Law and regulation of concurrent delay in Poland

Jurisdiction without developed jurisprudence

1. Is concurrent delay a well developed and understood concept?

Concurrent delay is not a well-developed or understood concept in Poland.

2. Is there a generally understood and accepted definition of concurrent delay and when it arises?

There is no definition of concurrent delay in Polish law or in Polish case law.

3. How is the issue of concurrent delay treated?

Under Polish law there are no statutory rules for delay and/or allocating risks and responsibilities to the parties in the event of concurrent delay. There is also no established case law dealing with concurrent delay. Potential claims of the parties relating to concurrent delay are dealt with according to the rules for defective performance/non-performance and for compensation of damages relating thereto.

The general rule under Polish law is that damages are due only if the delay is culpable. Therefore, unless the contract provides otherwise, the contractor can only claim costs of the extended performance of the contract from the employer if the extension was caused by the employer’s fault. 

At the same time, in a judgment of 27 September 2013 (I CSK 748/12) the Supreme Court stated that contractual penalties imposed on the contractor after a delay caused by the employer are not acceptable for being in conflict with the principle that a debtor cannot be in delay if the creditor is in delay.

Therefore, if the contract provides for contractual penalties for delay, in the situation where the delay was caused by both, the employer and the contractor, the contractor will not pay contractual penalties for delay but will also not be able to claim the costs of the extension from the employer (depending on the employer’s contribution to the contractor’s delay in performing the work). 

Delay might be caused by both the employer and contractor where the contractor has delayed in performing the works and the employer has delayed in co-operating with the contractor, especially handing-over the construction site, providing permits required to perform the works, informing about circumstances impacting the course of the works, etc. or other circumstances delaying the works caused by the employer (e.g. instructed variations). 

Therefore, a delay caused by both the employer and the contractor would be a delay in performance of the works for which the contractor is partially liable as the delay was caused also, to the certain extent by the employer e.g. by delay in handing-over the construction site to the contractor. Consequently, the employer’s delay must be at least one of the reasons (must contribute) to the contractor’s delay in performing the works. Depending on the extent of such contribution the contractor may be still liable towards the employer for delay damages (if the employer’s breach of the contract was minor and did not significantly contribute to the contractor’s delay).

4. Are there any general principles that apply to the treatment of concurrent delay?

In Polish law there are no general principles that apply to the treatment of concurrent delay. In particular, there is no rule according to which the contractor would automatically get an extension of time for any period of concurrent delay. There are no causes of delay for which statutory rules or case law exist.

The contractor’s claims for additional payment for periods of concurrent delay are to be assessed pursuant to the general rules for defective performance/non-performance described in point 3 above. Moreover, an entitlement for additional costs requires that such costs can be directly allocated to a certain cause (requirement of causal link).

5. How is the question of evidence as to causes and periods of delay dealt with?

Polish law does not provide for any specific rules for evidence as to causes and/or periods of delay. In particular, there are no officially accepted methods of analysis. The general rules provided for in the Polish Civil Procedure Code (the “CPC”) apply. 

Usually each of the parties will hire a programming expert/delay analyst to prepare a so-called private expert opinion, who has his/her preferred method of analysis out of a number of possible methods. At the same time, in the light of the CPC such opinion is treated as any other private document and does not have the same evidentiary value as the court expert opinion. Therefore, in court proceedings in most of the cases a court expert opinion will also be prepared.

6. Would a contract term which provides that one or other party will take the risk of concurrent delay be effective in your jurisdiction?

Under Polish law the debtor may assume by contract the liability for the non-performance or improper performance of the obligation due to specified circumstances for which he is not liable by virtue of statutory law. This includes taking the risk of concurrent delay.
At the same time, according to the case law and legal doctrine, in order for such extension of liability to be effective, the parties should expressly and unequivocally indicate the circumstances for which the debtor is to be liable.

7. The SCL Protocol scenario

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?

Due to lack of statutory regulations and the case law concerning the concurrent delay it is difficult to assess whether and to what extent the contractor would be entitled for additional time under the presented circumstances. However, if the works covered by the variation are not on the critical path along with the works delayed by the contractor’s risk event, then the delay due to the contractor’s risk event would occur anyway, regardless whether any variation is instructed. Under such assumption most probably the contractor would not be entitled to any extension for the variation’s works period, since with the variation or without the variation the delay would be the same. If, on the other hand, such dependence was existing, then the contractor could claim that employer has partially contributed to the contractor’s delay because the variation disrupted performing the (already delayed) works. However, it is difficult to assess the exact number of days of such prolongation (the maximum would be the period of the variation’s works i.e. 14 days).

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?

The Contractor could only recover delay-related costs to the extent that it was entitled to an extension of time as discussed above (and assuming that the contract provides for a basis for recovery of delay-related costs).