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You are here: BAILII >> Databases >> England and Wales High Court (Technology and Construction Court) Decisions >> Multiplex Constructions (UK) Ltd v Honeywell Control Systems Ltd (No. 2) [2007] EWHC 447 (TCC) (06 March 2007) URL: https://www.bailii.org/ew/cases/EWHC/TCC/2007/447.html Cite as: [2007] CILL 2458, [2007] BLR 195, 111 Con LR 78, [2007] BusLR D109, [2007] EWHC 447 (TCC), [2007] Bus LR D109 |
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QUEEN'S BENCH DIVISION
TECHNOLOGY & CONSTRUCTION COURT
Strand, London, WC2A 2LL |
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B e f o r e :
____________________
MULTIPLEX CONSTRUCTIONS (UK) LIMITED |
Claimant |
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- and - |
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HONEYWELL CONTROL SYSTEMS LIMITED (No. 2) |
Defendant |
____________________
6th Floor, 12-14 New Fetter Lane, London EC4A 1AG.
Telephone No: 020 7936 6000. Fax No: 020 7427 0093
DX 410 LDE info@martenwalshcherer.com
MR. MARTIN BOWDERY QC and MR. ROBERT CLAY (instructed by Beale & Co., London) for the Defendant
____________________
Crown Copyright ©
MR. JUSTICE JACKSON :
Part 1. Introduction
Part 2. The facts
".1 The Contractor may issue any reasonable direction in writing to the Sub-Contractor in regard to the Sub-Contract Works (including the ordering of any Variation therein).
.2 Any written instruction of the Employer issued under the Contract affecting the Sub-Contract Works and issued by the Contractor to the Sub-Contractor shall be deemed to be a direction of the Contractor.
.3 No variation required by the Contractor or subsequently sanctioned by him shall vitiate the Sub-Contract.
.4. The Sub-Contractor shall (subject to clause 4.2.4.4) forthwith comply with all directions issued to him by the Contractor in regard to any matter in respect of which the Contractor is expressly empowered by the Sub-Contract to issue instructions ...."
"4.6.1 The Contractor may at any time, in lieu of directing a Variation under Clause 4.2, issue a request for a Variation proposal (a 'Variation Notice Proposal').
.2 In the event that the Contractor issues a Variation Notice Proposal the following procedure shall apply:
.1 The Sub-Contractor shall issue a written response to the Contractor (the 'Sub-Contractor's Variation Response') within 7 days or such other period as may be agreed between the Parties following receipt of any Variation Notice Proposal under clause 4.6.1 stating:.1 the effect (if any) of the Variation on the period or periods for completion of the Sub-Contract Works as set out in the Appendix part 4 together, where necessary, with any proposals for modification to the programme for completion of the Sub-Contract Works..2 whether, in the opinion of the Sub-Contractor, the Variation should be effected and, if the Sub-Contractor is of the opinion that it should not be effected, the reasons for that opinion..3 either the cost of design and construction of the Variation reasonably and necessarily to be incurred by the Sub-Contractor or the saving which will arise as the case may be as a result of the Variation.
.4 the extent, if any, to which the proposed Variation will adversely affect the structure, design life or function of the National Stadium or any of the Sub-Contractor's warranties under the Sub-Contract together with the Sub-Contractor's grounds for such opinion and any proposals for modification to the Numbered Documents.
.5 the effect which, in the reasonable opinion of the Sub-Contractor, the Variation will have on:
.1 the cost of operation and maintenance of the National Stadium.
.2 the cost and timing of asset renewals; and
.3 the cost and availability of insurance; and
.6 the consents, licenses, approvals and/or permits (including any planning approval if applicable) which, in the opinion of the Sub-Contractor, will need to be obtained to give effect to the Variation and the length of time and programme for the completion of the Sub-Contract Works anticipated to be required to obtain such consents, license, approvals and/or permits.
All submissions made by the Sub-Contractor under this clause 4.6.2.1 shall be supported by all necessary documentation and calculations in writing as may be required by the Contractor. The Contractor shall have the right to specify in the Variation Notice Proposal that he considers the Variation to be one that requires urgent implementation. In such case the period within which the Sub-Contractor issues its written response under this clause 4.6.2.1 shall reflect that urgency..2 As soon as practicable after receipt by the Contractor of the Sub-Contractor's Variation Response (but no sooner than the Contractor has received the Employer's response to the Contractor's Change Response under the Contract) the Parties shall seek to agree acting in good faith the basis upon which the Variation will be implemented including the fair and reasonable adjustment to the period or periods for completion of the Sub-Contract Works and the Sub-Contract sum. In the event that the Sub-Contractor's Variation Response is agreed then the Contractor shall issue a notice confirming the variation ("Variation Notice"), and the Sub-Contractor shall give effect thereto. The period or periods for completion of the Sub-Contract Works and the Sub-Contract Sum shall be adjusted as agreed by the Parties provided always that if a variation notice is issued as a result of the issue of a Change under the Contract the Sub-Contractor shall be entitled to no greater adjustment to the Sub-Contract Sum or extension of time to the period or periods for completion than that which, in relation to the Sub-Contract Works, the Contractor receives from the Employer in respect of the equivalent Change under the Contract..3 In the event that no agreement can be reached within such period from receipt of the Sub-Contractor's Variation Response under clause 4.6.2.1 that the Contractor considers to be reasonable in the circumstances, the Contractor may adjust the period or periods for completion of the Sub-Contract Works and the Sub-Contract Sum as he considers appropriate and subject only to clauses 38A and/or 38C and the proviso to clause 4.6.2.2 issue a Variation Notice in respect of such Variation and until any contrary agreement is reached between the Contractor and the Sub-Contractor or any contrary decision is made under clauses 38 and/or 38C the Contractor's estimate shall be treated as though it was the estimate of the Sub-Contractor required by clause 46.2.1 and the Sub-Contractor shall proceed to implement the Variation..4 If the Contractor issues a Variation Notice Proposal no work pursuant to such notice shall be commenced until such time as the Contractor issues a Variation Notice."
"Subject to the proviso to clause 4.6.2.2, Valuations for Variations which have not been agreed pursuant to the procedures under clause 4.6 shall be valued on a fair and reasonable basis consistent with the values included in the build up of the Sub-Contract Sum in the Numbered Documents for work on services of a similar character after making allowance for any significant change in the quality of the work or services carried out or in conditions under which it is to be carried out. If no work or services of a similar character are included in the build up of the Sub-Contract Sum such other basis as is fair and reasonable shall be used and such value shall be added to or deducted from the Sub-Contract Sum."
"11.1.1 The Sub-Contractor shall carry out and complete the Sub-Contract Works in accordance with the details in Appendix Part 4 and reasonably in accordance with the progress of the Works but subject to receipt of the notice to commence work on Site as stated in Appendix Part 4 and the operation of clauses 11 and 38A and/or 38C and any revision to the period or periods for the completion of the Sub-Contract Works in respect of a variation for which a Variation Notice has been issued.
11.1.2 The Contractor may rely on any programmes, milestone dates, durations, sequencings, or the like (time related matters) or any revisions thereto included within this Sub-Contract and/or as may be provided and agreed in writing by the Sub-Contractor from time to time in connection with the Sub-Contract Works (notwithstanding that any such time related matters may not form part of the Sub-Contract) to monitor the progress of the Sub-Contract Works or when planning its own activities or when making arrangements in relation to the Works or when making any returns required under the main Contract and the Sub-Contractor acknowledges that the Contractor could suffer loss and/or expense and/or damage if such time related matters are not complied with and the Sub-Contractor shall notify the contractor when the actual progress of the Sub-Contract Works is inconsistent with any time related matters included within this Sub-Contract or otherwise provided by the Sub-Contractor or agreed as contemplated above along with proposals to procure consistency with such time related matters.
11.1.2 In clause 11, any reference to delay, notice or extension of time includes further delay, further notice or further extension of time.
11.1.3 It shall be a condition precedent to the Sub-Contractor's entitlement to any extension of time under clause 11, that he shall have served all necessary notices on the Contractor by the dates specified and provided all necessary supporting information including but not limited to causation and effect programmes, labour, plant and materials resource schedules and critical path analysis programmes and the like. In the event the Sub-Contractor fails to notify the Contractor by the dates specified and/or fails to provide any necessary supporting information then he shall waive his right, both under the Contract and at common law, in equity and/or to pursuant to statute to any entitlement to an extension of time under this clause 11.
11.2.1 If and whenever it becomes apparent or should have become apparent to an experienced and competent Sub-Contractor that the commencement, progress or completion of the Sub-Contract Works or any part thereof is being or is likely to be delayed, the Sub-Contractor shall forthwith give written notice to the Contractor of the material circumstances including, in so far as the Sub-Contractor is able, the cause or causes of the delay and identify in such notice any event which in his opinion is a Relevant Event.
.2 In respect of each and every Relevant Event, and identified in the notice given in accordance with clause 11.2.1, the Sub-Contractor shall, if practicable in such notice, or otherwise in writing as soon as possible after such notice:
.1 give particulars of the expected effects thereof; and
.2 estimate the extent, if any, of the expected delay in the completion of the Sub-Contract Works beyond the expiry of the period or periods stated in the Appendix Part 4 or beyond the expiry of any extended period or periods previously fixed under clauses 11 or 4.6 which results therefrom not double counting delay caused by another Relevant Event or taking into account delay to the completion of the Sub-Contract Works for which the Sub-Contractor is responsible or bears the risk which in either case is concurrent with delay caused by such Relevant Event; and
.3 the Sub-Contractor shall give further written notices to the Contractor as may be necessary or as the Contractor may reasonably require for keeping up-to-date the particulars and estimate referred to in clause 11.2.2.1 and .2 including any material change in such particulars or estimate.
11.3 If on receipt of any notice, particulars and estimate under clause 11.2 the Contractor properly considers that
.1 any of the causes of the delay is an occurrence of a Relevant Event (provided that any delay which is concurrent and caused by another Relevant Event shall not be double counted and delay which is concurrent and caused by another delay to the completion of the Sub-Contract Works for which the Sub-Contractor is responsible or bears the risk shall not be taken into account); and
.2 the completion of the Sub-Contract Works is likely to be delayed thereby beyond the period or periods stated in the Appendix Part 4 or any revised such period or periods,
then subject to the provisions of clauses and 11.8 and 11.11 and taking into account any adjustment of the period or periods for completion of the Sub-Contract Works determined under clause 4.6 the Contractor shall in writing give an extension of time to the Sub-Contractor by fixing such revised or further revised period or periods for the completion of the Sub-Contract Works as is then fair and reasonable ....
11.7 Subject to clause 11.11, if the expiry of the period when the Sub-Contract Works should have been completed in accordance with clause 11.1 occurs before Practical Completion of the Sub-Contract Works established under clause 14.1 or 14.2, the Contractor may
and
not later than the expiry of 16 weeks from the aforesaid date of Practical Completion of the Sub-Contract Works, the Contractor shall
either
.1 fix such a period or periods for completion of the Sub-Contract Works longer than that previously fixed under clause 11 or 4.6 as the Contractor properly considers to be fair and reasonable having regard to any of the Relevant Events; or.2 fix such a period or periods for completion of the Sub-Contract Works shorter than that previously fixed under clause 11 or 4.6 as the Contractor properly considers to be fair and reasonable having regard to any direction issued requiring as a Variation the omission of any work where such issue is after the last occasion on which the Contractor made a revision of the aforesaid period or periods; or.3 confirm to the Sub-Contractor the periods or periods for the completion of the Sub-Contract Works previously fixed...
11.10 The following are Relevant Events referred in clause 11.3.1
.1 Force Majeure;.2 Not used;
.3 loss or damage occasioned by any one or more of the Specified Perils;
.4 a Variation which is referred for a decision addition under clauses 38A and/or 38C pursuant to clause 4.6;
.5 compliance by the Sub-Contractor with the Contractor's instructions in relation to the following clauses:
.1 under clause 46 ....
.7 delay caused by any act of prevention or default by the Contractor in performing its obligations under the Sub-Contract ....".
"12.1 If the Sub-Contractor fails to complete the Sub-Contract Works or any part thereof within the period or periods for completion stated in the Appendix part 4 or any revised period or periods as provided in clauses 11 or 4.6, the Contractor shall so notify the Sub-Contractor in writing within a reasonable time of the expiry of that period or those periods.
12.2 Without prejudice to any other provision of the Sub-Contract and in particular clause 5.1, on receipt of the notice referred to in clause 12.1, the Sub-Contractor shall indemnify the Contractor for, and shall pay or allow to the Contractor a sum equivalent to, any damage, loss, cost and/or expense suffered or incurred by the Contractor and caused by the failure of the Sub-Contractor as aforesaid."
".5.5 In reaching his decision the Adjudicator shall act impartially, set his own procedure and at his absolute discretion may, take the initiative in ascertaining the facts and the law as he considers necessary in respect of the referral which may include the following:
.1 using his own knowledge and/or experience;.2 opening up, reviewing and revising any direction, opinion, decision, requirement or notice issued given or made under the Sub-Contract as if no such direction, opinion, decision, requirement or notice had been given or made....7.1 The decision of the Adjudicator shall be binding on the Parties until the Dispute is finally by arbitration or by legal proceedings or by an agreement in writing between the Parties made after the decision of the Adjudicator has been given..2 The Parties shall, without prejudice to their other rights under the Contract, comply with the decisions of the Adjudicator; and the Contractor and the Sub-Contractor shall ensure that the decisions of the Adjudicator are given effect."
"When any dispute or difference is to be determined by legal proceedings, then insofar as the Sub-Contract provides for the issue of a certificate or a direction, or the expression of an opinion or the giving of a decision, requirement or notice such provision shall not prevent the Court, in determining the rights and liabilities of the parties hereto, from making any finding necessary to establish whether such certificate was correctly issued or opinion correctly expressed or decision, requirement or notice correctly given on the facts found by the Court; nor shall such provisions prevent the Court establishing what certificate or direction ought to have been issued or what other opinion should have been expressed or what other decision, requirement or notice been given as if no certificate, opinion, decision, requirement or notice had been issued, expressed or given."
"The Contractor may issue instructions in regard to the postponement of any design or construction work to be executed under the provisions of the Sub-Contract."
"7.2 Overall Project Construction Programme.
It is the responsibility of the Contractor to maintain the Overall Project Master Construction Programme and co-ordinate/integrate the input of other team members. The Overall Master Construction Programme will be used as the basis for assessing progress, forecasting the impact of current or impending changes and reporting the overall project status.
7.3 Working Programme
7.3.1 Overall Project Construction Programme will be further developed at a level of detail that shows dates and periods of time for all of the main elements of design, procurement, construction and commissioning activities for the project. This level will subdivide the project into eight zones and phases of the project ....
7.4 Detailed Working Programme.
Further development of the programme at a level that expands upon the detail contained in the Level 2 programme with design, procurement and construction activities further subdivided into trade groups and activities, e.g. Structure - Concrete, structural steel, roof etc. ...."
"14 The subcontractor shall be the lead commissioning subcontractor and will be responsible for the commissioning management of all M&E systems installed throughout the stadium. The subcontractor shall appoint a dedicated commissioning manager as part of the subcontractor's management team. The commissioning manager shall have a dedicated team of engineers as required to manage the commissioning process.
The commissioning management shall include
a) Commissioning programmeb) Sequence co-ordination of commissioning and commissioning logic flow chartsc) Progress reporting against the programmed) Commissioning reports ....
B. Sub-Contract programme
The Sub-Contract Works shall be completed in accordance with MPX issued programme ref CP1-MEP Services Detail.
Whilst the above programme indicates a completion of the Sub-Contract Works by the end of May 05 the Sub-Contractor has included for all cost implications should the completion of the Sub-Contract Works not be achieved until the end of September 2005.
The Sub-Contractor has included to be flexible on the timing, durations and sequences to enable Multiplex to alter this programme to suit the specific construction requirements. The Sub-Contractor is referred to the Conditions of the Sub-Contract.
The Sub-Contractor is aware that the Sub-Contract Works will be undertaken simultaneously and coordinated with other trades. The Sub-Contractor can view the master programme to establish full knowledge of the other activities that the Sub-Contract Works are to be sequenced with. The Sub-Contractor has included for any costs associated with sequencing and coordinating their works with other trades."
Programme CP1-MEP Services Details, which is referred to in that passage, showed a completion date of 31st May 2005.
Part 3. The present proceedings
"(1) On a true construction of the Subcontract between MPX and HCS dated 27th May 2004, Clause 11 provided a mechanism for extending the period for completion of the Subcontract Works in respect of any delay to completion caused by an instruction issued under Clause 4.2 of the Subcontract.
(2) A direction issued by MPX to HCS under Clause 4.2 of the Sub-Contract would not render time at large so as to relief HCS of its obligation to complete the Subcontracts Works within the period for completion set out in the Appendix Part 4 as adjusted by Clauses 4.6 and/or 11 and/or 38A and/or 38C.
(3) The Subcontract mechanism for extending the period for completion of the Subcontract Works remains in full force so that a specific period for completion of the Subcontract Works remains ascertainable."
"(1) On the true construction of the Sub-Contract there is no provision for a direction for a variation under Clause 4.2 of the Conditions in clause 11 and it cannot be a relevant event under clause 11, and put time at large.
(2) Alternatively, on the true construction of the Sub-Contract, a decision to issue a direction for a variation under Clause 4.2 of the Conditions, and not to invoke the mechanism of clause 4.6 which provides for extension of time, is an option open to the Contractor which bypasses the extension of time mechanism and puts time at large.
(3) The mechanism for extending time under clause 11 has broken down, and time is at large.
(4) Alternatively, even if the mechanism for extending time under clause 11 has not broken down irretrievably, Multiplex has failed to operate it hitherto, the original time for completion does not apply, and no new time will bind Honeywell until such time as Multiplex operates clause 11.3 of the Conditions.
(5) Alternatively, on the true construction of the Sub-Contract any failure to comply with the condition precedent under 11.1.3 after a direction under 4.2 causing delay, puts time at large.
(6) Alternatively, the main contract mechanism for extending time has been superseded, depriving Honeywell of rights and benefits under the said mechanism to extensions of time, putting time at large."
Part 4. The Construction Point
"On looking into the facts of the case we think no deduction ought to be allowed to the defendants. It is clear from the terms of the agreement that the plaintiffs undertake that they will complete the work in a given four months and a half and the particular time is extremely material because they probably would not have entered into the contract unless they had had those four months and a half within which they could work a greater number of hours a day. Then it appears that they were disabled from by the act of the defendants from the performance of that contract. There are clear authorities that if the party be prevented by the refusal of the other contracting party from completing the contract within the time limited he is not liable in law for the default ... It is clear, therefore, that the plaintiffs were excused from performing the agreement contained in the original contract and there is nothing to show that they entered into a new contract by which to perform the work in four months and a half ending at a later period. The plaintiffs were therefore left at large. Consequently they are not to forfeit anything for the delay."
"It was, no doubt, part of the original Contract that the building owner should have a right to call upon the builder to do that extra work, and if he did give an order for it, the builder could not refuse to do it. The principle is laid down in Comyns' Digest, Condition L(6.), that, where one party to a contract is prevented from performing it by the act of the other, he is not liable in law for that default; and, accordingly, a well recognised rule has been established in cases of this kind, beginning with Holme v Guppy, to the effect that, if the building owner has ordered extra work beyond that specified by the original contract which has necessarily the time requisite for finishing the work, he is thereby disentitled to claim the penalties for non-completion provided by the contract. The reason for that rule is that otherwise a most unreasonable burden would be imposed upon the Contractor. Then this further complication arose. Contracts were entered into by which the builder agreed to do any extra work which the building owner or his architect might order. It was urged in such cases, as, for instance, in Westwood v. The Secretary of State for India, that the fact that the builder had contracted to do any extra work that might be ordered prevented the application of the rule which I have mentioned. But it was held that that was not so."
Lopes and Chitty LJJ delivered concurring judgments to the same effect.
"In my judgment, however, the plaintiffs are not entitled to anything at all under this head, because they were not liable to pay any liquidated damages for delay to the corporation. A clause giving the employer liquidated damages at so much a week or month which elapses between the date fixed for completion and the actual date of completion is usually coupled, as in the present case, with an extension of time clause. The liquidated damages clause contemplates a failure to complete on time due to the fault of the contractor. It is inserted by the employer for his own protection; for it enables him to recover a fixed sum as compensation for delay instead of facing the difficulty and expense of proving the actual damage which the delay may have caused him. If the failure to complete on time is due to the fault of both the employer and the contractor, in my view, the clause does not bite. I cannot see how, in the ordinary course, the employer can insist on compliance with a condition if it is partly his own fault that it cannot be fulfilled: Wells v Army & Navy Co-operative Society Limited; Amalgamated Building Contractors v Waltham Urban District Council; and Holme v Guppy. I consider that unless the contract expresses a contrary intention, the employer, in the circumstances postulated, is left to his ordinary remedy; that is to say, to recover such damages as he can prove flow from the contractor's breach. No doubt if the extension of time clause provided for a postponement of the completion date on account of delay caused by some breach or fault on the part of the employer, the position would be different. This would mean that the parties had intended that the employer could recover liquidated damages notwithstanding that he was partly to blame for the failure to achieve the completion date. In such a case the architect would extend the date for completion, and the contractor would then be liable to pay liquidated damages for delay as from the extended completion date.
The liquidated damages and extension of time clauses in printed forms of contract must be construed strictly contra proferentem. If the employer wishes to recover liquidated damages for failure by the contractors to complete on time in spite of the fact that some of the delay is due to the employers' own fault or breach of contract, then the extension of time clause should provide, expressly or by necessary inference, for an extension on account of such fault or breach on the part of the employer. I am unable to spell any such provision out of clause 23 of the contract in the present case."
Edmund Davies and Phillimore LJJ expressed similar views in their concurring judgments.
"…. It is well settled that in building contracts - and in other contracts too - when there is a stipulation for work to be done in a limited time, if one party by his conduct - it may be quite legitimate conduct, such as ordering extra work - renders it impossible or impracticable for the other party to do his work within the stipulated time, then the one whose conduct caused the trouble can no longer insist upon strict adherence to the time stated. He cannot claim any penalties or liquidated damages for non-completion in that time."
(i) Actions by the employer which are perfectly legitimate under a construction contract may still be characterised as prevention, if those actions cause delay beyond the contractual completion date.
(ii) Acts of prevention by an employer do not set time at large, if the contract provides for extension of time in respect of those events.
(iii) In so far as the extension of time clause is ambiguous, it should be construed in favour of the contractor.
"Where two constructions of an instrument are equally plausible, upon one of which the instrument is valid and upon the other of which it is invalid, the court should lean towards that construction which validates the instrument."
Part 5. The Operational Point
"44. In breach of the terms as to programming and the implied terms of the Sub-Contract:
(1) Multiplex failed to provide a full electronic version of FO 15, in a form which could be interrogated and manipulated electronically.(2) Multiplex has failed to provide Honeywell with an updated version of FO 15, and/or(3) Multiplex has failed to provide Honeywell with any or any adequate replacement for FO 15;(4) In further breach of the terms as to programming and the implied terms of cooperation in the Sub-Contract, Multiplex has failed to provide Honeywell with detailed programmes which use the same or comparable activities as FO 15 and are linked to FO 15 so that they can be used in conjunction with FO 15.
Particulars of programming breaches: the use made on site of the overall programmes
45. The overall programmes CP-1, PTC-1, CB7E, FO 15 and DC 10 issued by Multiplex were not used by Multiplex to programme Honeywell's works on site.
46. On site Multiplex used 3 week and 3 week look ahead programmes. The said 3 month and 3 week programmes were not in the same format as the overall programmes, and they were not linked to the overall programmes. Further, the activities in the said programmes are not comparable to the activities in the overall programmes.
47. The most important preceding trades which must have reached a certain stage of completion before Honeywell can begin its works in any given area are as follows:
(1) the structure(2) the walls(3) primary containment for the first and second fix.(4) plastering for the final fix(5) ceilings for the final fix(6) electrical power for the final fix, and for commissioning(7) completion of all other mechanical and electrical works for commissioning and commissioning management.
48. Where the overall programmes identified the said dependencies, Honeywell could in theory plan its works by reference to the overall programmes. However, in practice Multiplex's project managers did not use or follow the overall programmes. Honeywell was informed of when work was to be released by reference to the 3 month and 3 week look ahead programmes, rather than by reference to the overall programmes. Therefore dates and sequences in the overall programmes were not the dates and sequences which would in fact be followed in practice.
49. In the premises, although Honeywell has used some of the overall programmes to report progress, the said programmes have not given Honeywell any guidance for planning the work, or for identifying the critical path, or for identifying the future sequence.
50. In July 2005 Multiplex ceased to issue 3 month look ahead programmes and from the on the release of work areas to Honeywell proceeded solely by reference to 3 week look ahead programmes and by weekly meetings.
Particulars: Programming position in 2006
51. From January 2006 FO 15 and DC 10 were obsolete and irrelevant to future planning and programming, although Honeywell continued to refer to FO 15 in some of its reports and correspondence for reporting of progress. From January 2006 there has been no overall programme for the works.
52. From January 2006 the information about release of work areas and other dependencies which has been given to Honeywell has been short term, relating to the next or few weeks and has been given informally rather than by the issue of formal programmes.
53. A period of one week or 3 weeks into the future was inadequate for identifying the critical path, planing the work and estimating the impact of any delays for the purposes of any extension of time claim:
(1) As at January 2006 installation was not complete, and has not yet been completed to date.(2) A realistic period for commissioning after the completion of installation of all mechanical services (including those not constructed or installed by Honeywell) is approximately 6 months.(3) It was necessary for the overall programme to identify critical dependencies and sequences over the months leading up to completion of installation, and thereafter for six months during commissioning.
Thus from January 2006 to date an overall programme for identifying the critical path, planning the work, and estimating the impact of any delays needed to look ahead for a year rather than a few weeks. No such programme was issued."
"In the absence of this information Honeywell notified Multiplex of the delay event and would later try to determine the combined and cumulative effect of each delay event upon the programme at such time this would become possible."
"This type of change would delay Honeywell in that resources would have to be moved from one area to another without proper planning. As such and without changes to the programme in place at the time Honeywell was unable to ascertain the precise extent and duration of delay incurred."
Part 6. The Gaymark Point
"The Contractor shall only be entitled to an extension of time for Practical Completion where ... (b)(i) the contractor has complied strictly with the provisions of sub-clause SC19.1 and in particular has given the notices required by sub-clause SC19.1 strictly in the manner and within the times stipulated by that sub-clause."
(1) That the contractor was delayed in completing the work, including a delay of 77 days by causes for which the employer was responsible, but the contractor's application for an extension of time was barred because of its failure strictly to comply with the notification requirements for the extension of time clause.
(2) That the 77 days' delay constituted acts of prevention by the employer with the result that there was no date for practical completion and the contractor was then obliged to complete the work within a reasonable time (which the Arbitrator found that it in fact did) with the consequence being that Gaymark was prevented from recovering liquidated damages for delay.
"69. Acceptance of Gaymark's submissions would result in an entirely unmeritorious award of liquidated damages for delays of its own making (and this in addition to the avoidance of Concrete Constructions' delay costs because of that company's failure to comply with the notice provisions of SC19). The effect of re-drafting GC35 of the contract (to delete GC35.4 and substitute SC19) has been to remove the power of the superintendent to grant of allow extensions of time. SC19 makes provision for an extension of time for delays for which Gaymark directly or indirectly is responsible but the right to such an extension is dependent on strict compliance with SC19 (and in particular the notice provisions of SC19.1). In the absence of such strict compliance (and where Concrete Constructions has been actually delayed by an act, omission or breach for which Gaymark is responsible) there is no provision for an extension of time because GC35.4 which contains a provision which would allow for this (and is expressly referred to in GC35.2 and GC35.5) has been deleted.
70. In Peak Construction (Liverpool) Limited v McKinney Foundations Limited [1970] 1 BLR 111, Salmon LJ held:
'The liquidated damages and extension of time clauses and printed forms contract must be construed strictly contra preferentum. If the employer wishes to recover liquidated damages for failure by the contractors to complete on time in spite of the fact that some of the delay is due to the employer's own fault or breach of contract, then the extension of time clause should provide, expressly or by necessary inference, for an extension on account of such a fault or breach on the part of the employer'.
71. In the circumstances of the present case, I consider that this principle presents a formidable barrier to Gaymark's claim for liquidated damages based on delays of its own making. I agree with the arbitrator that the contract between the parties fails to provide for a situation where Gaymark caused actual delays to Concrete Construction's achieving practical completion by the due date coupled with a failure by Concrete Constructions to comply with the notice provisions of SC19.1. In such circumstances, I do not consider that there was any 'manifest error of law on the face of the award' or any 'strong evidence' of any error of law in the arbitrator holding that the 'prevention principle' barred Gaymark's claim to liquidated damages."
"If the Builder, having a right to claim an extension of time fails to do so, it cannot claim that the act of prevention which would have entitled it to an extension of time for Practical Completion resulted in its inability to complete by that time. A party to a contract cannot rely upon preventing the contract of the other party where it failed to exercise a contractual right which would have negated the effect of that preventing conduct."
"I accept that, in the absence of the Superintendent's power to extend time, even if a claim had not been made within time, Abigroup would be precluded from the benefit of an extension of time and liable for liquidated damages, even if delay had been caused by variations required by Peninsula and thus within the so-called 'prevention principle'. I think this does follow from the two Turner cases and the article by Mr. Wallace referred to by Mr. Rudge."
Part 7. The Effect of the Settlement Agreement
"The parties involved in the Wembley Stadium project today announce that they have agreed a comprehensive settlement of all outstanding issues. The agreement follows successful talks chaired by Lord Carter between the FA, Wembley National Stadium Limited (WNSL) and the constructors Multiplex. This agreement will avoid a lengthy and expensive legal dispute and all parties are committed to working together to ensure that the stadium opens for business as early as possible in 2007. Multiplex's chief executive, Andrew Roberts, said:
'We are very pleased to have reached agreement with WNSL and the FA and to put our past differences behind us and put all our joint efforts into completing the Wembley Stadium at the earliest opportunity'.
The FA chief executive, Brian Barwick, said this:
'The agreement secures the process of getting the new Wembley Stadium up, running and open to the public. We look forward to staging major events at the stadium next year and consider this agreement with Multiplex to represent the beginning of the end of the construction phase. Everyone's target is now to complete what will be the finest stadium in the world.'
WNSL chief executive, Michael Cunar, said:
'This is very welcome news for everyone involved with the stadium. This project was founded on the shared desire of WNSL and Multiplex to create a truly special stadium and it is very appropriate that we should enter the final stages of the project working together to get the stadium operational. Multiplex played and intrinsic part in getting this stadium project up off the ground and I am delighted to be working together to achieve our original vision.'
Multiplex is pleased to announce that it has resolved all variations and reached a comprehensive settlement of all disputes with its client at the Wembley Stadium project WNSL. The agreement is conditional on a consent to be obtained by WNSL from its financiers. Multiplex and WNSL have agreed a streamlined process whereby the works and activities that are the responsibility of WNSL will be completed in parallel with other works. This should ensure that the stadium is able to complete its test events earlier than envisaged in previous progress updates."
"At the date of the Completion Contract Honeywell was entitled to an extension of time in respect of variations to the Sub-Contract Works which were changes to the Main Contract Works. By the terms of clause 4.6.2 of the Sub-Contract Conditions any extension of time is limited to the extension granted under the main contract. By reason of the Completion Contract no such extension will ever be given, so the said variations cannot be accommodated by any extension under clause 4.6 of the Sub-Contract, or by reason of relevant event 11.10.4 and time is at large."
Part 8. Conclusion
MR. JUSTICE JACKSON:
(1) whether or not his judgment or order is final;
(2) whether an appeal lies from the judgment or order and, if so, to which court;
(3) whether the court gives permission to appeal; and
(4) if not, the appropriate appeal court to which any further application for permission may be made.