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Building and construction contract delays and COVID-19

Updated: Mar 18, 2021

Like most industries, building and construction is feeling the impacts from the evolving Coronavirus (COVID-19) situation. From material delays to workplace risk management issues, the scope of disruption continues to grow in scale. So, given the unique and unprecedented situation, what should you be considering from a contract perspective?

Review your contracts

While it is unlikely that your contracts will include a clause specific to a pandemic, there may be other inclusions that provide grounds for an extension of time. Common clauses may include the following:

  • Unavailability of labour necessary to carry out the work.

  • Unavailability of materials necessary to carry out the work.

  • Reasons beyond the reasonable control of the contractor and not reasonably foreseeable at the time the contract was signed.

  • Force majeure, a clause that details a list of events beyond the reasonable control of each party and the rights and obligations in the event they occur.

Pay close attention to contract details regarding making a claim for an extension, including the manner in which it should be made, stipulated timeframes and record keeping requirements.

Make a claim for an extension

If you have grounds to claim for an extension of time and the need arises, consider the following:

  • Provide notice as soon as the delay is apparent.

  • Act in accordance with the contract provisions for the service of notices.

  • State the reasonable estimate for the period of delay.

  • Follow the required approval and record keeping requirements.

Seek legal advice

Unlike common issues that cause contract delays, the scope of impact from Coronavirus (COVID-19) is still unknown and when considering possible, long-term contract delays, this can become complex.

If your contract/s do not provide clear scope for a pandemic situation, talking with a lawyer can help provide clarity for your specific situation. In addition to valuable insight into your rights and available remedies, a legal expert can also provide advice on how to effectively communicate contract delays during this difficult time.

Do you need some [legal] help? Get in touch with our team for a confidential discussion about your specific situation.

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