Claims Under ACA 3 - Building Contract Claims - page 381

This appears to be the correct interpretation to be put upon 'default' in
clause 7, and this was reinforced by Greater London Council v. The Cleveland
Bridge & Engineering Co. Ltd 647 , which emphasised that 'default' is a
narrower term than breach of contract. However, when considering the
wording of a bond, the Court of Appeal in Perar BV v. General Surety &
Guarantee Co Ltd 648 held that 'default' did not mean anything other than a
breach which was its common meaning and the meaning to be derived from
the context of the bond and the reference to damages. Therefore, in this
contract, the precise meaning remains open.
This is not to suggest, of course, that it is easy to establish a claim under
the clause, and it is important to note that the contractor must be able to
show that he 'suffers or incurs damage, loss and/or expense' in consequence
of the disruption or delay occasioned by the employer's (or architect's) act,
omission, etc. The damage, loss and/or expense must have been caused by
the breach and not merely be the occasion for it 649 .
In other words, the loss, etc. must follow directly and in the natural course
of things from the event that gives rise to it; and the event giving rise to the
claim is the 'act, omission, default or negligence of the employer or of the
architect' resulting in delay or disruption.
There is a further limitation, because the disruption or delay must be
referable to the dates stated in the time schedule. The time schedule is thus
the yardstick against which delays and disruption are to be measured. The
time schedule is a feature peculiar to ACA 3, although similar in some
respects to the abstract of particulars under Form GC/Works/1(1998). It is
described by the ACA as 'an essential part of the ACA Form of Agreement'.
The time schedule is a contract document and is not the same as the
contractor's programme.
The time schedule is printed at the back of the form of agreement, and is
in two alternative versions, one providing for normal single completion and
the other for sectional completion. For ordinary completion, it contains the
following information:
. date for possession (clause 11.1);
. taking-over and commencement of maintenance period ('Taking-Over' is
described by the ACA as 'similar to ''practical completion'' which has
been described as ''when the building is reasonably safe and not unrea-
sonably inconvenient'' '. This, of course, is not the definition of practical
completion favoured by the courts.);
. weekly rate of liquidated damages (clause 11.3). If a daily rate is required
the necessary amendments must be made to the wording. (This item is,
however, to be deleted where the employer wishes to exercise his option
647 (1987) 8 Con LR 30.
648 (1994) 66 BLR 72. In this case, the court declined to follow Northwood Development Company Ltd v.
Aegon Insurance Company (UK) Ltd (1994) 10 Const LJ 157, which held that 'default' was wider in
meaning than 'breach' and included non-fulfilment of the contractor's obligation under the contract,
whether or not the contractor was in breach.
649 Weld-Blundell v. Stephens [1920] AC 956.