| Date | 17 November 1999 |
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| Judgment | Ascon Contracting Limited -v- Alfred McAlpine Construction Isle of Man Limited, TCC 19 October 1999 |
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| The Issue | Analysis of delay and disruption claims between sub-contractor and main contractor. |
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| Implication |
A case which emphasises that it is the claimant's burden to prove the effect in delay terms of the various causative event it claims when arguing for an extension of time. |
printClaims for delay and disruption between a main contractor and sub-contractor are generally not easy matters to deal with. Aside from the complexity of the factual basis of the claim, there are often many matters of principle which require to be handled: How are concurrent delaying factors dealt with? How should programme float be taken into account? By what means should liquidated damages imposed by the client be passed down to a sub-contractor? In what manner can so-called 'acceleration costs' be recoverable? What approach should be adopted to prove delay? Many of these matters were covered in the recent case of Ascon -v- Alfred McAlpine. McAlpine was the main contractor for erection of a five-storey building on the sea front in Douglas, Isle of Man. Ascon was McAlpine's reinforced concrete sub-contractor for the development, responsible in particular for floor slabs, basement perimeter walls, and columns between floors. Practical completion of the sub-contract works was granted just over 9 weeks late and Ascon claimed an extension of time of approximately 7 weeks. McAlpine's counterclaim included for recovery of £170,000 of liquidated damages which it alleged it had paid to the employer and which it argued derived entirely from Ascon's late completion of the sub-contract works. One of the first heads of claim concerned the allegation that McAlpine had failed to keep the site free from inundation from tidal sea water. His Honour Judge Hicks QC found McAlpine to be in breach of its obligations in this regard. Ascon claimed 22 days extension of time for this matter. Judge Hicks awarded only 6 days, 3 of those based upon a concession by McAlpine. Ascon's approach had been to show 22 days delay to its programme and infer that this delay was the result of the water ingress. This approach failed to consider that any of the delay may have been caused by Ascon itself. Ascon also argued that since McAlpine had established no other cause for the delay, Ascon's explanation was the only one which could be accepted. Judge Hicks was clear that such an approach reversed the burden of proof. There was a failure by Ascon, on whom the onus lay, to identify and prove a causative link between particular occasions of water ingress and specific periods of consequent delay. A further complaint by Ascon concerned an alleged failure by McAlpine to make available the foundations of a lift pit. It was argued that the lift pit was on the critical path and that it required to preceed the basement slab construction, which in turn preceeded frame construction. It is a common feature of construction claims that such arguments are often made too simplistically. Judge Hicks was unimpressed. Whilst completion of the lift pit might be necessary before completion of the subsequent elements, the sub-contractor nonetheless owed a duty to mitigate any potential delays. Adopting an entirely practical approach he held that whilst the lift pit was unavailable, the basement slab and columns could be continued. The area of slab around the pit which would have to be left undone was small. In Ascon's favour however, was Judge Hicks' approach to the question of acceleration. Having established that the non-availability of the lift pit caused some delay, it was not open to McAlpine to argue that no extension of time was due since future acceleration by Ascon could have eliminated the delay. That would have amounted to imposing on Ascon an obligation to incur expense in order to mitigate the consequences of McAlpine's breaches of contract. Such approval did not however extend to acceptance of Ascon's claim for acceleration costs. Judge Hicks noted that acceleration tends to be bandied about as if it were a term of art, with a precise technical meaning. He found nothing to persuade him that this was the case. Ascon's case was not that it had received any instructions to accelerate, but that it had generally been under pressure from McAlpine to complete earlier and had employed additional resources to that end. Ascon contended that the work was indeed completed sooner than it would have been in the absence of its accelerative measures. Judge Hicks held that it was plain that there cannot be both an extension of time to the full extent of delay with damages on that basis, and also damages in the form of expense incurred by way of mitigation, unless it could be proved that the mitigation or acceleration measures were reasonable yet ineffective. Since Ascon did not argue its case for acceleration costs on this basis, its claim must fail. Lastly of general interest was Judge Hicks' approach to the question of programme float. McAlpine argued that its programme for main contract works contained a float of 5 weeks. It argued that it had a discretion as to which sub-contractor might benefit from this float and accordingly that it might disregard such float in assessing the delay for which Ascon would be held responsible. Judge Hicks held that such an argument was misconceived. Not having suffered any loss, the main contractor cannot recover from its sub-contractors a hypothetical loss it would have suffered had the float not existed. The issues in any claim against the sub-contractor in such circumstances remained simply breach, loss and causation.
CJ-9944
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