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ARTICLE · 05 JUNE 2016

Construction delay: whose breach?

We discuss prolongation costs in construction.

AustraliaReal Estate and Construction

If rainy weather prevents you from getting the job done on time, virtually all construction contracts will allow you to claim an extension of time (EOT). In fact, for reasons we will consider in another blog, your head contractor or principal may benefit from granting you an EOT so that it can claim liquidated damages if you do not practically complete your works by the extended time for completion.

However, contractors often want to take their delay-claim a step further by also seeking to be compensated for the losses that they suffer by having to "man-down" or keep their labour and machinery idle on site while they wait for delayed head works to catch up to them. This kind of loss is commonly known as "prolongation costs".

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