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Time Bars in Construction

Introduction


Construction projects are challenging tasks that frequently involve numerous parties, intricate contracts, and strict deadlines. Time-related problems and delays can give rise to disputes that can have serious financial and legal repercussions. The idea of time bars has become more popular in England as a way to effectively manage and settle such disputes.


CostPro often get questioned on the strict application of time bars and how the approach has been developed by the English courts. This article aims to provide an overview of the process and a summary of the most important cases involving time bars in English construction law.



The History of Time Bars


The need for establishing precise deadlines for filing claims and disputes gave rise to the idea of time bars in the field of construction law. Time bars are clauses in contracts that require parties to notify potential claims within a certain timeframe, failing which they may be prohibited from pursuing those claims in the future. These clauses encourage prompt dispute resolution, prevent unjustified delays, and offer assurance for building projects.


Leading Law on Time Bar Interpretation


The interpretation and application of time bars in construction law have been further shaped by a number of significant cases. There are many, but CostPro consider the following as important milestones:


The Ankar Principle and the Amending Act

  • Ankar Property Investments Ltd v. Tsai Ming (Hong Kong) Enterprise Ltd [1980]

The Ankar case is one of the landmark decisions that influenced how time bars are applied in England. It established the rule that a condition precedent requiring the service of notices prior to claims must be strictly followed, regardless of the merit of the claim. The claim may become time-barred if such provisions are not followed.


  • The Housing Grants, Construction, and Regeneration Act of 1996

This Act made changes to construction law, placing a stronger emphasis on the significance of time Bars. The Act required the inclusion of particular dispute resolution procedures in construction contracts, such as the giving of notices and the strict observance of deadlines.


  • Carillion Construction Ltd v. Devonport Royal Dockyard Ltd [2005]:

This case established that time bar provisions should be strictly interpreted, focusing on the precise language used in the contract. Parties must adhere to the established procedures and deadlines, otherwise their claims may be time-barred.


  • Multiplex Construction (UK) Ltd v. Honeywell Control Systems Ltd [2007]

The court emphasised that time bars can only be avoided through precise and unambiguous language. To maintain the right to claim, a notice requirement that is a condition precedent must be strictly followed.


  • Obrascon Huarte Lain SA v Her Majesty’s Attorney General for Gibraltar [2014]

In this case the judge upheld the obligation of adhering strictly to time bars. That being said, some more context was provided to when notice periods commence.


Considerations and Implications for Daily Life


All parties involved in construction projects must consider the significant effects of time-bars.

To safeguard their rights, contractors and subcontractors must be careful to understand and abide by the contractual notice requirements. Employers and their agents should make sure that deadlines are precise, unambiguous, and realistically attainable.


The above listed law has over time been reflected in the most widely used standard forms of contracts;

  • The FIDIC contracts (1999 and 2017 editions) provide that if a claiming party does not give a notice of claim within 28 days of becoming aware of the event or circumstances giving rise to the claim…; and

  • The NEC contracts (2013 [NEC3] and 2017 [NEC4] editions) provide that if a contractor does not give a notice of claim within eight weeks of becoming aware of the eventthey shall lose all entitlement (and relief) in respect of that claim.


Conclusion


In England, time limits have become a fundamental component of construction law, resulting in effective dispute resolution and guaranteeing that parties follow established deadlines.

The importance of strictly adhering to contractual notice provisions has consistently been emphasized by the leading case law on time bars.


CostPro advise that contractors and subcontractors adhere strictly and unequivocally to any deadlines stated in the Contract. To protect their rights, parties must be aware of their time-related responsibilities, and if in doubt seek any necessary commercial advice required.


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