Delay and disruption claims and damages in relation to construction projects
Date
2016-03
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Stellenbosch : Stellenbosch University
Abstract
ENGLISH ABSTRACT: The project management triangle, also referred to as the “triple constraint” or the
“iron triangle”1 is a model of the constraints of project management. The triangle is used to illustrate that the success of project management is measured by the project
team’s ability to manage the project so that the expected results are produced while
managing time and cost. Events or circumstances may occur during construction
contracts which may delay or disrupt the execution of the works or cause loss of productivity.
All modern standard-form contracts provide for extending the date for completion under certain defined circumstances, but few contracts, if any, adequately address the question of on what basis exactly the extension of time is to be determined. This
uncertainty and inconsistency creates numerous problems for the contractors in planning their work prospectively, and consequent delays may result in severe
financial penalties, loss and expenses. This uncertainty and inconsistency may even have the completely opposite effect of relieving the contractor of his obligation to pay
penalties and leaving the employer with the unexpected consequence of being obliged to prove its damages.
Where the contract does not make express provision for an eventuality or the allocation of risk, the circumstance will be governed by common law. In other words,
if the contract is silent on some of above common issues, the parties will be obliged to revert to common law for the outcome of their dispute. The main source of
common law in relation to construction law is case law, of which there is a relative dearth in South Africa on the many issues that arise from the interpretation of
contractual provisions dealing with delay and disruption in construction projects. It is therefore important for contracts to provide expressly for risk allocation pertaining to possible delaying events and to determine the distinction between time risk and cost risk events. Delay and disruption matters, which may inter alia include issues involving extensions of time, penalties, critical path, ownership of float, concurrent delay, delay analysis methods, global claims, and time at large, among other factors, all too often become disputes that have to be decided by third parties, including inter
alia mediators, adjudicators, dispute review boards, arbitrators, and judges.
The number of such cases could be substantially reduced by the introduction of an unambiguous and consistent approach. This thesis will address the above concepts
by analysing the applicable legal principles involved. This will be done through an analysis of case law and legal writings, and a comparison of different standard
contracts from South Africa, England, and, to a lesser extent, other foreign jurisdictions.
This analysis will be applied and compared to the newly published JBCC suite of contracts (Edition 6.1 March 2014). Provisions of the JBCC extension of time
regimen that are inconsistent and conflicting and may create ambiguity will be identified, and the thesis will propose amendments. Furthermore, provisions which
are susceptible to time-at-large arguments will be analysed and appropriate amendments will be proposed. Finally, the thesis will endeavour to introduce Best
Practice Project and Risk Management principles through its proposed amendments.
AFRIKAANSE OPSOMMING: Geen opsomming
AFRIKAANSE OPSOMMING: Geen opsomming
Description
Thesis (PhD)--Stellenbosch University, 2016.
Keywords
Damages -- Law and legislation, Project management, Construction projects -- Risk management, UCTD, Penalties, Contractual