PUTTING THE SCL DELAY AND

DISRUPTION PROTOCOL INTO PRACTICE

– IS IT WHAT THE INDUSTRY WANTS?

A paper based on a talk given to the

Society of Construction Law
in London on 8th June 2004

Keith Pickavance

September 2004

www.scl.org.uk
 PUTTING THE SCL DELAY AND
DISRUPTION PROTOCOL INTO PRACTICE
– IS IT WHAT THE INDUSTRY WANTS?

Keith Pickavance

Use of the Protocol

The Society of Construction Law Delay and Disruption Protocol was
published in October 2002, some two years ago.1 Since then, over 12,000
copies of it have been distributed electronically and over 1,200 hard copies
have been sold. In the United Kingdom, it is commonly referred to in
connection with construction and civil engineering procurement and in claims
and defences to claims arising out of delay and disruption in adjudications or
arbitrations. Numerous articles have been written about it and it is unusual for
it not to be the subject of discussion in construction conferences.

The guidance of the Protocol is being followed by the Hong Kong

construction industry in drafting its new standard form. Approaches have
been made to the Society for the Protocol to be translated into German and
Arabic. It is being emulated in the United States by the United States Project
Management Institute College of Scheduling.2

In the light of all this, one might reasonably be forgiven for considering it
redundant to ask: ‘Is it what the industry wants?’ Patently, it is what the
industry wants, internationally.

It is not always appreciated that there are three parts to the Protocol. The
section which appears to be most commonly referred to is Section 4. This
concerns methods of retrospective analysis available to the parties if the
recommendations of the Protocol for contemporaneous analysis of cause and
effect have not been followed during the course of the work. That section is
transparent to every form of contract, whether bespoke or standard, in all
jurisdictions.

Then the Protocol recommends the use of Time Slice analysis to demonstrate
contemporaneously entitlement to an extension of time. This guidance is
relevant to any form of contract that provides for relief from liquidated
damages for the likely effect of an excusable event on completion (if the

1 The Society of Construction Law Delay and Disruption Protocol, first published in
October 2002, reprinted March 2003, available at www.scl.org.uk (online or for
purchase).
2 Since this paper was given in June 2004, the drafting committee of the Protocol has also
been contacted by the University of Newcastle, Australia, which is carrying out research
into the possibility of incorporating the recommendations of the Protocol into the
Australian standard forms of building contract.

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contractor chooses to use it). It applies to most of the JCT forms3 and several
other forms available in the United Kingdom and some available in other
countries (but not all the standard forms).

Finally, the Protocol contains recommendations and guidance for the

contemporaneous management of the risk of change. This part of the Protocol
is not on all fours with the provisions of any of the standard forms of contract
currently available, and it cannot be put into practice without the use of the
PFE Supplements,4 or amendments of a similar scope and like kind.5

Managing the risk of change

Managing the risk of change is a serious business. When people start thinking
about construction they are almost always thinking in six figures and
sometimes in tens, or hundreds of millions of pounds. They will also usually
be thinking of using what they intend to construct for a specific purpose and
sometimes that means having to consider other time-based commitments and
often a planned financial return that must be achieved in order to justify the
expenditure.

Getting it wrong by as much as 10% can mean the difference between success
and serious failure (consider the 500% overspend on a project like the Scottish
parliament building in Edinburgh, or the legendary well publicised delays and
overspends on the British Library, the Jubilee Line tube extension, the
Docklands Light Railway, Guy’s Hospital, The Brompton Hospital, the
Millennium Dome, or Portcullis House in London). But few who embark
upon construction projects have in the past considered how they should
manage their risk, if manage it at all, except by trying to pass some of it to
others.

Delay and overspend in construction and civil engineering is not a domestic

problem: it happens all over the world. The fact that so many important public
and private projects, internationally, have consistently run late and
significantly over budget demonstrates that risk transference simply does not
work. Why does it not work? It does not work because under no
commercially realistic form of construction contract can the risk of change be
borne by the contractor when the employer is the only one empowered to
make the change. And delay, disruption and overspend are inevitable when all
the risk of change is borne by the employer but the only party given the tools

3 Standard forms of building contract published by The Joint Contracts Tribunal Ltd.
4 The Pickavance Consulting/Fenwick Elliott jointly conceived change management JCT
contract Supplements to assist with implementation of the Protocol. Printed copies of the
Supplements, suitable for incorporation into construction contracts and the Practice Notes
accompanying them, are available from RIBA Bookshops or by electronic order from the
RIBA Bookshop, Fenwick Elliott solicitors or Pickavance Consulting; specimens can also
be downloaded free of charge from www.pickavbance.net.
5 The provisions of the Engineering and Construction Contract (published by the Institution
of Civil Engineers) are consistent with the recommendations of the SCL Protocol so far as
they go. They provide for the contractor to warn the employer from time to time of what
his risk is but on the whole, he has no redress if the provisions are not followed. It also
omits to provide the employer with any significant control over the management of his
risk.

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to manage that risk is the contractor, who is also promised that he will receive
more time and more money when those risks are not managed. But that is the
administrative framework contained in the standard forms of contract.

So long as the employer relies on the right to vary the works he must carry the
liability for any change so ordered; that applies irrespective of whether the
contract is build only, turnkey, design and build, the one stop shop,
management contracting, EPC, partnering or even if the contract has that
wonderfully reassuring title of ‘guaranteed maximum price’.

Typically, apart from voluntary instructions to implement design changes, the

employer will also take the risk in relation to instructions that have to be
given:
• to correct an ambiguity or discrepancy in his requirements;
• to correct an error in description (or quantity) in the bills, specifications
or drawings;
• to suspend the carrying out of the works;
• to avoid a legal or physical impossibility;
• to rectify any loss or damage arising from any of the insured risks;
• to ensure conformity with any statute or regulation;
• to investigate or dispose of archaeological findings;
• to uncover or make openings in works where the works are found to
have been carried out in accordance with the contract.

Generally, apart from the risk associated with voluntary or compulsory

instructions, the employer will also be required to take the risk of a number of
other contingencies, including:
• force majeure;
• exceptionally adverse weather;
• a failure of the design team to issue in due time any information,
drawings details or instructions (and under some forms, that risk is not
dependant upon whether such information is ever requested);
• civil commotion, strike or lock out;
• the discovery of unforeseeable ground conditions;
• a failure to respond within due time to a contractor’s submittal;
• the occurrence of an insured risk;
• a failure to obtain any permission necessary for the development;
• a failure to give, or deferment of possession of, or access to, or egress
from any part of the site;
• the default of a nominated subcontractor or nominated supplier;
• the execution of work, or supply of materials, or goods by others;
• a change in the law;
• the exercise of a statutory power that affects the supply or use of labour,
plant, or materials;

3
• the contractor’s unforeseen inability to obtain the labour or materials he
needs;
• the execution of work under a statutory obligation;
• the use of, or threat of the use of terrorism;
• compliance with, or non-compliance with the CDM Regulations;6
• a failure to make prompt payment.

It is of little use to the employer to be told that one of those events has
adversely affected progress when it is too late to do anything about it or, even
if there is an opportunity, in the absence of the power to do anything to
manage the risk of the likely delay to completion that will otherwise follow.

If he is to be able to manage those risks he has constantly to know what the

contractor intends to do, in what sequence he intends to achieve his aim, when
he intends to execute particular activities, what resources he intends to use and
how the contractor’s progress matches his intent. He also needs to know what
other permutations are possible and the cost and time implications of any
change to the contractor’s intent.

Changes in practice not reflected in contracts

In the days before we used expressions like IT, managing the employer’s risks
under a construction contract, except by benevolent intuition, was difficult if
not impossible. In those days the employer depended on the contractor for
everything. Construction processes were much less complex then. They were
less mechanised and they employed less expensive construction techniques.
The process was conducted less intensively because there was nothing much
that could be done about managing change. Dispute resolution was also much
less sophisticated. In those days, few construction disputes were resolved by
the formal resolution procedures that are now employed in most projects at
some stage.

Anyone who was in the construction industry 40 years ago, when critical path
programming techniques were first used commercially, can reflect on the days
when drawings were still being produced with indian-ink pens on starched
linen. They can reflect on the way the work was managed in the days before
photocopiers, mobile phones and spreadsheets were available. Building and
civil engineering is now immensely more sophisticated and expensive,
executed very much more intensively and we have small, portable, networked
high speed computers, multiple access databases, fast internet connections, e-
mail and, of course, specialists in the advocacy of construction disputes. So
much has changed.

On the other hand, very little has changed in the way the standard forms of
contract envisage the management of the risks in a construction contract.
Take for example, the new JCT Major Projects Form.7 This is a form that is

6 The Construction (Design and Management) Regulations 1996, regarding health and
safety on site.
7 Major Project Form, The Joint Contracts Tribunal Ltd, 2003.

4
recommended for large scale projects that can reasonably be expected to be
conceived many years before the contractor may start on site and, because it is
a ‘major project’, can be expected to take many years to build. All this is to
proceed in a technological environment that is changing by the day. But look
at it. The administrative infrastructure envisaged by this form is no different
from that posed by JCT ’98,8 a form written before the Protocol was
published, no different from JCT ’80,9 a form written before the desk top
computer was invented, no different from that posed by JCT ’63,10 which was
written before critical path networks had been discovered, and no different
from the RIBA 1931 form.11 If ever there was an accident waiting to happen
this must be it.

Change is inevitable. It is fatuous to suggest that it can be avoided, or that it is

unnecessary, or uneconomical, or unwieldy to facilitate the management of the
risk of it within the contractual framework. We now live in a different society
than that envisaged by the administrative structure of any of the standard
forms currently available. The fact is that the improvements in technology
have made it now both possible and eminently sensible for contractors to
manage the construction process more professionally than they have ever been
able to before, and for the employers to take a structured and disciplined
approach to the management of their own risks of change.

With the good practice guidance now available through the Protocol and the
tools of the PFE Supplements, the employer and his consultants can manage
change contemporaneously. And, if they do not, in my submission they have
only themselves to blame for the cost and time overruns and the energy-
sapping enquiries and disputes that inevitably will follow.

Does the industry want to put the Protocol into practice? In my submission, it
does. It wants it in the broadest sense, and it wants it internationally.

Keith Pickavance LLB(Hons), DipArch, DipICArb, RIBA, FAE,

FCIoB is chairman of Pickavance Consulting Limited (London and Hong
Kong), specialising in the resolution of disputes involving delay in
construction and civil engineering contracts as expert, adjudicator and
arbitrator; he is also the author of Delay and Disruption in Construction
Contracts, 2nd edition, LLP, 2000.

© Keith Pickavance and the Society of Construction Law 2004.

The views expressed by the author in this paper are his alone, and do not necessarily
represent the views of the Society of Construction Law or the editor, neither of whom
can accept any liability in respect of any use to which this paper or the information in
it may be put, whether arising through negligence or otherwise.

8 Standard Form of Building Contract, The Joint Contracts Tribunal Ltd, 1998 edition.
9 Standard Form of Building Contract, Joint Contracts Tribunal, 1980 edition.
10 Standard Form of Building Contract, Joint Contracts Tribunal, 1963 edition.
11 In 1903, the RIBA published a standard form of building contract; in 1931 the RIBA
formed the Joint Contracts Tribunal and published the 1931 form, although the contracts
were not referred to as JCT forms until 1977.

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 ‘The object of the Society
is to promote the study and understanding of
construction law amongst all those involved
in the construction industry’

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