What is a concurrent delay?
The generally accepted definition of concurrent delay is “a period of project overrun which is caused by two or more effective causes of delay which are of approximately equal causative potency.”
Instances of “true” concurrency in this sense are in reality very rare, and more often than not it will be the case that, through a factual analysis of the day to day progression of a construction project, one cause of delay will be of greater “causative potency” than the other events that are alleged to be “concurrent”.
Notwithstanding the relatively limited practical application of concurrent delay, recent developments have confirmed that the potential effects of concurrent delay are not limited to the contractor’s ability to recover compensation for prolongation.
Subject to the express provisions of the contract, instances of concurrent delay may extinguish a contractor’s right to an extension of time and expose it to a liability for liquidated damages.
Succeeding in an extension of time claim
An entitlement to an extension of time does not create an automatic right to recovery of prolongation costs and loss and expense. In order to succeed in such a claim, a contractor will need to demonstrate that it was delayed by a compensable delay event, that the costs it incurred are recoverable, and that they were incurred as a result of the compensable delay event.
The objective of a payment for prolongation and loss and expense is to put the contractor in the same financial position it would have been in if the compensable delay event had not occurred.
Accordingly, payment for prolongation should be based on the actual costs incurred by the contractor during the period that the delay was suffered, and care should be taken to remove costs for resources that were not affected by the delay event.
Consideration should also be given to the existence of concurrent delay. Whilst true concurrency is relatively rare, to the extent that it does exist, it may significantly reduce (or eliminate) the contractor’s entitlement to recovery of costs if the concurrent delay was caused by matters which are the responsibility of the contractor.