Case update: concurrent delayNorth Midland Building Ltd v Cyden Homes Ltd[2018] EWCA Civ 1744We first reported on this case in Issue 208. NMBL and Cyden hadagreed certain bespoke amendments to the JCT Design and BuildContract 2005, one of which concerned the way in which extensionsof time would be dealt with in certain circumstances. The partieshad amended clause 2.25.1.3(b) to include the following:“3. and provided that(a) the Contractor has made reasonable and proper efforts tomitigate such delay; and(b) any delay caused by a Relevant Event which is concurrentwith another delay for which the Contractor is responsible shallnot be taken into accountthen, save where these Conditions expressly provide otherwise,the Employer shall give an extension of time by fixing such laterdate as the Completion Date for the Works or Section as hethen estimates to be fair and reasonable.”By way of a refresher, the CA provided the following definition ofconcurrency as given in the case of Adyard Abu Dhabi v SD MarineServices [2011] EWHC 848 (Comm), where Hamblen J (as he thenwas) said:“A useful working definition of concurrent delay in this contextis ‘a period of project overrun which is caused by two or moreeffective causes of delay which are of approximately equalcausative potency’ – see the article Concurrent Delay by JohnMarrin QC (2002) 18(6) Const. L.J. 436.”Indeed, the CA also noted that concurrent delay was not a conceptthat was ever considered by the courts until the late 1990’s. Herethe works were delayed, and a dispute arose between the partiesas to the proper extension of time due to the appellant, NMBL.A major element of that dispute centred on the extent to whichCyden could take clause 2.25.1.3(b) into account. At first instanceMr Justice Fraser had decided that they could. On appeal LJCoulson considered the concept of prevention. He referred to thethree principles set out in the Multiplex v Honeywell case, namelythat:“(i) Actions by the employer which are perfectly legitimateunder a construction contract may still be characterisedas prevention, if those actions cause the delay beyond thecontractual completion date.(ii) Acts of prevention by an employer do not set time at large,if the contract provides for an extension of time in respect ofthose events.(iii) Insofar as the extension of time clause is ambiguous, itshould be construed in favour of the contractor.”Note that what this case does not do, and LJ Coulson made itquite clear that this was not an issue he was considering, is to givea general statement on a contractor’s entitlement to an extensionof time in circumstances of concurrent delay. The court was solelyconsidering the bespoke concurrency clause agreed by the parties.LJ Coulson, agreeing with Mr Justice Fraser, said that:“In my view, clause 2.25.1.3(b) is unambiguous. It plainly seeksto allocate the risk of concurrent delay to the appellant. Theconsequence of the clear provision was that the parties haveagreed that, where a delay is due to the contractor, even ifthere is an equally effective cause of that delay which is theresponsibility of the employer, liability for the concurrent delayrests with the contractor, so that it will not be taken intoaccount in the calculation of any extension of time.”In light of the Judge’s conclusion, the only remaining issue waswhether there was any reason in law why effect should not be givento that clear provision. NMBL suggested, “boldly” in the words of LJCoulson, that the prevention principle was a matter of legal policywhich would operate to rescue NMBL from the clause to which ithad freely agreed. This suggestion was rejected for the followingreasons:(i) The prevention principle is not an overriding rule of publicor legal policy, like for example the rule which strikes downliquidated damages as a penalty.(ii) The prevention principle is not engaged because pursuantto clause 2.25.5, “any impediment, prevention or default,whether by act or omission, by the Employer” gave rise to aprima facie entitlement to an extension of time.(iii) The prevention principle has no obvious connection withthe separate issues that may arise from concurrent delay.(iv) Clause 2.25.1.3(b) was designed to do no more thanreverse the result in the Walter Lilly case that where delay iscaused by two or more effective causes, one of which entitlesthe contractor to an extension of time as being a relevantevent, the contractor is entitled to a full extension of time.(v) Clause 2.25.1.3(b) was an agreed term. This was the mostimportant of all.LJ Coulson noted that in the Walter Lilly case, it would havebeen open to the parties to draft “a proviso to the effect that anextension of time should be reduced if the causation criterion isestablished”, thereby allowing for a different allocation of risk. Thatwas what the parties here chose to do. The Judge said that:“A building contract is a detailed allocation of risk andreward. If the parties do not stipulate that a particular act ofprevention triggers an entitlement to an extension of time,then there will be no implied term to assist the employer andthe application of the prevention principle would mean that,on the happening of that event, time was set at large. But it isa completely different thing if the parties negotiate and agreean express provision which states that, on the happening ofa particular type of prevention (on this hypothesis, one thatcauses a concurrent delay), the risk and responsibility restswith the contractor.”Dispatch highlights some of themost important legal developmentsduring the last month, relating tothe building, engineering andenergy sectors.Dispatch – 218 – August 2018The clause here was “clear and unambiguous”. It stipulatedthat where there is a concurrent delay (properly so called), thecontractor will not be entitled to an extension of time for a periodof delay which was as much his responsibility as that of theemployer. That was an allocation of risk which the parties wereentitled to agree.Finally, it was suggested that even if clause 2.25.1.3(b) wasenforceable (so that NMBL was not entitled to an extension oftime for concurrent delay), there was an implied term whichwould prevent Cyden from levying liquidated damages. It would be“bizarre” if Cyden could recover liquidated damages for a periodof delay for which it was responsible. It could not be said that theliquidated damages flowed from a delay for which the claimantwas responsible. This suggestion was rejected for a number ofreasons. These included that if clause 2.25.1.3(b) was a valid andeffective clause then it would expressly permit the employer tolevy liquidated damages for periods of concurrent delay, because itwould not grant NMBL relief against such liability by extending thecompletion date. Finally, the Judge noted that:“I do not consider that this result is in any way uncommercialor unreal. A period of concurrent delay, properly so-called,arises because a delay has occurred for two separate reasons,one being the responsibility of the contractor and one theresponsibility of the employer. Each can argue that it would bewrong for the other to benefit from a period of delay for whichthe other is equally responsible. In Walter Lilly and the casescited there, under standard JCT extension of time clauses, ithas been found that the contractor can benefit, despite hisdefault. By clause 2.25.1.3(b), the parties sought to reversethat outcome and provided that, under this contract, theemployer should benefit, despite the act of prevention. Eitherresult may be regarded as harsh on the other party; neithercould be said to be uncommercial or unworkable.”Japanese KnotweedNetwork Rail Infrastructure Ltd v Williams & Anr[2018] EWCA Civ 1514Stephen Williams and Robin Waistell, the Respondents, both ownedhomes located in front of a Network Rail (NR) track. Behind theirhouses, the embankment was infested with Japanese knotweed,which was estimated to have been there for 50 years. Knotweedis a hardy plant similar to bamboo, which grows extremely quicklyand is renowned for its vast root structure or “rhizomes”. The plantis notorious, very invasive and requires specific treatment to removeit. A paper published in 2012 by the RICS confirmed that knotweedrhizomes have the potential to block drains; grow between slabsof concrete; disrupt brick paving; undermine garden walls; andoverwhelm poorly built outbuildings.The Respondents originally claimed that the Japanese knotweedhad become a private nuisance due to its encroachment onto theirproperties. However, at first instance, the Recorder dismissed thisclaim, holding that neither side’s experts had found any evidenceof physical damage. However, the Recorder did find NR liable dueto the disturbance of the quiet enjoyment of both Williams andWaistell. The Recorder found that since there was a risk of futuredamage and mortgage lenders would not be willing to lend onproperties where knotweed was present within seven metres,both Respondents had a claim for a loss of amenity. The Recorderdeclared that the knotweed on NR’s land had caused a loss ofenjoyment to the property and awarded damages of £10,500towards diminution of the property value and £5,000 for the cost ofremoving and disposing of the knotweed.NR appealed this decision on two grounds. The first was thatthe mere presence of knotweed on their railway embankmentcould not possibly be the cause of an actionable nuisance toneighbouring properties. Secondly, that if it had indeed encroachedonto the properties then the owners needed to prove physicaldamage had occurred to the property before NR would be liable.The Respondents replied that encroachment without physicaldamage can still lead to private nuisance and the mere presenceof knotweed within the soil should constitute damage regardless ofany physical effects.The CA said that private nuisance could often be broken downinto three categories: nuisance by encroachment, physical injury,and interference with quiet enjoyment. It is also accepted thatdamage is a quintessential requirement for a nuisance claim.However, the CA was also willing to accept that in previous casesof nuisance, damage was often an elastic value which can bedifficult to pin down. Therefore, the CA has ruled that to suggestthat the presence of knotweed in an adjoining property would notqualify as an actionable nuisance simply because it diminishedthe market value (due to lender caution) of the claimants’respective properties was wrong in principle. However, the CAdid conclude that, once encroachment has been confirmed, thiswill automatically amount to physical damage and a right tocompensation. Sir Terence Etherton MR said:“As the RICS paper observed, any improvement or alterationof the property requiring the removal of contaminated soilwould require disposal of the soil either on site or, more likely,off site by special, and probably expensive, procedures. For allthose reasons, Japanese knotweed and its rhizomes can fairlybe described, in the sense of the decided cases, as a ‘naturalhazard’. They affect the owner’s ability fully to use and enjoythe land. They are a classic example of an interference with theamenity value of the land.”This CA decision establishes that if a public body, company orfreehold owner has allowed knotweed to spread within sevenmetres then they could be held liable for their negligence. Perhapsthe biggest change is that this judgment moves the case law onfor economic loss in tort. The CA further confirmed that definitephysical damage may not be a fundamental requirement for aprivate nuisance claim. Here, simply the presence of Japaneseknotweed rhizomes was enough to cause interference with theDefendants’ quiet enjoyment of their property. As a result, bothRespondents were entitled to damages for the diminution of thevalue of their homes purely because of the presence of knotweed.For those buying or selling property, paragraph 7.8 of the TA6Property Information Form asks if your property is affected byJapanese knotweed. If a dishonest answer is given, your buyer caneither rescind the contract or claim damages equating to the lossof value of the property.02www.fenwickelliott.comDispatch is produced monthly by Fenwick Elliott LLP, the leadingspecialist construction law firm in the UK, working with clientsin the building, engineering and energy sectors throughout theworld.Dispatch is a newsletter and does not provide legal advice.Edited by Jeremy Glover, Partnerjglover@fenwickelliott.comTel: + 44 (0)20 7421 1986Fenwick Elliott LLPAldwych House71 – 91 AldwychLondon WC2B 4HN

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