Will a claim which fails to link cause and effect necessarily fail?

The proper manner of presenting a claim before a court or arbitrator is to link the cause of delay with any resulting extra cost. However, some contractors shortcut the need to link cause and effect by using the approach of a global claim.

What is a global claim? A global claim is where all causes of delay are lumped together and one overall delay given as a consequence.

In J. Crosby & Sons Ltd v Portland Urban & District Council (1967), the arbitrator said that:

“…as each matter occurred its consequences were added to the cumulative consequences of the matters which had preceded it. The delay and disorganisation which ultimately resulted was cumulative and attributed to the combined effect of all these matters…”

In addition to global claims, there can also be hybrid claims (whereby it is partially particularised and partially pleaded in a global manner). The Privy Council recognised such hybrid claims in the Hong Kong case of Wharf Properties Ltd and Another v Eric Cumine Associates and Others (1991), whereby Lord Oliver held that in cases where the full extent of extra costs incurred through delay depend upon a complex interaction between the consequences of various events so that it may be difficult to make an accurate apportionment of the total extra costs, an arbitrator may make individual financial awards in respect of claims which can conveniently be dealt with in isolation and a supplementary award in respect of the financial consequences of the remainder as a composite whole. However, the Privy Council observed that the use of global claims should have no bearing upon the obligations of a plaintiff to plead his case with sufficient particularity.

The need for particularised pleading, however, is only to the extent of enabling the opposing party to make a proper reply, and not to be overly vexatious. In the case of British Airways Pension Trustees Ltd v Sir Robert McAlpine & Sons (1994), the defendants asked to be given detailed information as to how much of the diminution in the value of the property could be attributed to each and every defect and when not provided the judge ordered that the claim  be struck out. The Court of Appeal reversed the decision. The Court of Appeal held that the purpose of pleadings is to enable the opposing party to know what case is being made in sufficient detail to enable that party to properly answer to it and there has been a tendency to forget this purpose and to seek particularisation even when it is not really required.

Another case which has recognised the use of global claims is that of Inserco Ltd v Honeywell Control Systems (1996), where the court referred to Crosby and acknowledged that an extremely complex interaction between the consequences of various breaches, variations and additional works may render it impossible to make an accurate apportionment of the total extra cost between the several causative events.

In summary, the complexity of contemporary claims sometimes needs to be dealt with by a “global” approach, but this is not a carte blanche for the plaintiffs to put in any figure. Detail need to be provided where it is available. However, demands for particulars are not to be used as a delaying tactic, nor as an end in themselves.

Written by: Lim Jin Wen, pupil-in-chamber
Edited by: Chan Kheng Hoe
M/s Kheng Hoe is a focused construction dispute practice. For any queries with regard to construction matters, you may e-mail khenghoe@khenghoe.com.