In our latest guest blog, new members of the CIF, Decipher Consulting, take a look at how delays to construction projects might best be assessed, demonstrated and managed.
The past year has thrown some significant challenges at the construction industry. Brexit looms ever closer, and ongoing issues caused by lockdowns resulting from the COVID-19 crisis have led to supply-chain and resource issues throughout Europe.
In the event that a delay should arise on your project, you will usually need to prove why it arose and demonstrate the resulting effect. Delay analysis is often seen as a ‘dark art’, something carried out using planning software that is a mystery to the majority of us. But it needn’t be so.
Whatever method is being used to analyse delay, a few things are essential for a successful delay claim:
First, Entitlement – has a delay occurred that is the other party’s risk?
For this first item, you may need a lawyer. Contracts can be complex and interlinked documents. Entitlement to compensation will very much depend upon the nature, content, and interpretation of the contract and supporting documents.
Standard form contracts may allow for an Extension of Time, and compensation in the form of damages (for certain delay events but not all). Some will allow for neither, or be modified as to make things ambiguous. A good solicitor will work with you and your team to examine what the contract actually means. They will also be able to identify alternative interpretations.
Item two: Demonstration of Cause and Effect.
This is something which many people find challenging. Often folk look at a project and say, “the project should have finished on x date, but it finished on y date, so the delay is y-x”.
However, you must show precise cause and effect. As everyone reading this will appreciate, construction projects are complex. Even the simplest project will encounter delays. Late delivery of materials (particularly relevant at the moment), delayed issue of drawings, variations to design, etc. Any number or combination of these factors may have an impact on progress.
The following three questions may help with identifying cause and effect:
- Is there an effective cause?
- Is the suggested cause based on fact?
- Has common sense been applied?
A good delay analyst will be able to separate different causes and identify their effect upon progress or completion. The analyst ought to trace a clear evidential link from cause to effect. They should separate out the activities which had a critical impact upon the programme. The demonstration of a factual cause is important, it must be possible to substantiate any claims with facts.
The usual approach is to consider cause first and then effect. However, many of the methods now advocated by the Society of Construction Law Protocol now look at analysis the other way around. Calculating the effect of delay first and only then considering the cause is often the preferred approach for ‘retrospective’, after the event analysis.
Item Three: Records.
This is one of the most neglected and difficult areas faced by delay analysts. We frequently come across situations where a strong claim and good analysis is made impossible by a lack of records. The importance of keeping good, accurate, clear and structured records cannot be overstated. Particularly for the production of a good and useful delay analysis.
The required demonstration of cause and effect cannot be achieved without good, structured records. It seems that human nature is to assume that everything is going to be fine. Constraints on budget, time, etc all conspire to lead to the poor management of construction records. Only too late do people realise the importance of the late, great Max Abrahamson’s mantra of the importance of records.
There are several guides to what records should be kept and how. The SCL Protocol gives some guidance and examples, as does the CIOB guide to Time Management in Complex Projects.
There are many factors that go to make up a good delay analysis, but the above three factors can help to ensure a greater chance of success. To find out more about delay analysis and how Decipher can assist you, take a look at the website www.decipher-group.com .