Delays, disruptions, incomplete work, and financial losses

The case of A & V Building Solution Ltd v J & B Hopkins Ltd [2024] EWHC 1510 (TCC) centers on a construction dispute arising from a sub-subcontract between A & V Building Solution Ltd (A & V) and J & B Hopkins Ltd (J&BH) in connection with plumbing works for the Moulsecoomb Campus student accommodation development at the University of Brighton. Several key issues require critical analysis:

1. Nature of the Dispute

The dispute primarily revolves around the valuation of the works A & V carried out, delays and disruptions, and liability for incomplete works. A & V left the project in March 2021, with unfinished works, which is not in dispute. The trial focused on determining the value of work completed, A & V’s claims for losses due to disruptions, and J&BH’s counterclaims for losses caused by A & V’s premature departure.

Analysis: The judgment highlights the complexity of construction contracts, especially in multi-tiered subcontracting arrangements. A & V’s departure from the project was both a cause and a symptom of the problematic working relationship, where both parties struggled with delays, disrupted schedules, and financial constraints. A key challenge in this case is distinguishing between delays caused by external factors, such as the COVID-19 pandemic and Bouygues UK Ltd’s (the main contractor) failings, and those attributable to A & V.

2. Performance and Delays

A & V claims that J&BH, acting as the main contractor, failed to provide access to work areas in accordance with the contract schedule, which delayed their work. A & V raised several complaints about BYUK’s failure to provide work areas and the subsequent impact on their ability to meet deadlines. On the other hand, J&BH argues that A & V’s labor productivity was below expectations and that their irregular working hours contributed to the delays.

Analysis: The case illustrates the difficulties in proving which party is at fault for delays in construction projects. A & V’s argument that BYUK’s failure to provide work areas is valid but could have been better documented. Meanwhile, J&BH’s argument about A & V’s irregular working hours suggests mismanagement on A & V’s part. However, the evidence of prior good performance by A & V complicates this narrative. This dispute also underscores the importance of clear communication and robust documentation when construction schedules are impacted.

3. Financial and Contractual Discrepancies

The judgment details competing valuations of the works. A & V claims the value of the work they completed before leaving the project is ￡413,940, whereas J&BH values it at ￡338,683. Additionally, A & V seeks compensation for ￡645,100.45 in losses, while J&BH claims ￡88,069.61 in contra charges for alleged breaches by A & V.

Analysis: The financial aspect of the case illustrates the common issue in construction disputes of how to value incomplete or unsatisfactory work. Both parties relied on expert witnesses, and while A & V’s testimony was found reliable, their financial claims from the spring of 2021 onward were less convincing. This highlights the critical role of expert testimony in quantifying damages and the difficulties small contractors face when claiming for financial losses in complex construction contracts.

4. Impact of Representation

The judgment notes that A & V was not legally represented throughout the hearings, with Mr. Paduraru, a director of A & V, representing the company, aided by a surveyor. J&BH, on the other hand, was consistently represented by legal counsel. The court allowed non-lawyer representatives for A & V, but there were limits to their effectiveness in navigating the complexities of the case.

Analysis: This aspect underscores the challenges small companies face in construction litigation, especially when unrepresented or represented by non-lawyers. It suggests a power imbalance between the parties and raises questions about the accessibility of justice for smaller entities in highly technical construction disputes. The court’s willingness to permit non-legal representation shows some flexibility but also highlights the limitations of such representation in complex litigation.

5. COVID-19 and External Disruptions

A significant portion of the delay was attributed to external factors, particularly the COVID-19 pandemic, which caused a two-month site closure. Both parties agree on the timeline of the closure, but the consequences of the shutdown on A & V’s financial position and ability to complete the works are disputed.

Analysis: The impact of COVID-19 on this case illustrates the broader effect of the pandemic on construction contracts. The pandemic introduced new risks and complexities, such as the need for social distancing and changes in labor allocation, which disrupted the normal flow of work. While A & V argued these external factors caused delays, J&BH’s defense focused on internal management issues within A & V. This highlights the need for clear contractual provisions to deal with force majeure events like pandemics.

Conclusion

The case of A & V Building Solution Ltd v J & B Hopkins Ltd is a classic construction dispute involving delays, disruptions, incomplete work, and financial losses. Both parties presented legitimate claims, but the evidence favored J&BH on issues of labor inefficiencies and incomplete works, while A & V’s arguments about external delays were somewhat mitigated by their lack of formal legal representation and documentation. The judgment illustrates the complexity of construction litigation, particularly for smaller subcontractors facing larger, better-resourced contractors.