TECBAR Review

Issue Spring 2011

The Newsletter of the Technology and Construction Bar Association

in association with

From the Chairman On a more somber note I was sad to hear of the passing of
His Honour Esyr Lewis QC, a former Official Referee. The next
I am delighted to announce that Informa Law & Finance has
edition of the Review will contain an obituary. A Memorial
agreed to publish and distribute the TECBAR Review. TECBAR
Service, to which all are welcome, will be held in Gray’s Inn
looks forward to this relationship and the opportunities it offers.
Chapel at 5.00pm on Wednesday 15 June. A reception will fol-
In addition to publishing the Review, Informa Law & Finance will
low in the Large Pension Room.
provide members with access to a limited number of Informa
Law CPD Podcasts each year. The next edition of the Review will
explain how TECBAR and SCL members will be able to access Chantal-Aimée Doerries QC, Chairman
these. I would also like to thank Sweet and Maxwell, the former
publisher of the TECBAR Review, for many years of support.
From the Editor
On 11 February many judges and users of the TCC gathered In this first issue of the TECBAR Review to be published by our
in the Lord Chief Justice’s Court for the valedictory of HH new partners at Informa, Mr Justice Ramsey considers claims
Judge John Toulmin C.M.G. Q.C. This was very well attended. for delay and disruption and the decision in City Inn, a case
The Lord Chief noted “it is a lovely turn-out, to pay a tribute that will unfortunately (from the perspective of construction
to a wonderful Judge and actually a lovely man … This is the lawyers, if not the parties) not now come before the Supreme
only court that would have been big enough to find a place Court, following its compromise. Steven Walker’s article
for all the many people who want to join in the tribute that addresses Part 8 claims in the context of adjudication, a topic
is going to be paid to John Toulmin … It is not merely because of considerable importance given the amount of adjudica-
it is John, but it is, in a strange way, symbolic of something tion-related actions coming before the TCC.
that has been happening over the years which those of us
who are older than some of you will remember as the old Both articles are based upon talks given at the TECBAR
Official Referees’ corridor tucked away in an out of the way Annual Conference. Correspondence on the articles as well
bit of the building unknown, unheard of, where very strange as contributions to the next edition of the Review would, as
people used to work! I did a couple of cases there myself, so always, be very welcome indeed.
I can speak with confidence. It shows a move from there by
what is now the Technology and Construction Court right into Mark Chennells, Editor
the heart of the administration of civil justice. I think, there-
fore, it is salutary to just bear that in mind when we consider
all the many wonderful things that can be said about John.”
List of Contents
We had a packed out TECBAR Annual Conference on 29
Claims for Delay & Disruption: the decision in City Inn 2
January 2011. We also held, for the first time in a number of
years, our adjudication training course in May. Thanks go to
Part 8 Claims and adjudication business 8
Lynne McCafferty for organising two such good events.

Spring 2011
TECBAR
Claims for Delay & Disruption: the decision in City Inn
Introduction
1. One of the risks in contracting is delay and disruption on
projects and also the way in which this is dealt with under
standard forms of contract. Claims based on either delay or
disruption are notoriously complex and difficult to establish
both as to liability and quantum. The mechanisms adopted
by many standard forms of contract provide for the con-
tractor to give notices and provide particulars, and for the
architect or engineer to carry out an assessment and grant
an extension of time and certify a sum to be paid. Those
mechanisms often lead to disputes and, when they do, an
arbitrator or the court is faced with the task of carrying out
an assessment based on the factual and expert evidence
produced in an adversarial contest.
2. Over the years arbitrators and the courts have attempt-
ed to analyse the basis upon which such claims are assessed
but this has normally focused on the facts and arguments
in those particular cases and has not led to a consistent or
well-established set of rules to be applied.
3. In this paper, I shall consider the extent to which any
helpful guidance can be derived from case law including the
recent Scottish appeal decision in City Inn v Shepherd Con-
struction [2010] CSIH 68, [2010] BLR 473, where the possible
appeal to the Supreme Court has now been settled.
Claims under the Contract or for breach
4. Where contracts contain express provisions for extension
of time and for payment of loss caused by delay and disrup-
tion the starting point must of course be the relevant terms
of the contract. Where those express terms do not contain a
sufficient description of the way in which extensions of time
and loss are to be assessed and where the claims for delay
and disruption are based on a breach of contract, resort has
to be had to general principles of law applicable to breach,
causation and assessment of loss.
5. Examples of contractual provisions which deal with
these matters can be found in the standard forms. It is
convenient to consider the UK JCT standard form of contract
considered in City Inn:
(1) Clause 25.2.1.1 provides the starting point for the proce-
dure to grant an extension of time as follows:
“If and whenever it becomes reasonably apparent that
the progress of the Works is being or is likely to be de-
layed the Contractor shall forthwith give written notice to
the Architect of the material circumstances including the
cause or causes of the delay and identify in such notice
any event which in his opinion is a Relevant Event.”
(2) Clause 25.3.1 then deals with the role of the architect
and provides:
“If, in the opinion of the Architect, upon receipt of any
2 Informa Law & Finance
Issue Spring 2011
notice, particulars and estimate under clauses 25.2.1.1
and 25.2.2
1.1 any of the events which are stated by the Contrac-
tor to be the cause of the delay is a Relevant Event, and
1.2 the completion of the Works is likely to be delayed
thereby beyond the Completion Date the Architect shall
in writing to the Contractor give an extension of time
by fixing such later date as the Completion Date as he
then estimates to be fair and reasonable.”
(3) In relation to loss and expense, Clause 26 makes provi-
sion for loss and expense caused to the contractor by matters
materially affecting regular progress of the works. Clause 26.1
is in the following terms:
“26.1 If the Contractor makes written application to the
Architect stating that he has incurred or is likely to incur
direct loss and/or expense in the execution of this Con-
tract for which he would not be reimbursed by a payment
under any other provision in this Contract ... because the
regular progress of the Works or of any part thereof has
been or is likely to be materially affected by any one or
more of the matters referred to in clause 26.2; and if and
as soon as the Architect is of the opinion .... that the regu-
lar progress of the Works or of any part thereof has been
or is likely to be so materially affected as set out in the
application of the Contractor, then the Architect from time
to time thereafter shall ascertain, .... the amount of such
loss and/or expense which has been or is being incurred
by the Contractor; provided always that...”
6. It can be seen from the emphasised parts of those clauses
that they leave much to the discretion of the architect (as do
other forms of contract to the discretion of the engineer or
the project manager) and do not assist in defining the way
in which the assessment of extension of time or loss and
expense is to be made.
7. When there is a gap in the contractual mechanism then
the courts will look to general principles of law in an attempt
to define some rules to fill that gap and in doing so the
tendency is for the principles applicable to claims under the
contract to be elided with claims for breach of contract.
8. The principles of the common law which often apply in
such circumstances are that:
(1) The breach of contract must be proved.
(2) A causative link between the breach and the loss must
be established.
(3) Damages will be assessed on the basis, generally, that
the party is put in the position that they would have
been in had the contract been performed.
 Issue Spring 2011
Background to extension of time claims
9. It is worth considering two matters by way of background.
First, there is a link between extension of time and the recov-
ery of damages, often liquidated and ascertained damages
for delay. The purpose of the extension of time clause is
therefore to relieve the contractor from liquidated damages
and also to provide the contractor with more time to carry
out the work.
10. The common law, particularly in England and Wales
has generally approached the question of extensions of time
from the impact of liquidated damages. The underlying pre-
vention principle, as set out in Holme v Guppy (1838) 3 M &
W 387 is 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 per-
forming the agreement contained in the original contract...
The plaintiffs were therefore left at large; and consequently
they are not to forfeit anything for the delay.” This principle
was developed in Dodd v Churton [1897] 1 QB 562 .
11. In Peak Construction (Liverpool) Ltd v McKinney Foun-
dations Ltd [1970] 1 BLR 111, Salmon LJ said this: “If the fail-
ure to complete on time is due to the fault of both the em-
ployer 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 and Navy
Co-operative Society Ltd (1902) 86 LTR 764; Amalgamated
Building Contractors Ltd v Waltham Holy Cross Urban District
Council [1952] 2 All ER 452 ; and Holme v Guppy 3 M & W 387.
I consider that unless the contract expresses a contrary in-
tention, 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 post-
ponement of the completion date on account of delay caused
by some breach or fault on the part of the employer, the posi-
tion would be different.”
12. Secondly, there is a timing aspect to extension of time
clauses. Most contracts expect extensions of time to be given
soon after the relevant delaying event has occurred with a
review of the situation at a later date. That gives rise to
problems of timing. Generally architects and engineers have
been reluctant to give large prospective extensions of time
at any early stage.
Complexity of claims for delay and disruption
13. Those contractual provisions and the principles of law
to be applied can be stated and are tolerably easy to apply
where there is one event which causes an obvious effect
which, in turn, can be easily assessed. The real problem is
that claims for delay and disruption are based on a num-
ber of events, with difficulty in establishing which event has
caused what and a global loss which cannot be traced to any
particular cause. In the course of establishing the claim there
e Informa Law & Finance 3
TECBAR
are difficulties when a claiming party fails to establish li-
ability for particular events, particular effects alleged to have
been caused by events or elements of loss which the party
attributes to certain causes. This is compounded by posi-
tive assertions that there were other operative events which
caused effects and loss.
14. That complexity is frequently defined as being concur-
rent events or concurrent causes or concurrent delay or dis-
ruption. The use of the word “concurrent” particularly in the
context of delay has become a useful term to conceal rather
than to deal with the problem.
Concurrent delay
15. The problem of defining concurrent delay was dealt with
in the opinion of Lord Osborne in City Inn at [49],
“One of the problems in using such expressions as ‘con-
current delay’ or ‘concurrent delaying events’ is that they
may refer to a number of different situations. Confining
attention for a moment to concurrent delaying events,
which may be taken to mean relevant events and other
events, or causes of delay, which are not relevant events,
there would seem to be several possibilities. Such events
may be described as being concurrent if they occur in time
in a way in which they have common features. One might
describe events as concurrent on a strict approach only if
they were contemporaneous or co-extensive, in the sense
that they shared a starting point and an end point in time.
Alternatively, events might be said to be concurrent only
in the sense that for some part of their duration they
overlapped in time. Yet again, events might be said to be
concurrent if they possessed a common starting point or
a common end point. It might also be possible to describe
events as concurrent in the broad sense that they both
possessed a causative influence upon some subsequent
event, such as the completion of works, even though they
did not overlap in time. In other words, they might also
be said to be contributory to or co-operative in bringing
about some subsequent event. It is in this sense that the
use of the term concurrent is perhaps most likely to be of
relevance in the application of clause 25.3 of the Standard
Form conditions ... It appears to me that one of the prob-
lems in the present case is that language such as that un-
der consideration here has been used in different senses
at different times. It therefore becomes important in the
interests of clarity, to try to disentangle this confusion.”
16. In reality the first question is whether there is true concur-
rency. In City Inn Lord Drummond Young dealt with the ques-
tion as follows: “Where there is true concurrency between a
relevant event and a contractor default, in the sense that both
existed simultaneously, regardless of which started first…”.
17. In many cases the definition of concurrency falls short
of true concurrency where no cause is dominant and where
there are two or more dominant causes of a delay. Equally
when fully analysed the facts often do not establish true
concurrency.
TECBAR
18. If there is concurrency then in tort because there are
competing causes, a claimant can recover in full under Eng-
lish law if he establishes that the cause for which the de-
fendant is liable caused or materially contributed to his loss.
Any cause for which the claimant is liable will be taken into
account under the statutory provisions for contributory negli-
gence. Prior to the Law Reform (Contributory Negligence) Act
1945 which allowed contribution, the position was that the
fault of the other party acted as a complete defence: But-
terfield v Forrester (1809) 11 East 60 per Lord Ellenborough.
19. In contract, the general approach to causation is to look
for the effective, dominant cause. If there is no single domi-
nant cause the position is unclear. The authors of Keating
on Construction Contracts (8th Edition) suggest three possible
approaches: The approach of Devlin J in Heskell v Continental
Express Ltd [1950] 1 All ER 1033 at 1048 for the loss to be
recoverable if one of the causes is a breach; the approach
of being unable to show a dominant cause and therefore not
recovering and the approach in tort of allowing recovery if
the cause has caused or materially contributed to the loss.
Previous English decisions on principles of
extension of time
20. The questions which have to be answered are:
(1) Has delay been caused by a Relevant Event?
(2) Is completion of the Works likely to be delayed by the
Relevant Event beyond the Completion Date?
(3) What is a fair and reasonable extension of time?
21. The first two questions raise issues of causation on which
the decisions appear to have concentrated, rather than on
the third question of what is a fair and reasonable extension
of time. In City Inn Lord Carloway took an interesting view of
the way in which the issues should be considered when he
said at [103] that:
“[I]t is important to note that the contract is not expressed
in a manner whereby the contractor is entitled to an ex-
tension of time in the event of a Relevant Event occurring.
Were that to be the case, all the esoteric nuances of a
lawyer’s approach to causation, including issues such as
‘dominant’ or ‘operative’ causes etc, might have a more
prominent part to play. Rather clause 25.3.1 provides that
it is in the power of the architect to form an opinion on
whether a matter complained of is a ‘Relevant Event’ and
whether ‘the completion of the Works is likely to be de-
layed thereby beyond the Completion Date’. If he does so
determine, then he will fix a later date ‘as he then esti-
mates to be fair and reasonable’. On one view, the matter
ought to be approached as an architect would assess the
situation at the time and not by a judge using his percep-
tion of legal causation.”
22. At [110] he said:
“But the exercise remains one of looking at the Relevant
Event and the effect it would have had on the original
(or already altered) Completion Date. If a Relevant Event
4 Informa Law & Finance
Issue Spring 2011
occurs (no matter when), the fact that the Works would
have been delayed, in any event, because of a contractor
default remains irrelevant.”
23. The main problem is the question of overlap between de-
lay caused by matters for which the contractor is responsible
(“culpable delay”) and matters which may give rise to an
extension of time (“relevant events”). It is convenient to look
at some of the cases which have dealt with this problem.
In Balfour Beatty Building Limited v Chestermount Properties
Limited (1993) 62 BLR 1 Coleman J dealt with the issue of
whether the extension of time had to be based on the net or
the gross period of delay. At 34 he said:
“In each case it is for the architect exercising his powers
under clause 25.3.3 to decide whether an adjustment of
the completion date is fair and reasonable having regard
to the incidence of relevant events.
...
Fundamental to this exercise is an assessment of whether
the relevant event occurring during a period of culpable
delay has caused delay to the completion of the works
and, if so, how much delay. There may well be circum-
stances where a relevant event has an impact on the prog-
ress of the works during a period of culpable delay but
where that event would have been wholly avoided had the
contractor completed the works by the previously-fixed
completion date. For example, a storm which floods the
site during a period of culpable delay and interrupts the
progress of the works would have been avoided altogether
if the contractor had not overrun the completion date.
In such a case it is hard to see that it would be fair and
reasonable to postpone the completion date to extend
the contractor’s time. Indeed, where the relevant event
would not be an act of prevention, it is hard to envisage
any extension of time being fair and reasonable unless
the contractor was able to establish that, even if he had
not been in breach of overshooting the completion date,
the particular relevant event would still have delayed the
progress of the works at an earlier date.”
24. In Henry Boot Construction (UK) Limited v Malmaison Ho-
tel (Manchester) Limited (1999) 70 ConLR 32 at [13] Dyson J
noted with approval an agreement between the parties that:
“... if there are two concurrent causes of delay, one of
which is a relevant event, and the other is not, then the
contractor is entitled to an extension of time for the peri-
od of delay caused by the relevant event notwithstanding
the concurrent effect of the other event.”
25. The question was whether, in determining whether a rel-
evant event is likely to cause delay to the works beyond the
completion date, the architect was permitted by clause 25 to
consider the effect of other events. At [15] Dyson J said that
the architect could consider the effect of other events and
added:
“It seems to me that it is a question of fact in any given
case whether a relevant event has caused or is likely to
 Issue Spring 2011
cause delay to the works beyond the completion date in
the sense described by Coleman J in the Balfour Beatty
case.”
26. In Royal Brompton Hospital NHS Trust v Hammond and
others (No 7) (2001) 76 ConLR 148 Judge Seymour QC con-
sidered the circumstances in which it was proper to grant
an extension of time under clause 25 of the Standard Form
conditions. He was referred to Balfour Beatty Building Ltd
v Chestermount Properties Ltd and Henry Boot Construction
(UK) Ltd v Malmaison Hotel (Manchester) Ltd in relation to
cases where relevant and non-relevant events operate con-
currently and said at [31]:
“However, it is, I think, necessary to be clear what one
means by events operating concurrently. It does not
mean, in my judgment, a situation in which, work al-
ready being delayed, let it be supposed, because the
contractor has had difficulty in obtaining sufficient la-
bour, an event occurs which is a relevant event and
which, had the contractor not been delayed, would have
caused him to be delayed, but which in fact by reason of
the existing delay, made no difference. In such a situa-
tion although there is a relevant event, ‘the completion
of the Works is [not] likely to be delayed thereby beyond
the Completion Date’.
The relevant event simply has no effect upon the com-
pletion date. This situation obviously needs to be distin-
guished from a situation in which, as it were, the works
are proceeding in a regular fashion and on programme,
when two things happen, either of which, had it happened
on its own, would have caused delay, and one is a rel-
evant event, while the other is not. In such circumstances
there is a real concurrency of causes of the delay. It was
circumstances such as these that Dyson J was concerned
with in the passage from his judgment in Henry Boot Con-
struction (UK) Ltd v Malmaison Hotel (Manchester) Ltd
(1999) 70 ConLR 32 at 37 at [13].”
27. The Court of Appeal refused leave to appeal against the
decision of Judge Seymour. Sir Anthony Evans did not enter
upon a consideration of the proper approach as regards cau-
sation required by clause 25 other than to say at [11] that no
criticism was made of the judge’s approach and that both
parties accepted that his analysis of the legal position was
entirely correct.
28. The overall conclusion of those decisions is that the
Malmaison principle applies, that is, if there are two concur-
rent causes of delay, one of which is a relevant event, and the
other is not, then the contractor is entitled to an extension
of time for the period of delay caused by the relevant event
notwithstanding the concurrent effect of the other event.
The City Inn case
29. The facts of the case may be summarised as follows:
(1) Date for possession: 26 January 1998;
(2) Completion Date: 25 January 1999;
e Informa Law & Finance 5
TECBAR
(3) Liquidated and ascertained damages: £30,000 per week;
(4) The original Architect was dismissed in December 1998
and new architects appointed.
(5) Practical completion took place on 29 March 1999 but
work continued until April 1999.
(6) In June 1999 the Architect granted a four-week exten-
sion of time to 22 February 1999. This meant that Liqui-
dated damages of £150,000 for the five-week period to
29 March 1999 could be deducted and the contractor was
entitled to four weeks of loss and expense.
(7) In an adjudication, the Adjudicator awarded a further
extension of five weeks so that the employer had to
repay £150,000 and pay five weeks additional loss and
expense.
(8) In the court proceedings the employer contended that
the contractor was entitled to no extension of time be-
yond 25 January 1999: any delays were concurrent with
contractor’s delays caused to the lifts and stair balus-
trades. The contractor sought an extension of time of 11
weeks up to 12 April 1999. This was based on three-and-
a-half weeks caused by the late issue of an architect’s in-
struction varying the gas membrane in the substructure;
5 weeks (concurrent with the three-and-a-half weeks) for
a delay caused by a late architect’s instruction varying
the roof cladding and six weeks caused by late issue of
instructions following the dismissal of the original archi-
tects. The contractor also claimed loss and expense for
11 weeks.
(9) At first instance Lord Drummond Young held that there
were causes of delay which were relevant events and
also delay to the lift installation and the construction of
the stair balustrades which were the fault of the contrac-
tor. Both caused delay to 12 April. He decided to appor-
tion the delay so that he granted an extension of time
of 9 weeks to 29 March 1999. The employer was there-
fore not entitled to liquidated damages. The contractor
awarded loss and expense for nine weeks. This was all
as the Adjudicator had decided.
30. The main issue of general interest considered on appeal
was whether, in circumstances of concurrency, it was appro-
priate for there to be an apportionment.
Apportionment
31. Apportionment has not generally found favour except
where introduced by statute. In the Law Commission working
paper on contributory negligence as a defence in contract,
produced in 1990, they proceeded on the basis that, broadly
speaking, the law did not currently permit apportionment
where the defendant is liable only in contract. The Law Com-
mission’s provisional conclusion was that where the loss or
damage suffered by the claimant results partly from his own
conduct and partly from the defendant’s breach of contract,
TECBAR
it is correct in principle for the damages to be apportioned.
This has not been implemented.
32. There have been cases where there has been an at-
tempt to apportion liability. In the landlord and tenant case
of Tennant Radiant Heat v Warrington Development Cor-
poration [1988] 1 EGLR 41, the tenant was responsible for
one rainwater outlet and the council for the other 23 out-
lets. When a roof collapsed under the rainwater because of
blocked outlets the Court of Appeal made an apportionment
of the two concurrent causes one against the landlord in
tort and the other a claim in contract under the tenant’s
repairing covenant. The apportionment of 90% landlord and
10% tenant was made “as a matter of causation”. That case
was followed in W Lamb Ltd v J Jarvis & Sons plc (1998) 60
ConLR 1 to apportion liability between a contractor and sub-
contractor where both were equally responsible for defective
work. However the principle of apportionment was criticised
in Bank of Nova Scotia v Hellenic Mutual Risks Association
(Bermuda) Ltd [1990] 1 QB 818 at 904 where it was said “we
merely add respectfully our view that the scope and extent
of this last mentioned case would have to be a matter of
substantial argument if the principle there applied were to
arise for consideration in another case.”
33. It is important to distinguish between apportionment
of the type set out above and apportionment of damages
which is based upon the principle that each party is liable
for the damage which it has caused. In the United States, for
instance, the Federal Court of Appeals said in Blinderman
Construction Inc v US 695 F2d 552 (1983) that “Where both
parties contribute to the delay neither can recover damage
unless there is in the proof a clear apportionment of the
delay and expense attributable to each party.”
34. It has been suggested that some support for apportion-
ment can be derived from the decision in Peak Construction
(Liverpool) Ltd v McKinney Foundations Ltd [1970] 1 BLR 111
where Salmon LJ referred to apportionment in the context of
a claim by the main contractor for damages for delay caused
by defects in the sub-contractor’s piling. The overall delay
was 58 weeks but some of the delay had been caused by
the Employer’s delay in approving the remedial works. The
Contractor was not liable to the Employer for liquidated dam-
ages because the Employer had contributed to the delay and
there was no provision for granting an extension of time for
that delay. On the appeal Salmon  LJ said at 119 that some
judges might say that the major part of the 58 week delay
was caused by the sub-contractor’s breach; some might say
less and that “this court would not interfere, because such
an apportionment is a matter on which opinions may reason-
ably differ”. That seems to be saying that the apportionment
of the 58 weeks delay has to be made on the basis of cau-
sation but does not deal with concurrent causes or general
principles of apportionment.
35. In City Inn, in dismissing the appeal, Lord Osborne said:
“the focus for consideration by the architect, or other
6 Informa Law & Finance
Issue Spring 2011
decision-maker, requires to be the cause for the delay
in the completion of the works, upon a fair and reason-
able view. Thus, it may not be of importance to identify
whether some delaying event or events was or was not
concurrent with another, in any of the possible narrow
senses described, but rather to consider the effect upon
the completion date of relevant events and events not
relevant events. For that reason, discussion of whether
or not there is true concurrency, in my opinion, does not
assist in the essential process to be followed under clause
25. Having said that, however, I would endorse the view
of the Lord Ordinary that where two causes, neither of
which is dominant, are under consideration, a relevant
event and a non-relevant event, it may be appropriate for
the architect or decision-maker to apportion responsibility
for the delay between the two causes.”
36. Lord Kingarth agreed with Lord Osborne but Lord Carloway
took a different view. He commented at [112] on the passage
in the judgment of Lord Drummond Young where he said
there should be apportionment and said that it was not an
exercise warranted by any term of the contract.
37. There are also problems with the practical application
of the principle of apportionment. The way in which the Lord
Ordinary approached the matter was similar to that under the
Civil Liability (Contribution) Act 1978 and was set out at [159]
of his judgment:
“That leads on to the question of how the exercise of ap-
portionment is carried out. That exercise is broadly similar
to the apportionment of liability on account of contributo-
ry negligence or contribution among joint wrongdoers. In
my opinion two main elements are important: the degree
of culpability involved in each of the causes of the delay
and the significance of each of the factors in causing the
delay. In practice culpability is likely to be the less impor-
tant of these two factors. Nevertheless, I think that in ap-
propriate cases it is important to recognize that the seri-
ousness of the architect’s failure to issue instructions or of
the contractor’s default may be a relevant consideration.
The causative significance of each of the factors is like-
ly to be more important. In this respect, two matters
appear to me to be potentially important. The first of
these is the length of the delay caused by each of the
causative events; that will usually be a relatively straight-
forward factor. The second is the significance of each of
the causative events for the Works as a whole. Thus an
event that only affects a small part of the building may
be of lesser importance than an event whose effects run
throughout the building or which has a significant effect
on other operations. Ultimately, however, the question is
one of judgment.”
38. In relation to loss and expense under clause 26 he re-
ferred to John Doyle v Laing Management [2004] BLR 295 at
[16] to [18] where Lord Macfadyen had said this:
“[16] … even if it cannot be said that events for which the
 Issue Spring 2011
employer is responsible are the dominant cause of the
loss, it may be possible to apportion the loss between the
causes for which the employer is responsible and other
causes. In such a case it is obviously necessary that the
event or events for which the employer is responsible
should be a material cause of the loss. Provided that con-
dition is met, however, we are of opinion that apportion-
ment of loss between the different causes is possible in
an appropriate case. …
Where the consequence is delay as against disruption,
that can be done fairly readily on the basis of the time
during which each of the causes was operative. During
the period when both operated, we are of opinion that
each should normally be treated as contributing to the
loss, with the result that the employer is responsible for
only part of the delay during that period. Unless there are
special reasons to the contrary, responsibility during that
period should probably be divided on an equal basis, at
least where the concurrent cause is not the contractor’s
responsibility. Where it is his responsibility, however, it
may be appropriate to deny him any recovery for the
period of delay during which he is in default.
[17] Apportionment in this way, on a time basis, is rela-
tively straightforward in cases that involve only delay.
Where disruption to the contractor’s work is involved,
matters become more complex. Nevertheless, we are of
opinion that apportionment will frequently be possible in
such cases, according to the relative importance of the
various causative events in producing the loss ...”
39. Lord Drummond Young said this as to John Doyle v Laing
Management at [166]:
“In that case it is recognized at paragraphs [16]–[18] that
in an appropriate case where loss is caused both by
events for which the employer is responsible and events
for which the contractor is responsible it is possible to
apportion the loss between the two causes. In my opinion
that should be done in the present case. This is a case
where delay has been caused by a number of different
causes, most of which were the responsibility of the em-
ployer, through the architect, but two of which were the
responsibility of the contractor. It is accordingly necessary
to apportion the defenders’ prolongation costs between
these two categories of caused. I consider that the same
general considerations, the causative significance of each
of the sources of delay and the degree of culpability in
respect of each of those sources, must be balanced. On
this basis, I am of opinion that the result of the exercise
should be the same; I am unable to discover any reason
for treating the two exercises under clause 25 and clause
26 on a different basis. I accordingly conclude that the
defenders are entitled to their prolongation costs for nine
weeks.”
40. In coming to the conclusion at [161] on the exercise of
apportionment Lord Drummond Young said:
e Informa Law & Finance 7
TECBAR
“Taking all these circumstances into account, I am of
opinion that the part of the total delay apportioned to
Relevant Events should be substantially greater than that
apportioned to the two items for which the defenders are
responsible. I consider that a fair and reasonable result
would be that the defenders are entitled to an extension
of time of nine weeks from the original Completion Date.
On that basis I conclude that completion has been de-
layed beyond the completion Date by Relevant Events for
a period of nine weeks, or until 29 March 1999.”
41. On analysis, the way in which apportionment worked
was to consider what was “fair and reasonable” and it is dif-
ficult to see how the concept of “apportionment” assisted in
coming to the conclusion that the contractor was entitled to
an extension of time of nine weeks until the date of Practical
Completion. That result, it may be thought, could have been
achieved without using “apportionment”.
Conclusion
42. The basis for assessing extension of time starts with a
breach or event which causes delay. It is that delay which
has to be assessed to give a “fair and reasonable” exten-
sion of time. That process is not prescribed and leaves the
person making the assessment of the appropriate extension
of time a wide area of discretion in which to act. Similarly
when assessing loss there is a wide range of assessment in
which the appropriate figure may fall. If in the end there is a
delay or a loss which is concurrent then an approach which
moves towards apportionment based on statutory principles
of joint liability does not seem to provide a necessary solu-
tion to the problem or one which is consistent with English
law. It causes difficulties when it is laid against the principle
that in cases where there is no extension of time provision
the party cannot recover damages. The concept of a “fair
and reasonable” extension of time must be based on delay
caused by a relevant event and complex analysis in an at-
tempt to apply apportionment may hide rather than prove
the true cause of delay.
43. The decision in City Inn was not, on analysis, a com-
plex case and the ultimate decision on extension of time
and loss does not seem to have depended on a result which
required the concept of apportionment. It had been hoped
that this important aspect might be considered by the Su-
preme Court under the easier route of a case on appeal from
Scotland or Northern Ireland. By settling the appeal, the par-
ties have evidently come to an sensible decision but have
left the law in an unsatisfactory state. One day a decision
of the TCC may be found which merits consideration by the
Supreme Court so as to provide much needed guidance.
Mr Justice Ramsey
TECBAR
Part 8 Claims and adjudication business
1. Adjudication business has been a significant part of the
TCC’s case load for the last decade or so and, if 2010 is any
guide to the future, the stream of work shows little sign of
abating. Most of the work relates to actions for summary
enforcement of adjudicator’s decisions for payment; such
actions are typically begun under Part 7 of the CPR1 with
an application for directions following the procedure set out
in the TCC Guide. However, there is an established steadily
growing number of Part 8 claims being issued and decided in
the TCC which concern adjudication.
2. CPR 8.1(2) provides that a claimant may use the Part 8
procedure where he seeks the court’s decision on a question
which is unlikely to involve a “substantial dispute of fact”.
3. CPR 8.2 provides that the claimant who uses Part 8 must
state, inter alia, the question which he wants the court to
decide. This reflects the principal use for which the Part 8
procedure is used, namely the determination of questions
of law including issues as to the proper construction of con-
tracts. The relief sought will normally be declaratory relief,
which is a discretionary remedy.
4. Part 8 does not provide for statements of case, disclo-
sure or a CMC. Any evidence the claimant wishes to adduce
should be provided with the Claim Form and any evidence
from the defendant should be filed with his acknowledge-
ment of service. The Part 8 procedure is expected to be docu-
ment light. As a result, the Part 8 procedure can be speedy
and relatively inexpensive but it is not suitable for determi-
nation of complex issues of fact.
Issues of fact
5. Most construction disputes concern issues of fact that will
not be capable of being tried quickly under Part 8. Forest
Heath District Council v ISG Jackson2 was such a case. An
adjudicator had awarded Jackson an extension of time. One
of his findings was that Jackson had decided to paint steel
on site due to the late finalisation of the steelwork design (a
matter for which the council was responsible). The claimant
sought a declaration that the decision to paint steelwork on
site was not taken due to late finalisation of the steelwork
design. The claimant did not suggest that such a declaration
would render the adjudicator’s decision null and void and
this was not a case where the claimant was seeking to use
Part 8 to avoid enforcement.
6. The Court declined to grant relief because there were
issues of fact that the Court could not determine on the doc-
uments alone: see para [36].
1 Para. 9.2.1 of the TCC Guide states that if the enforcement proceed-
ings are known to raise a question which is unlikely to involve a sub-
stantial dispute of fact and no monetary judgment is sought, CPR Part 8
proceedings may be used instead.
2 [2010] EWHC 322 (TCC).
8 Informa Law & Finance
Issue Spring 2011
7. The circumstances where a Part 8 claim will often arise
for consideration in relation to adjudication may be catego-
rised as follows:
(i) A claim to establish or to refute the existence of a right
to adjudicate or to ascertain the terms governing any
adjudication.
(ii) A claim alleging a breach of natural justice.
(iii) A claim that seeks a final decision from the Court.
(i) A claim to establish or to refute the existence of a
right to adjudicate or ascertain the applicable terms
8. Disputes as to the contract terms or whether a contract
falls within the scope of the HGCRA are questions that tend
not to involve a “substantial dispute of fact”. Issues may
include the following3:
(i) Questions of contract formation tend to be capable
of resolution by reference to the documents passing
between the parties.
(ii) Issues as to the nature of the works to be carried out
can be resolved by reference to the description of the
work in the parties’ contract together with where nec-
essary some evidence to explain what the work entails.
Issues as to the principal activity undertaken on the site
may require some evidence of fact but this is unlikely
to be the subject of a substantial dispute. Such disputes
will often be suitable for a Part 8 claim.
(iii) The question whether there is a dispute capable of giv-
ing rise to an adjudication is normally one where the
result will be apparent from documents.
9. Recent examples of cases in category (i) above include
Yuanda (UK) v WW Gear Construction4 and Banner Holdings
v Colchester Borough Council5. In Yuanda the claimant ob-
tained a declaration in Part 8 proceedings that an adjudica-
tion clause was incompatible with the HGCRA because it fet-
tered the right to adjudicate. In Banner Holdings the claimant
sought a declaration as to the adjudicator’s jurisdiction.
10. A recent example of type (ii) above is provided by
North Midland Construction v AE  &  E Lentjes6. North Mid-
land sought declarations that its works were “construction
operations” within the meaning of section 105 of the HGCRA
and did not fall within one of the exceptions described in
section 105(2)(c) (“the assembly, installation or demolition
of plant or machinery, or erection or demolition of steelwork
for the purposes of supporting or providing access to plant
or machinery”). Ramsey J granted the declarations sought in
relation to those issues. However, the Court declined to grant
3 See TCC Guide para. 9.4.1.
4 [2010] EWHC 720 (TCC), [2010] BLR 435.
5 [2010] EWHC 139 (TCC).
6 [2009] EWHC 1371 (TCC), [2009] BLR 574.
 Issue Spring 2011
declarations relating to responsibility for the design of the
foundation earth bonding and whether the defendant had
instructed a change to the works when issuing plans giving
details of the foundation earth bonding. These were issues
that required more detailed investigation in order for the
Court to determine them.
11. The Part 8 claim may be made before, during or after
adjudication. Applications under Part 8 during an adjudication
are common: see, for example, ABB Zantingh v Zedal Build-
ing Services7; Dalkia Energy and Technical Services Ltd v Bell
Group UK Ltd8 and Rok Building v Bestwood Carpentry9. In the
last mentioned case Akenhead J noted that the parties had
sensibly agreed that the Court should rule on the jurisdictional
issues before the adjudication proceeded to any conclusion.
12. Where there is a genuine issue as to whether the con-
tract contains an adjudication agreement or is subject to the
provisions of the HGCRA, it will often be convenient to ask the
Court to decide the question before an adjudication is start-
ed. This avoids the risk that much time and money is spent
on what might turn out to be a futile adjudication: see the
comments of Coulson J in Vitpol Building Service v Samen10.
(ii) A claim alleging a breach of natural justice
13. Allegations of a breach of natural justice may involve
allegations of actual or apparent bias on the part of the ad-
judicator or, more commonly, an allegation that a party (nor-
mally the respondent) has been denied a proper opportunity
to respond to the referral, or that the adjudicator failed or
refused to consider a defence or a submission that was put
to him. It is only in a clear case that such arguments will
achieve the aim of avoiding enforcement.
14. It might be thought that a party which perceived itself
to be the victim of a breach of the rules of natural justice
should seek relief immediately before the adjudication goes
any further and results in potentially wasted cost, rather than
awaiting an enforcement application to pursue the complaint.
Whether or not such a course is appropriate will depend on
the complaint that is being made.
15. For example, in a case where apparent bias is alleged
eg, the adjudicator is a solicitor, expert or barrister who hap-
pens to be instructed by one of the parties in relation to an-
other matter, the directions and decision that the adjudicator
makes would seem to be immaterial to the question whether
the test for apparent bias is met. In such a case an applica-
tion for removal could be made promptly.
16. However, in the case where the complaint is that the
adjudicator failed or refused to take account of a defence, it
will be difficult if not impossible to prove a breach of natural
justice before the decision is published.
7 [2001] BLR 66.
8 [2009] EWHC 73 (TCC).
9 [2010] EWHC 1409 (TCC).
10 [2008] EWHC 2283 (TCC) at para [16].
e Informa Law & Finance 9
TECBAR
17. In between these two extremes come the cases where
it is said the timetable was too tight for there to be a fair and
impartial determination of the issues. The use of adjudica-
tion to decide a multitude of issues, e.g. final account type
claims, is commonplace. Many such claims are seasonal with
the largest emerging bi-annually in the months of December
and July. The result, intended for or not, is that the Refer-
ral and the associated boxes arrive during the respondent’s
Christmas party, or just as his QS starts a summer vacation.
18. In Enterprise Managed Services v Tony McFadden Utili-
ties11, Coulson J observed that “the adjudicator has to decide
at the outset whether or not he can discharge his duty to
reach a decision impartially and fairly within the time limits
prescribed by the Act. If he cannot he ought to resign” (para
[93]). In paragraph [97] Coulson J suggested the enthusiasm
of some adjudicators to grant piecemeal extensions and per-
mit “creep” in large and paper-heavy final account disputes
should be curbed. However, the Court will not readily inter-
vene where an adjudicator has decided that he can fairly
reach a decision.
19. In Dorchester Hotel v Vivid Interiors12 the responding
party to a final account claim issued a Part 8 claim for decla-
rations that there was a serious risk of a breach of the rules
of natural justice unless the current timetable for the adjudi-
cation was revised to allow it more time. Whilst recognising
the jurisdiction to grant such relief in an ongoing adjudica-
tion, the Court declined to grant the relief sought: see the
following passages in Coulson J’s judgment.
“such a jurisdiction will be exercised very sparingly. It will
only be appropriate in rare cases for the TCC to intervene in
an ongoing adjudication. It is important that, wherever possi-
ble, the adjudication process is allowed to operate free from
the intervention of the court. Applications of this sort will be
very much the exception rather than the rule.” (para [18])
“The concepts of natural justice which are so familiar to
lawyers are not always easy to reconcile with the swift and
summary nature of the adjudication process; and in the
event of a clash between the two, the starting point must
be to give priority to the rough and ready adjudication pro-
cess. It seems to me that such an approach is even more
necessary in circumstances where, as here, it may be said
that the breaches of natural justice have not yet occurred
and, depending on what happens, may never in fact arise.”
20. The Court’s reasons for rejecting the application may be
summarised as follows.
(i) The adjudicator was to be accorded a wide discretion to
fix the timetable so the Court would rarely intervene.
(ii) The adjudicator had a continuing duty to act fairly. The
Judge referred to the possibility that the adjudicator might
have to extend the timetable (see para [27] of the judg-
ment). This provided some protection to the claimant.
11 [2009] EWHC 3222 (TCC), [2010] BLR 89.
12 [2009] EWHC 70 (TCC), [2009] BLR 135.
TECBAR
(iii) The time allowed for the claimant’s response although
short could not be said to be incapable of permitting a
fair result. The claimant would have the last word in its
rejoinder.
(iv) The Court could not form a view on the significance
of the new material identified by the claimant, or the
amended figures in the final account.
(v) As a matter of discretion the Court also took into
account the ability of the claimant to resist enforcement
later on should it wish to do so.
21. The making of an application, even if unsuccessful, may
result in the adjudication timetable being revised to the ben-
efit of the applicant. The Dorchester case suggests that the
scope for obtaining relief before the adjudication is complete
will be limited to cases of bias and extreme irregularity in the
conduct of the adjudication.
(iii) A claim that seeks a final decision from the
Court
22. The parties must comply with the adjudicator’s decision
until the dispute is finally determined. Section 108(3) of the
HGCRA provides:
“The contract shall provide that the decision of the adjudi-
cator is binding until the dispute is finally determined by
legal proceedings, by arbitration (if the contract provides for
arbitration or the parties otherwise agree to arbitration) or
by agreement. The parties may agree to accept the decision
of the adjudicator as finally determining the dispute.”
23. In the absence of an applicable arbitration clause, the
Court will normally be the final arbiter of the dispute. The
obligation to comply with the decision of the adjudicator is
not affected by the commencement of a Part 8 claim.
(a) Seeking a final decision to avoid enforcement
24. There have been cases in which the Court has listed en-
forcement applications to be heard at the same time as Part
8 claims seeking a final decision in respect of the same dis-
pute. In this way the losing party in the adjudication has
been able to avoid enforcement by getting in first and obtain-
ing a different outcome from the Court.
25. The TCC Guide provides for the possibility that 2 claims
may be issued in respect of a single dispute. Paragraph 9.4.3
provides as follows.
“It sometimes happens that one party to an adjudication
commences enforcement proceedings, whilst the other
commences proceedings under Part 8, in order to challenge
the validity of the adjudicator’s award. This duplication of
effort is unnecessary and it involves the parties in extra
costs, especially if the two actions are commenced at dif-
ferent court centres. Accordingly there should be sensible
discussions between the parties or their lawyers, in order to
agree the appropriate venue and also to agree who shall be
claimant and who defendant. All the issues raised by each
party can and should be raised in a single action.”
10 Informa Law & Finance
Issue Spring 2011
26. Where a dispute can be finally determined before or at
the same time as the enforcement hearing that will normally
be in the best interests of the parties and consistent with the
overriding objective: see the reasons given in Alstom Signal-
ling v Jarvis Facilities13. In the Alstom case the Adjudicator de-
cided that Alstom should pay approximately £1.3m to Jarvis
based on his interpretation of the payment terms. Alstom
issued a claim for various declarations including declarations
to the effect that the Adjudicator was wrong to decide that
payment was due from Alstom to Jarvis. A week later Jarvis
issued a claim and an application for summary judgment.
The actions were listed to be heard together. The Court found
that the Adjudicator had erred in deciding that the sum due
to Jarvis was the sum it had applied for and that he had
thereby failed to decide the sum due to Alstom14.
27. Supposing that the Adjudicator’s error of law in Alstom
had not been interpreted as one which meant that he had
failed to decide the dispute referred to him, would relief have
been granted then? Having regard to section 108 (3) it is
submitted that the decision would have been enforced. The
Court would not have been able to finally decide the dispute
because the Court could not ascertain the amount due15. The
Court might have decided to give declarations as to the true
construction of the contract but the decision would have re-
mained enforceable.
28. In Geoffrey Osborne v Atkins Rail16 Atkins obtained
declaratory relief to the effect that the Adjudicator’s decision
was in error in ordering a payment to be made to Osborne.
The dispute concerned the valuation of two items of work
and Osborne’s Notice sought an order for payment of such
sum as the Adjudicator thought fit. No issue of fact arose be-
fore the Court because it was common ground that an error
had been made in that the Adjudicator did not give credit for
sums paid or allowed to Osborne when arriving at his deci-
sion. The Court gave a declaration that the Adjudicator was in
error and declined to enforce that part of the decision.
Continues on page 12
13 [2004] EWHC 1285 (TCC) at para [20].
14 See para [35]. It may be debatable whether the adjudicator’s mistaken
interpretation of the contract rendered his decision a nullity. In Carillion
Construction v Devonport Royal Dockyard [2005] EWHC 778 (TCC) Jackson
J (as he then was) noted that “In borderline cases what one judge may
regard as a permissible error of law or procedure on the part of an ad-
judicator, another judge may characterise as excess of jurisdiction or a
substantial breach of the rules of natural justice” (para [79]). He went
on to identify five propositions (see para [81]) which the Court of Appeal
expressed broad agreement with (see [2005] EWCA Civ 1358, [2006] BLR
15 at para [84]).
15 See para [35] of the judgment: “Entitlement, one way or the other,
requires further investigation”.
16 [2009] EWHC 2425, [2010] BLR 363.
 Issue Spring 2011 TECBAR

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e Informa Law & Finance 11

TECBAR
Continued from page 10
29. The difficult issue that arises from the decision in
Osborne is that a valid decision was not enforced in circum-
stances where the Court could not finally decide the dispute
which had been referred to the Adjudicator. The Court could
not decide the value of the two items of work (see para [25]
of the judgment) and therefore it could not finally decide the
dispute which the adjudicator had decided. The BLR com-
mentary suggests that the decision should be construed as a
final determination under Part 8 of the outstanding balance
due to Osborne which was part of the dispute referred to
the Adjudicator. It is respectfully suggested that so construed
the decision would still be at odds with section 108(3). Fur-
thermore, the determination would not be “final” given that
the Adjudicator’s value of the two items of work might be
later revised and this would be likely to result in an adjusted
balance. In Pilon v Breyer17 Coulson J distinguished Osborne
and suggested that Osborne is a case on its own particular
facts. The fact that the parties in Osborne agreed what the
Adjudicator’s decision was intended to mean was plainly a
significant, if not decisive, factor in the decision.
(b) Seeking a final decision on part of a dispute post
adjudication
30. A claimant may seek a final declaration in relation to part
of a dispute referred to an adjudicator. As noted above and
save in exceptional cases, the decision of the adjudicator
should stand by virtue of section 108(3). This is so even if
one of the reasons for the decision, or one part of the deci-
sion itself, has been found to be in error by the Court. The
decision remains enforceable pending resolution of all issues
decided by the adjudicator. If, however, there is a discrete is-
sue that is central to the decision and which the adjudicator
may have wrongly decided18, a Part 8 claim offers a relatively
inexpensive and speedy means of obtaining a final decision
which can be used to facilitate settlement without the need
for the whole of the dispute to be litigated.
31. In Forest Heath the Court indicated that even if it had
been able to decide the issues of fact it would have refused
declaratory relief because it would not lead to a final deter-
mination of the dispute that had been referred to adjudica-
tion. Ramsey J’s judgment provides the following guidance.
17 [2010] EWHC 837 (TCC), [2010] BLR 452. See paras [33] and [34].
18 The Alstom v Jarvis case is a good example of the sort of issue in this
category.
Readers are invited to submit material by email to be considered for
possible publication. This may consist of correspondence, short articles
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ISSN 1472 0078
© Informa UK Limited and TECBAR 2011
Editor: Mark Chennells
12 Informa Law & Finance
Issue Spring 2011
“I accept Mr Stansfield’s submission that a useful analo-
gy is to be found in the approach of the Court in ordering
the trial of preliminary issues. This is a case where there
was a dispute between the parties related to the overall
extension of time. In such circumstances the court would
be unwilling, in my judgment, to order a preliminary is-
sue of the cause of the decision to paint steelwork on site
where that opened up an area of factual investigation and
where the ultimate outcome in terms of extension of time
would be unclear. I consider that similar considerations
apply to the declaration sought in this case.” (para [45]).
32. The considerations that apply in deciding whether to or-
der a preliminary issue are set out in section 8 of the TCC
Guide. The threshold test is whether the issue meets the
significance criteria described in paragraph 8.2.1 as follows.
“The court would expect that any issue proposed as a
suitable PI would, if decided in a particular way, be ca-
pable of:
• resolving the whole proceedings or a significant
element of the proceedings; or
• significantly reducing the scope, and therefore the
costs, of the main trial; or
• significantly improving the possibility of a settlement of
the whole proceedings.”
33. In a case where the adjudicator has made an error of law
that undermines his conclusions in relation to a significant
part of the dispute Part 8 relief may offer a possible route to
the final resolution of the dispute.
Other grounds on which relief may be refused
34. The Court may refuse to entertain a Part 8 claim where
the contract provides that adjudication is mandatory and no
adjudication has been completed: DGT Steel v Cubitt.19
35. The existence of an arbitration agreement would pre-
clude a final determination by the Court since only the arbi-
trator could make a final decision (assuming the defendant
sought a stay): see Pilon v Breyer.
Steven Walker
25 March 2011
19 [2007] EWHC 1584 (TCC), [2007] BLR 371.
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