The 12 construction tips of Christmas

For many, the lead-up to Christmas is a marathon: trying to hit deadlines at work, attend Christmas parties, carol services and school plays, decorate the home and do all that shopping.

If that is not stressful enough, imagine what happens when an unexpected hitch occurs. 

Over the years, we have had clients call us for advice on all sorts of last-minute issues that arise on their construction projects that threaten to ruin their Christmas. 

Lucilla Waugh, partner in our construction and engineering team, discusses 12 last-minute issues that could happen, and how to fix them (using just a tiny little bit of poetic licence!).

1. Office refurbishment gone wrong

“NOT A Silent Night”

It’s Christmas party time. The drummers drumming, the pipers piping, the lords a-leaping and the ladies dancing are causing a hell of a racket and are running amok. Some overexcited employees decided it would be a good idea to paint the town red. Well, not the whole town, just the walls of the almost completed newly refurbished office extension. It meant the contractor could not complete the works in time for the office opening planned for 2 January.

Advice

• notify the client’s insurers of the damage. As is usual with works to an existing building, under its JCT building contract the client was insuring both the existing building against specified perils and had taken out joint names All Risks insurance in relation to the extension works;  
  
  
• check whether the insurance included Delay in Start Up cover for loss of revenue/gross profit and costs as a result of the delay to scheduled opening; and 
  
  
• review the employment contracts to see what action could be taken against the employees.

2. Unwanted birds nesting

“On the 7th day before Christmas, my true love sent to me 7 swans, 6 geese, 4 colly birds, 3 French hens, 2 turtle doves and a partridge (but sadly not a turkey)”

A client called us to say that some birds had decided to nest on the construction site and wanted to know if they could get rid of them or if the birds were the contractor’s problem.  

Advice

• no-one should move birds without checking the plethora of legislation, not least the Wildlife and Countryside Act 1981, the Conservation of Species and Habitats Regulations 2017 and Natural England guidance;
  
  
• if the birds are protected, and Natural England doesn’t grant a licence to move them, it is a criminal offence; and
  
  
• whether the risk of delay caused by the birds sits with the contractor depends on what the building contract says. The most likely place to find the answer is in the list of grounds that entitle the contractor to extensions of time and loss and expense. It would be unusual for birds to be expressly mentioned but obligations in relation to site possession and obtaining consents, site condition risk and force majeure would be the place to look.

3. Tree preservation order

“Rocking around the Christmas Tree”

A client rang to say that he had discovered that a tree within the construction site was subject to a tree preservation order, aka a TPO, and no-one had picked this up before work started.

Advice

• a TPO prohibits cutting down, topping, lopping, uprooting the tree or causing wilful damage or destruction to it, without the planning authority’s consent; and
  
  
• there are some exceptions to where consent is needed, one of which is where the felling of the tree is "necessary to implement a planning permission". Thankfully, the client had obtained planning permission, so crisis averted, and the client took the tree home and rocked around it late into the small hours of Christmas morning.

4. Ancient artifact discovered

“On the 5th day before Christmas, as if birds and trees were not enough, my true love sent me 5 gold rings”

A contractor come to us for advice in relation to a Roman gold coin embedded in rock that he had excavated on site.

Advice

• the coin did not belong to him, which put an end to his initial stage of euphoria and dreams of a lavish Christmas;
  
  
• under his JCT contract, all antiquities, fossils and other objects of interest or value found on site during construction became the property of his employer. He had to fess up to the employer and hand over the loot!;
  
  
• the contractor had to use best endeavours not to disturb the precious coin, stop work if there was a risk of endangering the coin or impeding its excavation and removal and take all steps necessary to preserve it; and
  
  
• the good news was he was entitled to a fair and reasonable extension of time and loss and expense for delayed caused.

5.     Snow disruption

“(Don’t) let it  snow”

As much as we love building snowmen and sledging, snow is a nuisance when it comes to building works.

A client called us to say that snow “had stopped play” and she wanted us to advise on whether she could claim damages from her contractor for the delay in completing the works.

Advice

• building contracts typically provide that contractors are entitled to an extension of time but not to loss and expense for exceptionally adverse weather.  NEC contracts are one exception, where the contractor can claim both, where a recorded weather measurement has occurred less frequently than once every ten years (on average) when compared to historic weather records for the local area; and  
  
  
• in this instance, NEC was not used but the standard JCT contract without quantities 2016 was. So the client couldn’t claim damages for delay but neither could the contractor claim any loss and expense for the period of delay. The contractor’s position might have been different if the client had been responsible for delay which pushed the contractor into working in this snowy period but that was not the case here.

6. Site patrols during shutdown

“Baby, it’s cold outside”

Building contractors typically shut down for Christmas for a couple of weeks to enjoy a well-earned break. This means their construction sites are unattended, which can be a prime time for thieves and vandals to wreak havoc. 

Unfortunately, this is exactly what happened to one contractor client on 23 December. It looked like he would be spending the festive season patrolling on-site in the freezing cold, not in the comfort of his warm and cosy home with loved ones.

Advice

• whilst the contractor had insurance to cover the loss and damage, this situation is not something he wanted to experience again in hurry and so the top of the list for January was to reconsider future security measures for his construction sites , including the installation of locks, barriers, screens, access control systems, CCTV, monitored alarms, secure shelters for plant and equipment, tracking systems and security companies; and
  
  
• Fort Knox, eat your heart out!  

7. Argument over contract terms

“Oh no, he didn’t”, “oh yes, he did!”

As much as we love a panto, having a good old argument might feel like fun, but you might not get what you expect. A client came to us for advice on its contractor’s liability for defects that had appeared in its storage warehouse.

The client had assumed that his terms of business prevailed over the contractor’s terms and conditions.

Advice

• not so! Unfortunately, on a review of the correspondence that was exchanged between them before work started, we concluded that the contractor had won the “the battle of the forms”; and
  
  
• this meant there was a cap on the contractor’s liability and that meant the client was not entitled to recover the full amount of its costs of re-locating to alternative premises, making good the defects and loss of business and profits.

8. Contract deeds

“All I Want for Christmas (is my project finally completed)” 

Another client had a similar defects problem caused by defective design 8 years earlier.

Advice

• not only was it unclear what terms and conditions were included in the contract, the client was out of time for making a claim in any event because, as there was no written contract that had been signed as a deed, the client only had 6 years to commence legal proceedings for its losses and that time had passed; and
  
  
• don’t leave your Christmas wish list up to Father Christmas! Be clear what you want and write it down. Always consider whether the contract should be executed as a deed to extend the period for bringing breach of contract claims to 12 years.

9. Unreasonable extension of time

“I DON’T wish it was Christmas every day”

A contractor told us that its employer had granted it an extension of time for delay caused by a request by the employer to vary the works.

However,  the extension was only for two weeks and this occurred over the Christmas break when the construction industry shut down.Therefore, the contractor would still be liable to pay liquidated and ascertained damages for some delay.

Advice

• the two-weeks was neither fair nor reasonable as it took no account of the shut down for Christmas; and
  
  
• we successfully obtained a three-week extension to the extension!

10. Last-minute adjudication

“NOT Driving home for Christmas” 

A client received an adjudication notice from a contractor on Christmas Eve for unpaid interim accounts. It is not uncommon for an aggrieved party to a construction contract to refer a dispute to adjudication just before Christmas.

This tactic is adopted in an attempt to get the other party to agree a resolution to the dispute; avoiding spending the Christmas break in the office sifting through mounds of papers in order to respond to the adjudication referral notice on time.

Advice

• apply to the adjudicator for an extension of time;
  
  
• if not given, either make the payments or call everyone back into the office to prepare the response!  Unfortunately for them and us, the Christmas break was much shorter than planned!

11. Separating multiple adjudications

“I WON’T be home for Christmas”

A client had a number of disputes with its contractor and asked us if it was possible to adjudicate each separately but concurrently before different adjudicators, rather than wait to adjudicate them altogether when they had fine-tuned all their claims.

Advice

• this was possible; and
  
  
• the contractor would have to convince the court that the conduct is unreasonable or abusive and only in exceptional circumstances would a challenge to an adjudicator’s jurisdiction be successful and injunction to stop an adjudication be granted.

As it happened, the client decided to defer the commencement of the various disputes to the New Year so Christmas was not cancelled after all!

12. Festive payment periods 

“Stay another day”

A client called in a panic as he had agreed that the finance team could take the whole of the Christmas period off, without considering who would manage payments and notices that had to be made during that time. 

He would have to come into the office himself, and he needed to know how payment periods (and the periods for service of related payment and pay-less notices) were to be calculated under his JCT Design and Build 2016 contract for his development in London. 

Advice

• Saturdays and Sundays are not excluded from calculating the periods in which payments need to be made or payment/pay-less notices served;
  
  
• Public Holidays are excluded. They include Christmas Day, Good Friday and a day which under the Banking and Financial Dealings Act 1971 is a bank holiday., so 26th December where it is not a Sunday and 27th December in a year in which 25th or 26th December is a Sunday;
  
  
• the Crown can change those dates or create additional bank holidays. New Year's Day (or the next working day) has been proclaimed a bank holiday every year since 1974;
  
  
• JCT contracts also use the term “Business Days” (which include Public Holidays, Saturdays and Sundays) but they are used in other contexts; and
  
  
• there may be different bank holidays for projects in Scotland and Northern Ireland.

With only a few days left before the Christmas break, we hope that you do not experience any such last-minute hitches, but if you do, you know where we are!

More information on anything discussed in the article, contact Lucilla using [email protected] or 0191 211 7984.

“MERRY CHRISTMAS, EVERYONE!”