The subject of concurrent delay continues to be topic of much debate, with several different authorities reaching different conclusions. A recent case in the TCC has added to that debate, suggesting that the correct approach is to move away from the "first in line" approach and instead focus on effective cause. Here, Fieldfisher Senior Associates Sarah Shafiq and Alex Delin explain what happened.In Thomas Barnes & Sons Plc v Blackburn with Darwen Borough Council  EWHC 2598 (TCC), the Employer, Blackburn with Darwen Borough Council, appointed Thomas Barnes & Sons PLC, the Contractor, to build a new bus station for £4.4 million pursuant to a JCT Standard Building Contract, with Quantities, 2011 edition (Contract).
Following significant delays, the Employer eventually sought to terminate the Contract by sending a Notice of Termination (Notice) to the site instead of the Contactor's registered address, as required under Clause 1.7.4 of the Contract.
The Court held the Notice was invalid.
Luckily for the Contractor, the Court also held the Notice could be treated as accepting the Contactor's earlier repuidatory breach of the Contract for failing to proceed with the works regularly and diligently and effectively suspending for not being granted an extension of time, so no harm was done to the Employer for sending the Notice to the wrong address.
Had the Court not reached that finding, the Notice itself could have constituted a repuidatory breach of the Contract by the Employer, entitling the Contractor to damages.
The original works continue
The Employer appointed others to complete the original works and the Contractor entered into administration for which it blamed the Employer. As a result, the Contractor's administrators sued the Employer for approximately £1.7 million. The sum consisted a true measure of the works the Contractor considered it had completed prior to termination, loss of profit and loss and expense as a result of delay.
The Employer considered it was due about the same amount from the Contractor for having to appoint others to complete the works, but the Employer did not pursue that counterclaim on the basis the prospect of recovery was minimal.
The Contractor's claim was dismissed, and how the Court came to that decision will be of considerable interest for claims to extensions of time and loss and / or expense.
The delay blame game
Both sides blamed the other for delay, and relied upon critical path analyses. The Contractor's expert relied upon an as-planned versus as-built windows analysis whereas the Employer's expert relied upon a hybrid of a time slice windows and time impact analysis.
The Contractor's expert was cross-examined on the basis that he had not in fact followed the as-planned versus as-built method, whereas the Employer's expert was cross-examined on the basis that it was inappropriate to use the time slice windows analysis as that was more suitable for a prospective than a retrospective analysis.
In the end, the Court advised it would be wrong to attach too much importance to a close analysis of whether each had properly chosen or loyally followed the particular method selected and cited the SCL Delay and Disruption Protocol's recommendation to apply a common sense approach.
Both critical path analyses were found to have force, and the Court found that as long as one can explain the reasons for choosing a delay methodology over another an analysis will be given weight.
The Court cited the well-known authority in Walter Lilly & Company Ltd v Mckay  EWHC 1773 (TCC) to confirm that approach. However, the Court did explain that if an expert selects a method which is manifestly inappropriate for the particular case, or deviates materially from the method which he has said he is following, without providing any, or any proper, explanation, that can be a material consideration in deciding how much weight to place on the opinions expressed by the expert.
The importance of concurrency
In determining the cause and consequences of delay, concurrency became a big issue because the Contractor considered the roof covering works, risk for which was allocated to the Contractor, were not on the critical path, whereas the Employer considered they were in circumstances in which delay was felt by another unresolved issue, being hub steel deflection, risk for which was allocated to the Employer.
The Judge decided both were on the critical path:
"In my judgment this is a case where these causes were concurrent over the period of delay caused by the roof coverings. That is because completion of the remedial works to the hub structural steelwork was essential to allow the concrete topping to be poured and the hub SFS to be installed, without which the hub finishes could not be meaningfully started, but completion of the roof coverings was also essential for the hub finishes to be meaningfully started as well…The plain fact is that both of the works items were on the critical path as regards the hub finishes and both were causing delay over the same period."
Both parties agreed where concurrency is found, subject to the precise wording of a contract, a contractor is entitled to:
- an extension of time if the other party's risk was an effective cause of the delay even if there was another concurrent cause which was the contractor's responsibility (in other words, the contractor is entitled to a defence to a claim by the employer for liquidated damages); and
- loss and / or expense only if the contractor satisfies the 'but for' test, meaning if the concurrent cause which was the contractor's responsibility also would have caused delay the contractor will not be entitled to money.
Notably, the position is different in Scotland, where responsibility for concurrent delay can be apportioned, which the Inner House confirmed in City Inn Limited v Shepherd Construction Limited  CSIH 68. Apportionment has not held to apply in England and Wales, including in De Beers UK Ltd v Atos Origin It Services UK Ltd  EWHC 3276 (TCC) which was heard only a few months later, with Mr Justice Edwards-Stuart re-stating the Malmaison principle.
Parties continue to debate the meaning and effect of concurrency.
Where the general rule applies, it is in a contractor's interest for it to be found concurrency does not exist so that it can attain entitlement to both time and money. In more recent times, the Courts have leant more weight to the delay event which was felt first – that is to say, the party which caused the delay first will be stung irrespective of whether the other party subsequently causes delay too.
While City Inn criticised that approach, in Adyard Abu Dhabi v SD Marine Services  EWHC 848 (Comm) the Court held concurrency meant “a period of project overrun which is caused by two or more effective causes of delay which are of approximately equal causative potency", and in Saga Cruises BDF Ltd & Others v Fincantieri SPA  EWHC 1875 (Comm) a contractor was found to have caused delay first meaning it was not entitled to an extension of time when the employer subsequently caused delay as well. The difficulty is one of causation – the party which first caused the delay may find it more difficult to demonstrate a subsequent delay, responsibility for which does not sit with them, impacted the completion date.
Adopting the same approach in Thomas Barnes would have meant the Contractor would be entitled to money as well as time. If delay was first felt by not completing the hub structural steelwork, with the delay of the roof coverings being felt thereafter, a strict interpretation will be concurrency is not held to exist. However, the Court moved away from the "first in line" approach and followed the "effective cause" test, summarised by the editors of Keating on Construction Contracts 11th edition as follows:
“In respect of claims under the contract:
(i) depending upon the precise wording of the contract a contractor is probably entitled to an extension of time if the event relied upon was an effective cause of delay even if there was another concurrent cause of the same delay in respect of which the contractor was contractually responsible; and
(ii) depending upon the precise wording of the contract a contractor is only entitled to recover loss and expense where it satisfies the “but for” test. Thus, even if the event relied upon was the dominant cause of the loss, the contractor will fail if there was another cause of that loss for which the contractor was contractually responsible.”
Accordingly, the Court found concurrency existed given the parties agreed a contractor is not entitled to money when there existed another effective cause of delay for which the Contractor was responsible (i.e. the "but for" test). The Contractor was therefore awarded an extension of time, but not loss and expense for the same period.
The judgment raises more questions over the treatment of concurrent delay, shifting the direction in which the Courts were travelling from focussing on which delay event came first to a contractor having to demonstrate but for an employer's delay completion would have taken place as planned. Additionally, it may be in future a more pragmatic and 'common sense' approach will be favoured when attaching weight to different delay methodologies.
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