A contractor completes a project in 50 weeks (JCT Major Projects). The Contract completion dates was 40 weeks after commencement on site and therefore the project is finished 10 weeks late.
After week 40 the CA issues a certificate of non-completion and the Employer deducts LADs from the Contractor for a period of 10 weeks up to the issue of a Practical Completion certificate (50 weeks).
In the week after PC is granted an instruction is issued requesting the Contractor complete a variation which results in a further 2 weeks work being carried out. The Contractor carries out the work which under normal circumstances would be considered a Relevant Event and would entitle the Contractor to an EOT.
Using the “net” approach when considering EOT requests would the contractor be entitled to a revised Completion Date after 42 weeks, and with PC being achieved on week 50 would the Employer’s LAD recovery reduce from 10 weeks to 8 weeks?
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I’d be interested in the answer to this one. Personally, I don’t think any contractual provisions that allow the granting of an EoT after PC should apply here, as I believe the intent of such provisions are to review pre PC events, further information provided etc and to determine the completion date accordingly.
In my opinion, if there were no grounds for an EoT up to PC, the entitlement to LAD’s stands. In turn, the contractor is entitled to the cost of all preliminaries incurred (not necessarily on a pro rata basis from the contract rates) for essentially returning to site a week after PC to undertake the variation.
The quick and easy answer is no.
The general principal is that a CA only has power to issue an instruction requiring a variation after PC if the contract expressly allows for it. JCT is a bit vague on this point, but case law also says that, under JCT contract, the contractor’s obligation to comply with instructions requiring a variation ends at PC. So whilst the CA may be able to issue an instruction to carry out extra work, the contractor is not obliged to do the work.
In your example, the contractor did carry out the work, but as it is not work that would delay completion (as completion has already occurred) then it would have no affect on the amount of liquidated damages charged. It does not matter that it would have been a Relevant Event had it been instructed before PC because it was not instructed before PC and is therefore not an event that could cause completion to be delayed.