Article in Building Magazine, 5 July 2002

Just cool it

A draft delay protocol is supposed to take the heat out of the contentious area of delay. But as it stands, it could simply makes things worse

By Nick Henchie

The Society of Construction Law's protocol for determining extensions of time and compensation for delay and disruption has been downloaded, discussed, debated and written about for a number of months. Already a second draft has been produced, and the consultation process continues. We can expect further amendments in due course. No consensus it seems can be reached on anything in the protocol, least of all what its purpose is.

Although there can be no doubting the interest the protocol has generated on the issue of delay and programming, many people contend that it has achieved little else. It purports to provide the materials necessary for parties to avoid unnecessary disputes, but I suspect that in practice, where adopted by the parties, the protocol is more likely to lead to an increase in disputes and higher construction costs.

The protocol suffers from the fact that the drafters appear not to have considered whether what they have proposed as best practice, would, if adopted, assist in avoiding disputes on construction projects. The essence of the protocol is that detailed programming throughout the life of a construction project will enable delaying events, be they the responsibility of the employer or the contractor, to be accurately assessed and managed during the course of the project. Of course, such a proposal is put forward without the protocol having been tested on a single construction project, so its success or otherwise is necessarily hypothetical.

Among the solutions proposed by the protocol, and regarded by the drafters as best practice, is for the impact of every individual variation on a project to be plotted on to the programme using modern project-planning software to show the particular effects of each single variation on the programme. For a project of any size and complexity, the time and cost involved in carrying out such an analysis would be out of all proportion to any possible benefits that could be obtained. Even on straightforward contracts, variations quite often number many thousand.

Gauging the impact of all of these individually – even when there is no dispute as to delay – is an unnecessary burden to the contractor.

To then have to agree the impact with the employer, failing which the employer's decision stands (until overturned in adjudication) is a recipe for disputes. The further one gets down the contractual chain, the more ludicrous the recommendations of the protocol become.

Furthermore, it is naïve in the extreme to think that by addressing the factors that cause delay on projects, during the life of the project, the parties are more likely to resolve their differences.

Issues of delay are often as contentious during the course of a project as they are at the end, and sometimes more so. There is no evidence to suggest that adopting the protocol will reduce the chance of disputes. Often parties take commercial views on delays at the final account stage and wrap them up on a commercial basis. They are not able to take such a view during the infancy of a major project. The protocol takes no account of the fact that most construction projects do not end with disputes over delay and are not programmed with even a fraction of the detail and cost that the protocol recommends.

Everyone knows that proper programming, if not quite a prerequisite to a successful project, is at least a key factor. There is no doubt that parties to construction contracts should spend more time planning how a project is going to be constructed. However, they do not need the SCL to advise them of this, especially when no analysis of the likely cost of adopting their recommendations has been carried out. It will be interesting to see how many employers are willing to pay contractors to programme a project in such a way – and even more interesting to see if this avoids, or simply creates, further disputes. Perhaps this sort of analysis should have been carried out before such proposals were put forward as best practice.

Nick Henchie is a senior solicitor in the Construction & Engineering Group at Mayer Brown Rowe & Maw and can be contacted at nick.henchie@eu.mayerbrownrowe.com

Reproduced with permission from Building Magazine (http://www.building.co.uk)