If a contractor delays, then he may be subject to pay LAD. If an employer is in default, on the other hand, then the contractor would be entitled to an extension of time, or otherwise time would be made at large.
But what happens when both employers and contractors have some part to play in the delay? For example, the contractor may be slow in its progress of works, but at the same time the employer may have also delayed in handing over the site. Such concurrent delays may lead to construction disputes.
The major issue when there are concurrent delays is to establish how much extension of time the contractor is entitled to. To resolve this problem, there can be a number of approaches.
One approach is called the “Dominant Cause Approach”. For this approach, one must determine what is the dominant cause of the delay, and grant extension of time according to the dominant cause. This “Dominant Cause Approach” was accepted by the Court in Leyland Shipping Co Ltd v Norwich Union Fire Insurance Society Ltd.
However, this approach has not been accepted all the time. The Court in H Fairweather & Co Ltd v London Borough of Wandsworth rejected it.
A second approach to deal with concurrent delays is the “but for” approach. In other words, “but for” the delay by the contractor, would an extension of time nevertheless be required? This was the preferred approach in Quinn v Burch Bros (Builders) Ltd.
A third approach is to use the apportionment approach, to apportion the extension of time required between the employer and the contractor based on their responsibility for the delay. This was the preferred approach in Tennant Radian Heat v Warrington Development Corporation.
It would seem therefore that there is no uniform approach. At the end of the day, the construction court is merely seeking, using the best of their ability, to ascertain how much extension of time would be fair based on the factual matrix of the case.
And in construction cases, it is not what are the real facts on site that would ultimately count, but what has been properly documented. Herein lies the biggest challenge for construction companies across the board.
Kheng Hoe Advocates
Building contract and construction contract dispute lawyers
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