Leach Ltd where it was held that the Architect should always consider
whether an event may lead to delay and grant appropriate extension of time even though the
contractor failed to submit a notice on the delay. Thus, failure to serve a notice is a breach of
contract by the contractor and will have an effect on his entitlement of the extension of time had
he served notice on the delay.

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2.2.6 ADJUSTMENT OF COMPLETION DATE

The current JCT 2005 allows the Contract Administrator to reduce the completion date
earlier and also extend the date of completion fixed before. Like any other modern standard
forms of contract, JCT provided the extension of time clause to preserve the rights of
deducting liquidated damages in the case of an employer’s delaying event. Under clause 2.29,
there are lists prescribing the ‘Relevant Events’ which will give the contractor entitlement to an
extension of time; Clause 2.29.1-2.29.6 of the current contract which considers the delay
caused by employers and neutral events which are not caused by either, still entitles the
contractor to claim for an extension of the contract date of completion.

2.2.6.1 RELEVANT EVENTS

Relevant Events terminology has been used since the 1980 form. Relevant Events is the
terminology and provision used in JCT contracts to describe grounds to be considered by the
contract administrator for an extension of time. Compared to the previous JCT standard forms,
the Relevant Events has been reduced in the latest JCT standard forms. In the occurrence of a
Relevant Event, the JCT is not sufficient enough for the Contract Administrator to award
extension of time. The event must be the cause of the delay and affect the date of completion
of the contract.

Below are the grounds for extension of time or Relevant Events under the latest JCT
standard forms (2005). Some of the common grounds for claims will be discussed in more
detail:
 Variations
 Deferment of Site Possession
 Suspension of work by the Contractor
 All Inclusive clause
 Civil Commotion
 Statutory undertaker
 Exceptionally adverse weather
 Loss or damage by any of specified perils
 Force majeure

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 Variations

Like other standard forms of contract, JCT include variations or instructed change as
one of the grounds for extension of time. The variation clause in JCT includes addition,
omission or any changes to the obligations of the contractor as long as it is still within the scope
of contract. The specific definition of variations in the JCT can be found in reference to clause
5.1.
Variations regularly come from the employer or his team due to various events which
may include error or unforeseen mistakes due to time limit before a tender. By providing the
provision of extending the date of completion due to variation, the employer should be able to
accommodate changes for justified reasons without breaching the contract and allow the
contractor to be reimbursed for additional works.

 Deferment Of Site Possession

As described earlier in this chapter, delay in giving possession of site to the contractor
by the employer will entitle the contractor to an extension of time. In the event that delay occurs
in giving possession of site to the contractor, the deferment provision ensure that the employer
is not in breach of contract and would still be able to claim liquidated damages from the
contractor.

 Suspension Of Work By The Contractor

Parallel with the Housing Grants, Construction and Regenerations Act 1996, clause
2.29.5 refer to clause 4.14 allows the contractor to suspend his performance of his obligation
under the contract if the employer fails to make payment due before or on the final date for
payment under the contract.

 All Inclusive Clause

To ensure that there is an additional provision to protect the employer and his agents or
persons he is contractually responsible to, JCT contracts provide all inclusive kind of clause
which stated “any impediment, prevention or default" to accommodate almost any defect for

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which the employer and his men is contractually liable for delay. The includes all clauses like
failure by the architect to provide information and drawings, execution of work by person
employed by the employer or executed by himself and some other grounds to be considered for
extension of time under the clause.

 Statutory Undertaker

The clause described the event of the contractor’s scope of carrying out work pursuant
to their statutory obligation. It is defined clearly in clause 1.1 of the JCT contract.

 Exceptionally Adverse Weather

Clause 2.29.7 list exceptionally adverse weather conditions as a Relevant Events which
allows for extension of time. However, the contractor needs to prove that the weather on that
day was exceptionally adverse compared to at least a number of significant years. Recorded
data should be available from the local MET office. There is also a need to show that the
adverse weather on the day was the cause of the delay.

 Loss Or Damage By Any Of Specified Perils

Grounds covered under clause 2.29.9 are defined referring to clause 6.8. The specified
perils in JCT cover for “fire, lightning, explosion, storm, flood, escape of water from any water
tank, apparatus or pipe, earthquake, aircraft and other aerial devices or articles dropped there
from, riot and civil commotion, but excluding Excepted Risks".

 Force Majeure

The French origin term has been used since in JCT since its 1963 form. It was
introduced in the classic English case of Lebeaupin v Crispin the court upheld the usage of the
term. The judge refer the term “to all circumstances independent of the will of man, and which
is not in his power to control"

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2.3 LIQUIDATED DAMAGES IN CONSTRUCTION CONTRACTS

Contracts generally include a provision for the contractor to pay liquidated damages (or
liquidated and ascertained damages, sometimes referred to as LAD's) to the client in the event
that the contract is breached. In building contracts, liquidated damages usually relate to the
contractor failing to achieve practical completion (i.e. completing the works so they can
handover the site to the client) by the completion date set out in the contract.

Liquidated damages are not penalties, they are pre-determined damages set at the time
that a contract is entered into, based on a calculation of the actual loss the client is likely to
incur if the contractor fails to meet the completion date. They might include, rent on temporary
accommodation, removal costs, extra running costs and so on and they are generally set as a
fixed daily or weekly sum. If the contract prevents the client claiming liquidated damages , or if
actual losses are significantly different to those that were estimated at the time the contract was
entered into, then the client may pursue a claim for unliquidated (i.e. actual) damages through
the courts. This would require them to prove that an actual loss had been incurred and that loss
was not too 'remote'.

As liquidated damages are not a penalty, they must have been based on a genuine
calculation of damages when they were set. If they are not genuine, they may be considered a
penalty by the courts and so will be unenforceable (see Dunlop Pneumatic Tyre Co Ltd v New
Garage and Motor Co Ltd). Under these circumstances, the client would still be able to pursue a
claim for breach of contract. If the project is delayed by an event that impacts on the completion
date , but is not the fault of the contractor, then this may constitute a ' relevant event ' for which
the contractor may be granted an extension of time (i.e. the completion date in the contract is
adjusted), and the contractor may be able to make a claim for loss and expense . A relevant
event might be a delay that is caused by the client, or a neutral event such as exceptionally
adverse weather.

A liquidated damages will be enforceable if;

(1) The damages anticipated as a result of the breach are uncertain in amount or difficult to
prove

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(2) The parties intended to liquidate damages in advance, and

(3) The amount agreed upon is reasonable and not greatly disproportionate to the presumable
loss or injury.” Holloway Automotive Group v. Lucic , 163 N.H. 6, 9-10 (2011).

If a liquidated damages clause is unenforceable, the non-breaching party can still

recover any provable actual damages. General Linen Services, Inc. v. Franconia Investment
Associates, L.P , 150 N.H. 595, 600 (2004).

2.4 LOSS AND EXPENSE

A claim for loss and expense is often described as the financial side of a 'delay' claim.
However, it does not always follow that delay caused by the employer to a project will occasion
loss to the contractor: simply because the contractor has received an extension of time does not
always mean he will be entitled to additional payment as well. Moreover, the losses actually
suffered will not necessarily be down to the delay: for example, where the progress of the
contractor's work is made less efficient as a result of employer actions, the contractor will have
a claim for disruption, not delay. Claims should be judged against the actual progress of the
works, not the programme, and must demonstrate the link between the breach (cause) and the
delay.

Overriding principles of a loss and expense claim

It is important to recognise that delay and disruption are separate and distinct concepts:
delay relates to time, and disruption relates to inefficiency and the need for additional resources.
Works may be delayed, but not disrupted; conversely, works may be disrupted, but finished on
time:

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 A 'delay' claim is essentially a claim for prolongation, either of the project or of

particular activities. Certain resources (such as project office or management) may have
been required for a longer period, or particular activities may have taken longer, so that
resources (such as plant or labour) were required for that activity for a longer period,
thus incurring additional costs.

 In proving a 'disruption' claim, however, the contractor will have to show that he was
obliged to carry out works in a less efficient manner as a result of acts or defaults of the
defendant. There may be periods or areas where the contractor's work was interrupted,
or where employer 'events' necessitated the use of additional resources. It goes without
saying that disruption claims are more difficult to prove: Not all disruption will trigger
the payment of compensation. A contractor will only be entitled to recover such costs if
it can prove that the employer prevented or caused hindrance to the execution of the
works.

The established (and arguably most straightforward) route for a contractor to recover
loss and expense arising out of delay or disruption to a building contract will be pursuant to the
express terms of the contract in question. Such terms ordinarily require the contractor to set out
the 'loss and expense' event, together with substantiation of such losses, and the contract
administrator or architect will then assess and ascertain if any sums are payable and issue a
certificate if so required.

Under the JCT Standard Form of Building Contract 2005 edition, the contractor applies
for loss and expense under clause 4.23, Even if an industry-wide standard form is not used,
many contracts provide for the service of a timeout notice from the contractor in order to
recover loss and expense. This will often be worded as a precondition to contractual relief, and
the courts will not shy from enforcing the precondition. However, if the contractor's relief fails
under the contract as a result of his failure to comply with formalities, he will nonetheless be
entitled to bring a loss and expense claim for breach of contract: in other words, his right to
recover will not be lost.

It is possible, however, that express words of the contract could restrict the contractor's
remedy at common law if notice provisions are not complied with. The contractor's application
for payment in respect of variations is covered by the 2005 form at clauses 5.6-5.9; payment in

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respect of overheads and profit may well have been allowed for in the contractor's variation
claim and the contractor must be careful not to make the same application twice as this will
amount to double recovery.

There is a distinction between claims for 'delay' and claims for 'disruption' as an
exaggerated claim will be fairly transparent to any sensible employer and to the court. Where
events occasioning loss and expense are 'concurrent', and the contractor is responsible for one
of those events, his loss and expense claim may fail. Absent a notice, the contractor cannot
claim under clause 4.23. However, an application for an extension of time under clause 2.28
will not be a precondition to a loss and expense claim under 4.23. (Fairweather v Wandsworth
(1987) 39 BLR 106.)

Construction contracts will generally provide for the contractor to claim direct loss and / or
expense as a result of the progress of the works being materially affected by relevant matters for
which the client is responsible, such as:

 Failure to give the contractor possession of the site.

 Failure to give the contractor access to and from the site.
 Delays in receiving instructions.
 Opening up works or testing works that then prove to have been carried out in
accordance with the contract.
 Discrepancies in the contract documents.
 Disruption caused by works being carried out by the client.
 Failure by the client to supply goods or materials.
 Instructions relating to variations and expenditure of provisional sums.
 Inaccurate forecasting of works described by approximate quantities.

Claims may comprise costs resulting from disruption to the works or from delays to the
works ( prolongation ). The contractor must give written notice of a claim as soon as it becomes
reasonably apparent that the regular progress of the works is being materially affected. This
need not necessarily result in a delay to the completion date , and so claims for loss and expense
and claims for extensions of time do not necessarily always run together.

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Claims are restricted to 'direct' loss and expense and so ' consequential losses ' (such as lost
production) are generally excluded. Direct losses are those that 'flow naturally' from the breach
of contract. There is disparity between contract types about whether items such as head office
overheads can be included in claims for loss and expense, and some court rulings have allowed
such claims. If there are specific consequential losses which the parties to the contract wish to
exclude, it may be prudent therefore to state these explicitly within the contract.

Contract time extensions are based on the ability to demonstrate that delays have occurred
in the construction schedule affecting project completion date. All time extension are due to
delays beyond the Contractor’s control, many of them as part of change order requests. Time
extension requests are normally specified in contract’s provision and requesting time extensions
should be made following all steps and documentation under the contract guideline.

It is also important to highlight that time extensions will be denied for the following reasons:

 When the delays claim are caused by subcontractors

 When there is insufficient or inadequate workforce
 Underperforming by the contractor , specifically procuring long lead items
 When the project is affected by normal weather delays
 When insufficient proof or evidence that the critical path method has suffered
irrecoverable delays caused by the contractor or their parties

Processes to Request a Time Extension

When requesting a time extension certain steps must be followed, otherwise, the time
extension might not be approved. Normally, the Contractor should notify the Project Manager,
when any issue might affect the project schedule. A formal letter must be addressed to the
Contract Administrator requesting the time extension and the reasons why those days should be
added to the construction schedule. The Contract Administrator should then, remit the letter to
the Project Manager for evaluation and approval or rejection. If the time extension is granted,
then the Project Manager must answer by written and a change order will be issued. Some
contracts specify that time extension requests should be done within a specific time frame, if
not; the time extension claim will also be rejected.

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Supporting Documents during the Claim Process

The time extension when properly presented must contain the following supporting documents:

 Indicate specific issue causing delays

 List of activities from project schedule being affected by the aforementioned issue
 Exact amount of time being requested specifying working days or calendar days
 Sketches, photographs, or pictures
 Recommendations being given to Contract Administrator
 Indicate the actions the contractor has taken to avoid or minimize other delays
 Alternative solutions presented to Contract Administrator
 Communications between construction team notifying of possible delays and problems
related to a specific situation.
 Additional Items to Consider During the Time Extension Request

Time extension request should also consider the following:

Letter should be concise and must reference the contract clause that allows the request, a
schedule that can prove the delay reasons and the proposed recovery plan. It shall include also
the damages if any, the amount of calendar or working days being requested and the impacted
activities delayed by the changes.

Sample Letter Approving a Time Extension would include:

 The Contractor,
 Contractor Address
 Contract Name
 Contract Number
 Extension of time

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CHAPTER 3

3.1 Time at large

Construction contracts will usually include a date by which the works described in the
contract should be completed. This is generally the date by which practical completion must be
certified. The phrase ‘time at large’ describes the situation where there is no date for
completion, or where the date for completion has become invalid. The contractor is then no
longer bound by the obligation to complete the works by a certain date.

Time can become at large because there is no clear completion date specified in the
contract, or can be a situation that arises as a result of events (typically by agreement of the
parties or by failure of the contract ‘machinery’), or if the contract does not allow the
construction period to be extended. It is not uncommon on construction projects that the works
are not completed by the date for completion. If this is because of delays for which the
contractor is responsible, then the contract will generally include a provision for them to pay
liquidated damages to the client. These are pre-determined damages based on a calculation of
the actual loss that the client is likely to incur if the contractor fails to meet the completion date.

Some contracts require that a certificate of non-completion is issued as a pre-requisite to

deducting liquidated damages. If the works are delayed because of events for which the client is
responsible (an act of prevention) or by agreed neutral events, the contracts will generally
provide for an extension of time to be granted, changing the completion date (see relevant
events). If contracts did not allow the construction period to be extended under such
circumstances, then time would be at large. The client would then not be able to claim
liquidated damages from the contractor as there would be no date against which they could be
calculated and the contractor would then only have to complete the works in a 'reasonable' time.

The client would only be entitled to damages if they could establish that the contract
was not completed within a reasonable time. It is important therefore that clauses describing
relevant events cover all necessary eventualities, otherwise if an event occurs that is not
covered, time will be at large.

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3.2 DELAY

Construction projects tend to be one-offs. A project team comes together to create a

unique development on a particular site under circumstances that will never be repeated. They
are very complex, requiring the co-ordination of permissions, people, goods, plant and
materials and construction can begin despite many ‘unknown’ matters such as incomplete
design information, uncertain site conditions, suppliers and so on. As a consequence delays are
common.

The contractor’s notice is to state not just the cause or causes of the delay; He must also
state the material circumstances. It is important that the notice should go into some detail
regarding why the delay is occurring or is likely to occur and the form of such delay. The cause
of the delay should be interpreted as meaning all the factors giving rise to the delay.

3.3 TYPES OF DELAY

1. Contractor’s caused delay

2. Employer’s caused delay
3. Neutral events

3.4 ASSESMENT OF CONTRACTOR’S DELAY NOTICE AND

ACCEPTANCE

Assessing claims for an extension of time can be complicated and controversial. There
may be multiple or concurrent delays , some of which are the contractor's fault and some not.
There are many occasions where contractors contribute to delay themselves by their
performance during design periods, when producing drawing, mark ups and samples or in inter-
facing with sub-contractors. Crucial in assessing applications for extension of time is the
quality of the information provided and records available.

Concurrent delay is a situation where several causes of delay are running in parallel. An
example might be where consultants details were issued late, but an industrial dispute delayed

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progress of critical work at the same time. In more recent judgments the courts have
disregarded arguments about which was the dominant delay and judgement has been made on
the basis that the loss should lie where it falls.

3.3.1 The issue of delay is expressly dealt with in standard construction contracts through
specific clauses dealing with:

 Extensions of time for specific events beyond the contractor’s control.

 Procedures for the contractor to follow when making an application for an extension of
time.
 Procedures for the contract administrator to follow when giving consideration to the
contractor's application.

These are dealt with in the following clauses of the JCT 2005;

Clause 2.27.2:
The Contractor must give particulars of the expect effects of each relevant event notified
(but not of other delaying factors)

Clause 2.27.3:
The contractor is required to inform the architect of any material (i.e. significant) change
in any of the submitted particulars and estimate of delay and give whatever further information
the architect may reasonably require.

Clause 2.28.1:
The architect’s duty to form an opinion about extension of time does not arise until the
contractor has provided both the notice of delay and the particulars including an estimate of
expected delay in completion. If the particulars are received before the date for completion, the
architect must consider them. The architect has to decide two important things:

1. Whether any of the causes of delay specified by the contractor in the notice is in
fact a relevant event, and
2. Whether completion of the Works is in fact likely to be delayed by the specified
relevant event beyond the completion date.

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Clause 2.28.2:
The architect must inform the contractor whether or not an extension is given. That is
important. The architect cannot simply sit back and say nothing if there is no extension. In
respect of each notification of delay and provision of particulars, the architect must notify the
contractor in writing where the decision is not to fix a later completion date as a new
completion date.

Clause 2.28.3:
If the architect’s decision is that an extension of time is to be given, the architect, in
fixing the new completion date, must state two things. The first thing is the amount of extension
of time given in respect of each relevant event and the second thing is the reduction in time
attributed to each relevant omission

FIG 1.1 SHOWING PROJECT TIMELINE BASED ON JCT 05

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CHAPTER 4

4.1 In practice it is probable that the contract administrator will base an

extension of time decision on:

 The latest agreed programme.

 Information submitted by the contractor.
 Awareness of progress to date.
 Careful consideration of available facts at the time.

Often there is a tendency to assume that financial recompense automatically follows an

extension of time. However, whilst the extension of time and loss and expense clauses are
clearly related, it is not necessary the case that time and money claims are linked. This often
comes as disappointing news for contractors leading to lengthy and costly disputes. Thus, it is
necessary to establish what happened and why. However, from a practical standpoint, this is
likely to be a complex matter because, unless the project is a simple one, there is unlikely to be
a single cause of delay; indeed there may be concurrent delays and some delay events may be
more significant than others (i.e. a dominant cause of delay).

4.2 Scenario1

Claims for extension of time can run alongside claims for loss and expense (relevant
matters) however, one need not necessarily lead to the other. It is very important when
deducting liquidated damages to ensure that the correct contractual procedures are adhered to.

In the case of Octoesse LLP v Trak Special Projects Ltd (2016), Justice Jefford held that
Octoesse was not entitled to deduct liquidated damages as they had agreed to an extension of
time after a certificate of non completion had been issued. The JCT Intermediate Building
Contract is constructed such that:

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“If the Contractor fails to complete the Works or a Section by the relevant completion Date, the
Architect / Contract administrator shall issue a certificate to that effect. If an extension of time
is made after the issue of such certificate, the extension shall cancel that certificate and the
Architect / Contract Administrator shall where necessary issue a further certificate.”

 As Octoesse had not issued a further certificate of non completion, they were not
entitled to deduct liquidated damages.

4.3 CONCLUSION

According JCT 2005 as cited in the chapters above, the contractor is entitled to an
extension of time for relevant events where the contract completion date is likely to be delayed,
An important consideration with regard to both extensions of time and delay and disruption is
the long standing legal principle of mitigation (reasonable action to minimize the amount of
loss suffered).

Extensions of time for instructions issued by the architect after the contract completion
date when the contractor is in culpable delay must be calculated on a net basis (following the
judgement in Balfour Beatty Building Ltd v. Chestermount Properties Ltd (1993)) That
Architect should “start with the existing completion date and postpone it to the extent which
he considered as fair and reasonable having regards to the delay causes by the requirement
to execute the variation instructions”

Consequently, where there is delay and / or disruption, an implied term of the contract
will require the contractor to mitigate his loss. This means that the contractor in non culpable
delay cannot just sit back, rub his hands together and wait for the money to pour in from the
employer. The contractor must employ a fair and reasonable means to reduce the impact of the
circumstances in question.

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REFERENCES

 Joint Contract Tribunal - JCT 2005(Revision 2 2009)

 Joint Contract Tribunal - JCT 1998
 Atkinson Law, Delay and Disruption – The contractor’s Obligation as to Time
 Herbert Smith, Extension of Time: What happens if the contractual Machineries breaks
Down.
 Construct-Support : Extension of time
 LawTeacher.com/Time and Delay Related Provisions under JCT
 Extension of time under JCT standard form Contracts, standard Building contract
(SBC)
 Multiplex Construction v Honeywell Control Systems.
 https://www.designingbuildings.co.uk/wiki/Time_at_large
 PACE Guidance on the Appointment of Consultants and Contractors. P187
 Boyes Turner: Liquidated damages clauses in construction contracts.

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