If the Architect/Engineer issues a variation after the extended completion date but before practical

completion, can an extension of time be granted or will liquidated damages become unenforceable?
The case, Balfour Beatty Building Ltd -v- Chestermount Properties Ltd (1993)
heard before Mr Justice Colman of the commercial court, arose out of an appeal against an award of
Christopher Willis, a well known and respected arbitrator and deals with the subject matter in
question.
1) The works employing JCT 80 comprised the construction of the shell and core of an office block.
Work commenced on 18 September 1987, the completion date being 17 April 1989, later extended to
9 May 1989. As work was not completed by this date a certificate of non-completion was issued by the
Architect under clause 24.1. By January 1990 the work had still not been completed.

2) During the period 12 February 1990 to 12 July 1990 the Architect issued instructions for the
carrying out of fit out works as a variation to the contract. Practical completion of the shell and core
was achieved on 12 October 1990 with the fit out works not finished until 25 February 1991. The
Architect issued two extensions of time to give a revised completion date of 24 November 1989. The
variations with regard to the fit out works were issued after the revised completion date but prior to
practical completion, during a period of default. The Architect then revised the non-completion
certificate to reflect the extended completion date. ,

3) The contractor argued that 'the effect of the issue of variations during a period of culpable delay
was to render time at large, leaving the contractor to complete within a reasonable time. This being
the case, the Employer would lose his rights to levy liquidated damages.

Alternatively, the contractor contended that the Architect should have granted an extension of time on
a gross basis. In this case it was argued that the fit out work should have taken 54 weeks, this period
to be added to 12 February 1990, when the fit out variation was issued.

4) It was the Employer's contention that the correct approach should be a net extension of time, that
is to say, one which calculated the revised completion date by taking the date currently fixed for
completion and adding to it the 18 weeks that the Architect considered to be fair and reasonable for
the fit out work.

5) The main plank in support of the contractor's argument was that jf the net method was adopted
the extended completion date would expire before the variation giving rise to the extension had been
instructed, which was logically and physically impossible. If the contractor's line were followed it would
provide him with a windfall which swept up his delays. While recognizing this, the contractor
considered the problem resulted from the Employer's own voluntary conduct in requiring a variation
during a period of culpable delay.

6) Mr Justice Colman did not agree. He found in favor of the Employer for the following reasons:
When the Architect reviews extension of time under clause 25.3.3.2 following practical completion
he is entitled to reduce the extended contract period to take account of omissions. These may have
been issued during a period of culpable delay. It would therefore, be illogical for the Architect to have
to deal with additions differently to the way he deals with omissions.
The objective of clause 25.3.1 is for the Architect to assess whether any of the relevant events
have caused a delay and if so by how much. He must then apply the result of his assessment to give a
revised completion date. It would need clear words in the contract to allow the Architect to depart
from a requirement to postpone the completion date by the period of delay caused by the relevant
event.

The final nail in the contractor's coffin came when Mr Justice Colman said:
"...in the case of a variation which increases the works, the fair and reasonable adjustment required to
be made to the period for completion may involve movement of this completion date to a point in time
which may fall before the issue of the variation instruction".
7) This decision is unlikely to apply to ICE 6th and 7th Editions where under clause 47(6) liquidated
damages are suspended during a period of delay resulting from variations, a clause 12 situation, or
any other delaying event outside the control of the contractor.
Summary:
where an Architect/Engineer issues a variation after the contract completion date but before practical
completion, it is appropriate where resultant delays occur for an extension of time to be granted. Such
extension of time will be calculated by extending the completion date by the net period of delay. This
is unlikely to apply to ICE 6th and 7th Editions which provides for the suspension of liquidated
damages during a period of delay caused by variations and the like.