Decoding Construction Delays: The Power of Four Crucial Questions in Time Extension Evaluation

Imagine a construction site bustling with progress. But what if time takes an unexpected turn? Explore with me as we delve into the skill of understanding delays, where four essential questions can steer the extension of time considerations in construction projects.

Construction contracts provide a specified timeframe for project completion, but these deadlines are not set in stone and can be extended under certain circumstances. Such extensions can result from factors beyond the parties' control, including employer actions and unforeseen events.

Common Causes of Time Extensions:

From my extensive experience providing legal support for construction projects, several factors can lead to delays that warrant an extension of time for contractors. These include variation instructions, site access issues arising from protests or employer-related challenges, force majeure events, and government actions.

A recent addition to this list includes Nigeria's Naira redesign policy and the recent fuel price hike. If you're in Nigeria, these instances are likely familiar. In a project where my firm offered legal support, the contractor attributed reduced on-site personnel to the Naira redesign policy and fuel price hike, resulting in financial constraints affecting work progress.

The Four Crucial Questions:

My primary objective in construction projects is safeguarding the client’s interests while ensuring timely, budget-conscious, and quality project delivery.

I evaluate contractor’s extension of time claims based on contract the contract’s provisions and legal principles to guide the engineers/architects/contract administrators in their technical decisions. This approach is encapsulated in what I term "the Contractor's Four Quadrant."

These questions help me discern whether a contractor’s extension of time request is genuine or a mere ploy to cover up his non-performance.

Let's delve into these questions:

Question 1: Is the delay excusable?

Drawing from my familiarity with standard construction contracts like FIDIC, JCT, and NEC, the first thing I do is to identify delay events listed in these agreements that entitle contractors to extensions. I then assess the event's relevance to the contractor's claim and confirm their eligibility for an extension.

Generally, contractors are eligible for extensions if delays are attributable to employers or events beyond parties' control. However, it's crucial to verify that the contract allows for this.

As my boss consistently advises: “Check the contract, don't assume.”

Question 2: How critical is the delay?

Once a contractor's entitlement to an extension is established, the next thing I do is to ascertain whether the delayed activity is crucial to the project's critical path.

This involves the well-known critical path method, which project managers and contract administrators are familiar with. Under the law, extensions are not granted for delays outside the critical path.

This ensures that only delays impacting project completion are considered, and the total float must be exhausted before an extension can be claimed.

Question 3: Has the contractor complied with the notice requirements?

Many contracts I have assisted with include notice requirements that contractors must fulfil to be eligible for extensions. Timelines for issuing notices are common notice requirements in contracts.

The notices serve as a prerequisite for claiming an extension. It is important that I point that these notice requirements are not made to frustrate contractors. Rather, they provide engineers ample time to investigate and determine whether the claim is valid.

Ensuring proper notice compliance is critical to the extension's consideration.

My task is then to verify whether the contractor issued the notice in line with contract terms and recommend dismissing the extension request if the contractor failed to adhere to stipulated notice requirements.

Question 4: Has the contractor provided any supporting documentation?

Drawing inspiration from renowned construction lawyer and author Abrahamson's assertion on the significance of records, I emphasize the importance of supporting documents. These are contemporaneous records that help substantiate the contractor’s claims.

For instance, if the contractor claims that a shortage of on-site workers resulted from difficulties in obtaining cash to pay them, attributed to the naira redesign policy introduced by the federal government, I would need the contractor to furnish substantial evidence validating this claim. Records of pre-policy and post-policy site worker numbers and work rates can help provide essential evidence to validate the extension request's legitimacy.

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Concluding thoughts:

These four pivotal questions guide my evaluation of extension of time requests, which is primarily aimed at fulfilling the client’s objective of timely, budgeted, and quality project delivery. I am confident that contractors can also apply these questions to their own situations when considering an extension of time request. This approach will provide them with clarity and insight into the legitimacy of their claims.

Here are further points to note:

• While I recommend using standardized contracts like FIDIC, JCT, and NEC for their clarity and client protection, bespoke contracts should be drafted to incorporate these considerations.

• Regardless of the contract type, efficient contract management by knowledgeable individuals remains paramount. Eventually, a contract's beauty is in its practical implementation.

Keep in mind that the ultimate goal is ensuring that the client has its project delivered within specified timeframes, budgets, and quality benchmarks.

Have you considered additional questions apart from the ones I've provided? Please share—I'd be eager to hear your insights.

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