White Christmas in sight? The effects of adverse weather in construction contracts

As the mornings become frosty throughout the UK, what were previously only predictions of bad weather, have now become a reality.

The impacts of bad weather on construction projects are various and will often include delays, additional cost and, in some extreme cases, even defects in work in progress. Despite the occurrence of bad weather, the contractor will not be automatically entitled to an extension of time or an increase in the contract price.

It is therefore worth considering: when does a weather event give entitlement to an extension of time, or increase in price/contract sum?

This article addresses this question with reference to the JCT and NEC forms of contract.

JCT

Under the JCT form of contract the risk associated with weather is, in effect, shared. While "exceptionally adverse weather conditions" is a Relevant Event, meaning the Contractor can claim an extension of time; it is not a Relevant Matter which would entitle the Contractor to loss and expense.

A Contractor operating under the JCT standard form, when looking to receive an extension of time to the Completion Date for delays caused by exceptionally adverse weather conditions, will need to: (1) give notification that the progress of the works will likely be delayed; and (2) prove that the weather condition (or conditions) experienced is a Relevant Event, as defined in the contract.

In relation to (1), the notification must be in writing and set out the cause of the delay. The Contractor is also required to provide at the time of the notification, or shortly thereafter, the particulars of the effects (e.g., time of expected delay), and to advise in further notices if circumstances change.

Regarding (2), the JCT Contract does not provide a definition or guidance on what constitutes "exceptionally adverse weather conditions", however there will be a requirement to show the weather was not only "adverse" but also "exceptional" and this will be done by reference to historic weather records in order to demonstrate that the weather experienced was not the norm.

NEC3 AND NEC4

In contrast to the JCT form of contract, a Contractor that complies with the conditions of the NEC contract can claim both an extension of time to the completion date and an increase in contract price. This is because a weather event may be a compensation event under Clause 60.1.

A weather event will be a Compensation Event if: (1) it is notified timely under Clause 61.3, namely within 8 weeks of the Contractor becoming aware of the event; and (2) where the Contractor complies with Clause 60.1. This is the case under both the NEC 3 and NEC 4 Engineering and Construction Contract.

To claim a Compensation Event for bad weather the Contractor must demonstrate that the weather conditions claimed occur, on average, less frequently than once in 10 years. This is done by reference to the contract data. The contractor's claim should be the difference between the average data and the weather condition claimed for.

Contractors would be wise to ensure that the place where the weather is to be recorded is as close to the site as possible, to ensure the weather conditions on which a claim can be made are as similar as they can be to the conditions actually experienced on site.

Key takeaways:

Be aware from the outset of which party takes the risk of weather events, and what remedies are available where adverse weather is experienced.

Ensure that you notify claims timeously, to avoid losing your right

Only claims for weather which are out with the norm will entitle you to additional time and/or money (depending on the specific contract terms). Ensure therefore, that the possibility of bad weather is considered when programming and pricing your works.