Anything Worth Doing…

04/08/2021

Whilst Greek philosophy is not readily associated with the UK construction industry, a few of the more ‘entry level’ quotations are highly relevant to how we conduct ourselves on an individual basis when completing the day job. One of my personal favourites is included above and is a recurring theme which is to be considered when reading this article.

The article addresses the thorny issue of ‘Global Claims’ and confirms to Contractors and Sub-Contractors alike that the Walter Lilly case is far from a ‘green light’ for the successful adoption of a global claim when seeking to demonstrate entitlement. This may not make overly pleasant reading for those looking to promulgate a claim on such a basis however I feel it is important to share this information; after all to quote Aristole again……”A friend to all is a friend to none”.

As regular readers (and why wouldn’t you be?!) of In Focus will know, Pyments often make reference to the SCL Delay & Disruption Protocol (2nd Edition) when seeking to demonstrate / ascertain entitlement to additional time and / or additional money. In respect of retrospective delay analysis, the Protocol sets out appropriate methodologies depending upon a particular set of project specific circumstances. The Protocol attempts to cater for all eventualities and all level of records available.

It is therefore surprising that in this digital age and with improvements in record keeping, why global claims for entitlement to time are still promulgated, and if anything would recently appear on the rise.

The Protocol defines a global claim as “one in which the Contractor seeks compensation for a group of Employer Risk Events but does not or cannot demonstrate a direct link between the loss incurred and the individual Employer Risk Events”. Further, Keating on Construction Contracts defines global claims as “one that provides an inadequate explanation of the causal nexus between the breaches of contract or relevant events / matters relied upon and the alleged loss and damage or delay that relief is claimed for”. There are mixed definitions on what constitutes a global claim and no hard and fast rule, albeit all sources appear to agree that such a claim fails to adequately explain the cause and effect of delay and the losses attributable to the delay in question.

The history of global claims may well explain the current trend in its use. Historically, a global claim would fail in its entirety if it could be proved that one part of the delay or loss in a global claim was caused by a ‘not merely trivial’ culpable event. This was often referred to as the ‘Exocet’ defence. The Courts appeared to soften this position in Doyle v Laing (2002) where the culpable event no longer had to be ‘not merely trivial’ but had to be ‘significant’ or dominant in order for global claim to fail.

Walter Lilly v Mackay (2012), changed the law further wherein Judge Akenhead clarified global claims should not fail in its entirety if it was found the claimant was in part responsible for a delay; instead, the claim should simply be reduced by the contributing culpable event. It would seem therefore, similar to the missile which bore its name, the ‘Exocet’ defence was no more. In cognisance of Walter Lilly, The Protocol recognised a new “trend for the courts to take a more lenient approach when considering global claims”. However, The Protocol still actively discourages the promulgation of global claims and supports fully particularised and appropriately apportioned assessments of entitlement to additional time and money. In short, “Anything worth doing, is worth doing well”. Some sections of the industry appear to rely upon this recognised leniency toward global claims, which when combined with the relatively low-cost investment in producing global claims, appears to have contributed to my perception that global claims are increasingly common. When considering appropriate demonstration to additional time and money Walter Lilly should not be purely relied upon as a Case which ‘opened the door’ to global claims being an accepted industry norm. It is important not to gloss over the conclusion from Judge Akenhead which are now commonly referred to as the ‘Seven Principles for Global Claims to Succeed’.

The breadth of these principles are not detailed within this article, save reference to two key elements;

Judge Akenhead noted there is no need for a court to go down the global route if the actual cost to each attributable loss / event can be readily or practicably determined; and

If a party chooses to go down a global claim route, when a case could have been produced showing causation, a tribunal will look at it sceptically.

These principles are fundamental and commonly overlooked by parties when providing reasoning to their use of global claims. Failing to adhere to these principles may well lead to a global claim being dismissed.

As with most modern construction projects, data and records are routinely collated and exchanged between the parties to a Contract. Most often than not, and usually as a bare minimum, updated progress programmes are provided by the Contractor as part of the monthly progress reports. Whilst the quality of this information varies, there is usually sufficient data that exists to analyse and sever delays and associated losses i.e. a traditional analysis can be undertaken.

Given that in most instances both parties will have similar if not the same level of records, and such records facilitate a traditional form of analysis as per the guidance of The Protocol, it would seem a risky strategy for a claimant to promulgate a global claim in lieu of a traditional recognised method. Don’t be fooled into thinking a global claim will be successful, and is an appropriate substitute for doing a ‘proper job’.

After all…

“Anything worth doing, is worth doing well”

For information about delay analysis, project record keeping and commercial and/or contractual advice please do not hesitate to contact Stuart Neville at stuart.neville@pyments.co.uk

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