International Construction Law Review
CAN A CONTRACTOR RECOVER WHEN TIME-BARRED?
BRIAN K CLAYTON
Associate, Clifford Chance, London*
I. INTRODUCTION
The purpose of this paper is to consider, in Australian law, a contractor’s ability to recover where it is time-barred from recovering under the construction contract.
This paper has, broadly, two parts. The first examines case law on time stipulation clauses in a construction context. It will be seen from this examination that time stipulation clauses in a construction context are often construed as time bars. The second part examines the various heads that may enable a contractor to recover where it is time-barred.
II. SYNOPSIS
Time stipulation clauses1
are a common feature of construction contracts in Australia.
Where the procedural requirements of a time stipulation clause are a condition precedent to an entitlement of the contractor, the contractor’s entitlement will be destroyed if it fails to adhere to the procedural requirements (within the time limit). In other words, the contractor will be time-barred from recovering.2
The financial ramifications of being time-barred—such as being unable to claim for additional work or an increased exposure to liquidated damages—can be very severe for the contractor. Accordingly, a significant amount of case law has developed on whether various time stipulation clauses are a time bar or simply a time frame (in the sense that failing to comply with a mere time frame does not bar recovery).
Courts have readily construed time stipulation clauses to be time bars in construction cases, particularly in the context of extensions of time and variations—to the detriment of contractors. Some of the important conclusions from those cases include3
:
* This article is based on a paper submitted by the author for the Masters of Construction Law, University of Melbourne, Australia.
1 Which are defined, for the purposes of this paper, in Section III, below.
2 For more detail, see Section III, below.
3 The relevant cases are discussed in Section III, below.
[2005
The International Construction Law Review
342