Assessing delay



Assessing delay is perhaps the most underdeveloped area of law because there is presently little clarification from legal decisions as to what a claimant must demonstrate to support a claim for an EOT.

The entitlement to an EOT will depend on the actual terms of the contract. In the following case study the essential requirement was that the contractor must establish that the delay had in fact occurred because of the events that were the subject of the claim. Depending on the contractual test, a court must be satisfied that actual delay has occurred and will not rely on a theoretical computer modelling of delay.


CASE STUDY



Leighton Contractors Pty Ltd v South Australian Superannuation Fund Investment Trust

(1995) 12 BCL 38



Facts


  • Leighton contracted to build a $35 million office building. The contract stipulated a date for practical completion. This was extended by the architect with a certified EOT, although Leighton contended that they were completed prior to this date. The contract provided for a contract program in the form of a critical path time scale network which Leighton was required to follow.
  • Leighton claimed, amongst other things, for costs of delays.
  • Leighton contended that the introduction of the contract program and critical time path meant the EOT provisions did not apply and that a different procedure for EOT was implied.
  • Leighton produced a delay analysis, done by a process of computerized sequential modelling, which purported to demonstrate the effect of variations and other causes of delay and therefore an entitlement to costs based on a notional delay until the practical completion date.

Result


  • The process of sequential modelling disregarded the actual delay and took no account of actual events on site, such as the fact that actual progress did not keep pace with the program, nor of losses of time through non claimable delays due to inclement weather and industrial action.
  • The contract did not call for the production of a delay analysis after practical completion of the kind produced by Leighton.
  • The contract authorized a claim for extension of time only if the progress was delayed due to specified events. Thus, there must be actual delay caused by a specified event.

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Updated 23 June 2014