Tue 02 Nov 2021

What is a Relevant Event and what effect does it have on the completion date?

A Relevant Event is an event or set of circumstances which can entitle the contractor to an extension of time. We will use the SBCC Design & Build Contract 2016 ("the Contract") as an example again. However, it should be noted that there could be bespoke amendments which change the standard form provisions.

The Contract allows for entire completion or sectional completion. The method of completion and completion date are set out in the Contract Particulars.  As the Contract states at the completion date, the works (or sections of work) must be completed by that date.  If your contract does not specify a completion date, the works must be completed within a reasonable time.

In some circumstances the Contract allows the contractor to seek to delay the completion date(s).  The contractor must notify the employer "whenever it becomes reasonably apparent" that there will be delay to the progress of the works. This notice also acts as the contractor's application to delay the completion date (where appropriate). However, a notice of delay must be given even if no extension of time is sought.

The notice must be given in writing and set out the material circumstances, estimated delay and any other effects arising from these circumstances, and what, if any, Relevant Event has occurred. The Contract lists 14 Relevant Events; however, parties can agree to include further events.  For example, contracts entered into after March 2020 may include COVID-19 specifically or pandemics generally as a Relevant Event. Given the current materials shortage and corresponding price rises, parties may also wish to provide for that as a Relevant Event.

The current standard Relevant Events include amongst others:

  • Changes to the works;
  • Delay in the employer giving the contractor possession of the site;
  • Impediment, prevention or default by the employer, except insofar as caused or contributed to by the contractor;
  • Exceptionally adverse weather;
  • Strike or lockout by the trades employed on site; and
  • Force majeure

If a Relevant Event has occurred and has caused or is likely to cause delay of the work beyond the completion date, the contractor will be entitled to additional time which delays the completion date. If, however, the delay is attributable to causes other than a Relevant Event, no additional time can be given.

The change to the completion date can affect the damages which the employer may be entitled to for late completion. It is therefore in the contractor's interests to validly notify a delay.

Next week we will look at the process for extensions of time being granted.   If you haven’t read our week one delay blog, it can be found here.

Should you require assistance with any aspect of a construction contract, we have a large and experienced construction team who would be happy to discuss this with you.

First published by Scottish Construction Now.

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