Practical Law

It’s been interesting to follow some of the debate in the legal press and online about whether there is a new line of authority developing in England and Wales about concurrent delay under a construction or engineering contract.

To simplify, concurrent delay refers to a period when two events have occurred, both of which delay the progress of the works under the contract, and:

• one event is the contractor’s fault or responsibility under the contract; and
• the other event is the employer’s fault or responsibility under the contract.

The issue that often arises in this situation is whether the contractor should be entitled to more time (and more money) to complete the works.

The recent case that has reignited a debate is the Technology and Construction Court’s (TCC) judgment in De Beers v Atos, given by Edwards-Stuart J.

De Beers v Atos

The section in the judgment that seems to have awakened much of the comment is paragraphs 169-180, in particular paragraph 177, which says (emphasis added):

“The general rule in construction and engineering cases is that where there is concurrent delay to completion caused by matters for which both employer and contractor are responsible, the contractor is entitled to an extension of time but he cannot recover in respect of the loss caused by the delay. In the case of the former, this is because the rule where delay is caused by the employer is that not only must the contractor complete within a reasonable time but also the contractor must have a reasonable time within which to complete. It therefore does not matter if the contractor would have been unable to complete by the contractual completion date if there had been no breaches of contract by the employer (or other events which entitled the contractor to an extension of time), because he is entitled to have the time within which to complete which the contract allows or which the employer’s conduct has made reasonably necessary.”

A debate beyond the court’s expectations

Many books, papers and articles are written about delay and concurrent delay in the construction and engineering context, and this post only scratches one small issue on the surface of that debate. However, the debate stemming from this paragraph of the judgment may have grown beyond the court’s expectations, when judgment was handed down.

Clearly, paragraph 177 refers expressly to “construction and engineering cases”. However, the facts of the dispute related to an IT services contract that had gone very wrong for the parties involved (see PLC Commercial’s brief update on the decision). While both IT services contracts and construction and engineering contracts are the bread-and-butter business of the TCC, it seems to us that the court did not intend paragraph 177 to summarise the whole line of authority relating to concurrent delay on construction and engineering projects (whether in England and Wales or in Scotland). In fact, it could easily be explained as referring to construction and engineering “situations” or “circumstances”, in place of the word “cases”.

The judgment does not refer expressly to the City Inn judgment that some commentators have compared it to, and neither does it refer to any criticism or support for that judgment (or to other English authorities on concurrent delay). It does not refer to any construction and engineering standard forms of contract and how they operate, but does refer extensively to the parties’ own bespoke IT services contract.

Conclusion: wait for another one?

We suggest that the De Beers v Atos judgment may not have moved the debate on concurrency in construction and engineering disputes any further forward. This will have to wait until the concurrency issues raised in City Inn (or similar issues) are before the TCC or a higher court again, most likely where the dispute relates to a construction or engineering project.