TONY BINGHAM Is an Arbitrator, Mediator and Barrister. As well as that, Tony is a renowned writer, commentator and lecturer.
Calculating Extensions of Time
A FORESIGHT SAGA
Assessing an extension-of-time dispute is a tricky business. Delay experts need to be able to transport themselves back to the time of the delay and take in the view from there.
ALL THE ARCHITECT HAS TO DO IS TAKE THE EVENT AS HE SEES IT, THEN GET HIS MIND TO BEHAVE WITH THE FORESIGHT OF A HEBREW PROPHET
Top delay analyst John Marshall of EC Harris blinked hard at the explanation of extension of time machinery in Walter Lilly vs MacKay. So did I. He has written a splendid piece on it in the newsletter of the Technology & Construction Bar Association. He tells us that two delay experts, as opponents to each other, told the court how the JCT extension of time rules worked. Oh dear, oh dear that looks wrong, said I. On the other hand, Walter Lilly vs MacKay was special on its own facts. Marshall figured out why these two experts said what’s what.
First, Marshall tells us what gives in “more usual disputes”. Let’s look. Everyone in construction is interested in the frightening business of liquidated and ascertained damages (LAD) for not hitting the contract completion date. Rather like the community chest card in Monopoly, the employer picks up squillions of pounds in damages. On the other hand, if the reason for the delay is found to be the employer’s responsibility, the get-out-of-jail-free card says: “An extension of time is awarded … get back the LAD from the employer or don’t pay.”
It works, or should work, like this: the builder tells the architect he is now in delay. The architect asks himself if the delay is likely to cause the end date to be pushed out. If so, the architect awards an extension of time by fixing a new later date. All the architect has to do is take the event as he sees it, then get his mind to behave with the foresight of a Hebrew prophet. In short, he asks what the delay will do, as seen today on site, to the future end date.
That’s the “prospective” view. It’s a fair system. In this way the contractor knows what his new end date is, for better or for worse. And when, at last, practical completion is reached, the architect has to again crank the handle on the extension of time machine to see if his prophecy was right. He adds time if he was short-sighted or unexpected consequences of the earlier delay