“An event that is at the Contractor’s risk under the contract (a “Contractor Risk Event”) will result in five weeks delay to completion, delaying the contract completion date from 21 January to 25 February. Independently and a few weeks later, a variation is instructed on behalf of the Employer which, in the absence of the preceding Contractor Risk Event, would result in delay to completion from 1 February to 14 February.”
7.1 Is the Contractor entitled to an extension of time in respect of the variation? If so, for how long?
Assuming that the contract contains an extension of time clause entitling the contractor to an extension of time for variations and that it does not contain any provisions governing the treatment of concurrent delay – the position in this situation under English law is currently unclear.
One line of cases suggests that if the Contractor Risk Event and the variation are of “approximately equal causative potency” then the Contractor should be entitled to an extension of time for the delay caused by the variation (see for example Walter Lilly & Co Ltd v Mackay  EWHC 1773). On that basis the Contractor would be entitled to an extension of time of 2 weeks (for the period 1 – 14 February).
Another line of cases takes a “first in time” approach which means that the event that occurs second is not regarded as an effective cause of delay (because the works were already in delay and the second event did not increase that delay) and does not entitle the Contractor to an extension of time (see for example Adyard Abu Dhabi v SD Marine Services  EWHC 848 and Saga Cruises BDF Ltd v Fincantieri SPA  EWHC 1875; this is also the position espoused in the Society of Construction Law’s Protocol). On that basis the Contractor would not be entitled to an extension of time.
Yet a third line of cases takes a more liberal approach and would allow an extension of time where the Employer’s variation would have caused a delay to completion in the absence of or “but for” any Contractor Risk Events (see for example, De Beers v Atos Origin IT Services UK Ltd  EWHC 3276 (TCC)). This line of cases presently appears to be less prominent than the other two noted above, but there is as yet no authoritative guidance from the English Court of Appeal as to which is correct.
One point which does appear to be reasonably settled on the English cases is that a partial extension of time apportioned across the two causes of delay is not permissible. This was the position reached by the Scottish Court of Appeal (known as the Inner House of the Court of Session) in City Inn Ltd v Shepherd Construction Ltd  BLR 473, but has been consistently rejected in the English cases.
7.2 Assuming the Contractor is contractually entitled in principle to recover delay-related costs relating to the variation, for what period (if any) could it recover those delay-related costs?
As noted above, absent any specific contractual provision to the contrary it is generally thought that a contractor would not be able to recover additional costs attributable to the period of concurrent delay as it would not be able to show that “but for” the occurrence of the event that in principle entitles it to additional payment it would not have incurred those costs. As a result the Contractor would not be entitled to recover delay-related costs relating to the variation.