In the construction industry, claims for disruption can be raised in circumstances where the smooth implementation of projects is affected by disruptive events, even if that disruption does not impact on the timely completion of works.
In essence, disruption is a reduction in productivity for which a contractor is not responsible. Restricted or piecemeal site access, out of sequence working and late provision of instructions are all examples of disruptive events which may occur.
Disruptive events usually lead to other problems which further adversely affect productivity on site, such as the crowding of labour, idle labour, and stacking of trades.
Whilst a reduction in productivity may lead to delay in the progress of the works and it is not unusual for claims for delay and disruption to be brought together, a disruption claim is distinguishable from a delay claim.
The purpose of a disruption claim is to recover additional costs incurred, or the losses suffered, as a result of a disruptive event. It is possible for work to be disrupted and for the works still to complete on time. In such instances, a contractor will not have a claim for an extension of time or loss and expense but it may have a claim for the cost of the reduced efficiency of its workforce and additional costs incurred.
Disruption claims are not for time-related costs and should only include additional task-related costs resulting from the loss of productivity caused by the disruptive event. Disruption claims may fall under categories such as wasted expenditure, additional costs of labour or plant, and unproductive management time.
A contractor considering bringing a disruption claim in England and Wales should first refer to the High Court's guidance set out in the case of Walter Lilly v Mackay to determine whether there is any basis for a disruption claim to be made. In that case, the court advised that in order to succeed in bringing a disruption claim, a contractor has to demonstrate on a balance of probabilities that:
Whilst there is no set way to prepare such a claim and it is open to a contractor to determine how best to provide a reasonable assessment of the disruption caused, the following issues are likely to be determinative: