With the current impact of the Coronavirus what are the contractual implications if work on site is delayed through it impacting the contractor supply chain?
Much has been written about ‘prevention events’ and whether work is impacted such that it is not reasonably possible to complete on time.
However, for any contracts entered into prior to the outbreak and that include secondary option X2 then you should notify a compensation event. In response to the COVID-19 outbreak, the United Kingdom Parliament enacted a Statutory Instrument; The Health Protection (Coronavirus) Regulations 2020.
These Regulations came into force at 06:50 am on 10 February 2020 and provide for the imposition of restrictions and requirements, as directed or instructed by the Secretary of State, or a named role which includes a ‘registered public health consultant’, who is a registered medical official engaged by Public Health England.
The Regulations also provide details on screening requirements and the detention or isolation of persons suspected to be infected with the virus.
The matter is a compensation event although the affects are reasonably unknown at this stage, although that would be an issue for the Project Manager to consider and respond to appropriately, so should not prevent a notification from being made.
It is also possible that the Employer / Client may prevent access to the Site or the PM could give an instruction to ‘postpone’ the works under clause 34, if the situation ‘demands’ such an action., both of which would likely be a compensation event.
Where work is delayed on Site which could delay Completion or a Key Date then you are obliged to give an early warning by notifying of this appropriately. Whatever the outcome, however, keep and maintain documentation to provide a contemporaneous record of what has happened.