Extensions of time

Question 1

What are extensions of time?

Answer 1

Adjusts the completion date and relieves the contractor’s liability to pay liquidated damages for the period of the extension

Question 2

What are the relevant clauses in JCT D&B 2016 regarding EOT?

Answer 2

2.26-2.29

Question 3

What are liquidated damages?

Answer 3

A genuine pre-estimate of the likely loss incurred by the employer should the completion date not be met

Question 4

What are the relevant clauses in JCT D&B 2016 regarding LAD’s?

Answer 4

2.34

Question 5

What must be in place before LADs can be deducted?

Answer 5

• Non completion certificate

- Payless notice

Question 6

What if the liquidated damages are construed to be a penalty?

Answer 6

• They will not be enforceable

- The employer will have to sue for any actual direct loss that can be proved

Question 7

What are the benefits of liquidated damages to the contractor?

Answer 7

The contractor knows the consequences of delay from the outset

Question 8

What if the employer actually suffered no loss / damage?

Answer 8

• It doesn’t matter

- They can still deduct the liquidated damages stated in the contract

Question 9

What happens when ‘time is at large’?

Answer 9

• There is no set completion date
• The contractor only has the obligation to complete the works in a ‘reasonable time’
• Liquidated damages cannot be claimed (no date to take them from)
• The employer would have to try and prove that the contractor had not completed in a reasonable time

Question 10

What is the procedure for claiming an extension of time?

Answer 10

• As soon as it is reasonable apparent that a delay is or is likely to occur contractor should write to notify the employer.
• This should identify the cause of the delay and if any of the causes are a Relevant Event, and give an indication of the extent of the likely delay
• They should give any other further information requested by the employer
• The employer must notify the contractor in writing of their decision

Question 11

What are the time periods related to granting extensions of time?

Answer 11

• The employer has 12 weeks from notification to decide on an extension of time
• If there is less than 12 weeks to PC, they should endeavour to decide before PC
• The employer has up to 12 weeks after PC to review any previous EOTs previously given or to award further EOTs

Question 12

What are Relevant Events?

Answer 12

The events that entitle the contractor to an extension of time

Question 13

What are some relevant events?

Answer 13

in 2.26 of JCT 2016

• Variations
• Employers instructions
• Deferment of giving possession of a site
• Suspension by the contractor
• Failure to carry out statutory works
• Exceptionally adverse weather conditions
• Strikes affecting trade
• Force majeure

Question 14

If work is delayed due to two or more competing causes of delay, one the fault of the contractor and one the fault of the employer, is there an entitlement to an EOT/loss and expense?

Answer 14

• No clear rule on which delay takes precedence where a number of delays occur
• Each case has to be judged on its merits
• Have to make efforts to identify all causes and effects

Question 15

Who owns programme float?

Answer 15

• No clear rule – generally it belongs to the contractor
• The contractor normally includes float in his programme to accommodate his risk items and also provide time for correcting mistakes
• THEREFORE the actual impact of the delay should be considered