A sub-contract without an
agreed programme is built on “shifting sand”
Most standard sub-contracts for use with JCT forms require
the sub-contractor to carry out his
work in accordance with the details set out in the tender or sub-contract
appendix and “reasonably in accordance with the progress of the main contract
works". If the appendix refers to
a specific programme, the sub-contractor will be contractually bound to perform
in accordance with that programme.
The sub-contractor must try to get an agreed programme incorporated
by reference within this original agreement. The next best thing is to refer to
the sub-contract requirements as set down within the original main contract
programme. The full title, date and
reference number of the programme must be quoted. Vague allusions to "the main contract (or sub-contract)
programme" are of little help.
Many main contractors prefer
to treat the sub-contractor as a totally flexible resource. They will insert terms such as "work in accordance with the contractor's
instructions" or " to suit main contract progress”. There is case law which emphasises that any sub-contractor who accepts such terms agrees to be delayed and disrupted without reimbursement.
If the sub-contractor has managed to get a detailed programme
incorporated in his documents, then that programme must be carefully retained,
since it is "the contractual baseline" for monitoring delays, extensions of time, loss and expense
etc.
Where the original documents mention no specific programme, then
the sub-contractor must improve the
situation by obtaining the main contractor's requirements and
submitting/agreeing a detailed sub-contract programme before work
commences. This must be confirmed in writing to the main
contractor (ie title, date and programme number). The covering letter should
emphasise that this represents the original sub-contract programme as
agreed between the parties. Remember,
a sub-contract without an agreed
programme is built on “shifting sand”.
A sub-contractor who takes a job on the basis of a "period of
time" with no programme details could be placed in an onerous position,
since he has no baseline against which to demonstrate his case for extension of
time and/or financial reimbursement.
Having achieved a “baseline” programme, any significant changes may
well bring entitlement to compensation in time and money. This must not be taken to extremes, since the sub-contractor must always use his
"best endeavours". However,
this obligation is not thought to involve substantial additional
expenditure.
The main contractor may
propose, prior to commencement,
that the sub-contractor should work to a "target programme" of
reduced duration. The sub-contractor can either treat the proposal as an
"acceleration" and submit a price for negotiation, or he can
co-operate on the basis of "goodwill".
In either case, it is
essential that the "ground rules" are clearly agreed and
confirmed. I have seen sub-contractors
levied with "delay costs" because they failed to achieve a
"target programme". If
co-operating, then state in writing that your co-operation, and the status of
the "target programme" is on the basis of "best endeavours"
and is "without prejudice" to your contractual entitlements. If involved in acceleration, agree a price
before you start.
The architect usually has no contractual responsibility to supply
information to the main contractor to suit the requirements of an “early
finish” programme. In so far as some of
this information is required for the sub-contractor, then the problems are
obvious.
Where the sub-contractor has been signed up on a "target
period" from the outset (ie based upon the main contractor's hopes of
completing in less than the overall main contract terms allow), then the
sub-contractor's obligations and entitlements are governed by this agreed sub-contract
period. Whether or not the main
contractor gets an extension of time etc is, probably irrelevant.
How else is a sub-contractor to prove his entitlements in respect
of delay, disturbance, extension of time and financial reimbursement than by
reference to a programme of some kind?
Providing the programme can be shown to have been agreed by the parties
in writing, and providing that it corresponds with the sub-contract period and
dates as set out in the original
agreement, then an arbitrator would, it is submitted, be unlikely to dismiss that programme as "irrelevant".
In essence, my advice to the sub-contractor is :
· Try to get a programme
agreed and incorporated in the original agreement.
· If not, try to get one agreed in writing as soon as possible, and
to establish same as "the baseline
programme".
· Retain it in a safe place, as it represents how you started out to
tackle the job
· Identify and record the issue and receipt of all revised programmes.
· "Keep an eye" on the main contract progress, and its
relevance to sub-contract progress.
· At all times, ask yourself "Is this what the estimator priced
to do?"
John Russell
Contracts and
Training Consultant
Cheshire CW4 7DP
Tel: 07770 986444
Email: swsubbie@globalnet.co.uk
Back to Jack Russell Column Contents