The problem of bad weather is back in the business news again as a reason for another major infrastructure project (this time the Aberdeen ring road or the 'Aberdeen Western Peripheral Route') running late. The small inconvenience caused by Carillion's liquidation might also have had something to do with the projected delay as it left the other two JV partners (Galliford Try and Balfour Beatty) to pick up the pieces.
I've written previously on the need, when agreeing construction contracts, to deal with the risk of delays being caused by bad weather. Indeed, only today I have been negotiating a contract where the issue of the contractor's entitlement (if any) to time and/or money for delay caused by bad weather has been the subject of some 'discussion' between the parties and their advisers. A solution has been found.
To be more precise the JCT suite of contracts uses the term 'exceptionally adverse weather conditions' as being a Relevant Event for the purpose of gaining an extension of time. But what does 'exceptionally adverse weather conditions' actually mean? Would the recent 'Beast from the East' qualify or are we referring back to the winters of 1947 and 1963 for example? The JCT contracts do not define what it means which is not very helpful to anyone. Other forms of contract do.
The solution? One obvious answer is for the parties to agree what it does mean so that everyone is clear. Of course, the next issue for 'discussion' is reaching an agreed definition but that is never, in my experience, too hard to achieve. And a big benefit of defining what you mean by 'bad weather' before signing on the dotted line is that the meaning is not left open for 'debate' at a later date. That option carries with it the risk of the meaning being decided by an adjudicator or judge and is one that could prove very costly to all concerned, so best avoided.
Construction and housing company Galliford Try is facing higher bills to build Aberdeen’s troubled ring road after bad weather caused delays. The construction of the Aberdeen Western Peripheral Route was a joint venture between Galliford Try, Balfour Beatty and Carillion, but when the latter collapsed in January, the remaining two partners were left to finish the job.