Proving Your Claim And What Needs To Be Done Now

• Published date: 15 December 2020
• Subject Matter: Corporate/Commercial Law, Real Estate and Construction, Coronavirus (COVID-19), Contracts and Commercial Law, Construction & Planning, Litigation, Contracts and Force Majeure
• Law Firm: Fenwick Elliott LLP
• Author: Mr Jon Miller

Having reviewed their construction contracts, the next major concern was how parties should tackle proving any potential claims. In what is in effect Part 2 of his summary of the impact of COVID-19, Jon Miller provides some practical examples of the issues that need to be addressed. Advice that holds true for any construction claim.

Delays

Only delays to the Completion Date can give rise to an extension of time. Programming information is crucial. The burden is on the party making the claim to show why the COVID-19 shutdown delayed the Completion Date.

Most sites are able to continue working safely. We are aware of a site where working practices have been changed whereby there is no more than one operative in each room, operatives start at different times and ensure they maintain a distance of 2 metres throughout.

But even then this will give rise to delays to the progress of the Works - i.e. changing working arrangements which slow progress may still give rise to an extension of time if they delay the Completion Date (and additional recoverable costs if the construction contract allows it).

How many people were supposed to be on site? Who was self-isolating/ill/had a pre-existing condition? What trade(s) were they and where were they supposed to work?

Was there a lack of supplies/materials? If so, when were they to be delivered (and eventually when did delivery take place)?

Nearly all construction contracts impose a need to mitigate/use best endeavours to reduce delays.¹ Record all attempts to try and find alternative labour and get new delivery dates - i.e. keep emails.

Best endeavours - a new weapon?

Many contracts contain a provision whereby the contractor is to use their "best endeavours" to mitigate delays.² We have experienced responses to requests for an extension of time whereby contractors and subcontractors have been reminded of their duty to use best endeavours and asked for an explanation of what they have been doing to discharge this responsibility.

What is "best endeavours"?

Unfortunately (yet again) there is no definitive legal answer. Explanations have been given whereby:

• "Best endeavours means what it says - it does not mean second best endeavours."³
• "Best endeavours are something less than efforts which go beyond the bounds of reason but are considerably more than casual and intermittent activities."⁴
• "This proviso [to use best endeavours] is an important qualification of the right to an extension of time. Thus, for example, in some cases it might be the Contractor's duty to re-programme the Works either to reduce or prevent delay. How far the Contractor must take other steps depends upon the circumstances of each case, but it is thought that the proviso does not contemplate expenditure of substantial sums of money."⁵

I suggest that a "best endeavours" obligation would include:

• if the site is shut down, continuing with off-site activities insofar as they can safely be carried out (e.g. design, but this might even include off-site prefabrication);
• reprogramming the Works in accordance with the SOP;
• looking at the possibility of replacing labour who cannot attend site (e.g. due to illness or self-isolation), even temporarily.

The key point as always, legally speaking, is to make sure that all efforts to use "best...