Managing extreme weather-related delay and disruption claims on projects

A growing number of "freak" weather events, such as record temperatures, rainfall and wind speeds are leading to wildfires, heatwaves, floods and tropical storms. These typically constitute "acts of God" in force majeure clauses and allow contractors to claim extensions of time (and potentially additional costs) to the extent that these phenomena critically delay the works.

However, such events are often just hot, wet or windy days and not usually acts of God giving rise to an extension of time entitlement. Nevertheless, if weather conditions were so out of the ordinary that the contractor could not reasonably have foreseen them and they adversely affected progress of the works, the contractor may still have a right to claim under general "unforeseeable event" wording in a force majeure definition.

Notwithstanding the current good practice of reporting weather conditions, temperatures and rainfall in daily progress reports to help substantiate claims, it is essential to follow the contractual process for submitting claims and to collect evidence of the actual impact on the project. Therefore, when making claims arising out of extreme weather conditions (or receiving claims, in which case, establish that the following have been complied with and whether any stages omitted before rejecting claims), ensure to:

1. Read the contract carefully. Contracts allocate adverse weather risk differently. For example, FIDIC Red and Yellow 1999 and 2017 entitle a contractor to an extension of time for delays due to "exceptionally adverse climatic conditions" and may allow the contractor to recover prolongation costs, whereas both editions of FIDIC Silver remove this ground and make recovery of such costs unlikely (although exceptionally adverse climatic conditions may still fall within FIDIC Silver's generic force majeure wording).
2. Check relied upon information, employer's requirements or other tender documents regarding local or expected weather conditions. Are the actual weather conditions in line with or outside those parameters? If any assumed conditions are different from the actual conditions, the contractor may be entitled to a variation/change order, as well as an extension of time for force majeure.
3. Take measurements, evidence and visual records at all relevant work fronts showing how the works are affected; for example, wind measurements where scaffolding is erected (to demonstrate that it would be unsafe to work in such winds) or photographs of standing water on access roads preventing deliveries or movements around site. If workers are underground or in enclosed spaces, measure temperatures at those work fronts, not just in the site office.
4. Use historical data to demonstrate conditions were extreme. Follow any contractually-specified methods for determining extreme weather (for example, the 10-year average monthly temperature or the average number of days with more than 5mm of rainfall). Where none are in the contract and no internal method was used during contract tendering, the FIDIC Guide's advice, which suggests using weather data for a period of four to five times the length of the contract, is recommended. For example, for a contract with three years of works, obtain monthly averages (and monthly highs and lows) from the 12 to 15 years before contract signing and demonstrate that the actual weather conditions were outside these. If they are outside historical averages but part of a widely reported trend of (for example) rising summer temperatures in the project location, those receiving claims may be able to use press reports or similar to argue successfully that, although the weather may have been extreme, it was not unforeseeable.
5. Assess the criticality of activities affected. Where work stops completely, it is simple to assert that there has been a critical delay. However, if some works cease but others continue, make an assessment against the latest available programme as to whether the affected works are on the critical path (which may entitle the contractor to bring a delay claim) or not (which may permit a disruption or idle time claim).
6. Comply with notice provisions in the contract. Check the requirements and submit notices in the specified timeframe, clearly labelling them as contractual notices. Some contracts may require more than one notification requirement to be met, as do the unamended FIDIC 1999 contracts, where Sub-Clauses 19.2 and 20.1 both apply to force majeure claims. If there are conflicting notice provisions for force majeure claims and contractor claims, comply with the most stringent.
7. Update the programme to demonstrate critical delay. For extension of time claims, update the logic-linked project programme to show the impact of the delay (that is, the late completion of the impacted critical activity) and the effect on provisional acceptance or practical completion.
8. Collect cost information. Ensure claims for additional costs are explained and evidenced. Examples of reasonable costs would include direct costs spent on mitigation measures (such as cooling packs or water pumps), disruption costs as a result of stop-start working patterns, and prolongation costs for critical delay.
9. Submit a fully detailed claim within the contractually-stated timeframe, if required by the contract, along with the impacted programme, and cost information and evidence. This fully detailed claim typically triggers the requirement for an employer or contract administrator to decide the claim, so take care to submit it following the initial claim notification.

Authored by Tom Smith, Lee Wake, and Mark Crossley.