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Variation after practical completion? Do I have to carry it out?

construction law and dispute resolution

Variation after practical completion? Do I have to carry it out?

Variations provide a valuable tool to all parties to a project. It will rarely be possible to design and construct a project so that nothing alters from start to finish. In fact, in our experience this is almost never the case. Often a project is not fully designed before work commences, so variations provide a valuable means for allowing design development to be fluid as a project progresses.

As procurement methods and preferences have changed, so too has the need for variations. Traditional lump sum fixed price contracts were often too linear in their construction and design and as such variations were infrequent. As times have changed and the use of the design and build and turnkey projects has become prevalent, variations have become more frequent. When managed well they are a useful tool to give the employer the development he requires while maintaining momentum on the project, and whilst the contractor will undoubtedly expect to carry out variations throughout the contract duration, what is the position in terms of instructed variation after practical completion?

This is a question that many contractors and subcontractors often ask us, as once practical completion has been achieved the imposition of having to carry out specific ‘piece meal’ type variations is more often than not a troublesome hindrance, so does the contractor have to carry out the variation?

In a nutshell, no.

Once practical completion has been achieved, it is often more convenient to have the contractor available to carry out extra work during the defects period, this may be for example to rectify a design fault or some other matter.

In many instances this may however be inconvenient for the contractor and they may have no desire to carry out additional work, especially if the work is small in nature and the time frame is oppressive.

On the other hand, the contractor is familiar with the project and one would think that this would make them the most suitable organisation to carry out any last minute instructions or variations.

Once practical completion has been achieved, the contractor has no obligation to carry out varied work, although an exception would be where the contract expressly provides for issued variation after practical completion.

Hudson’s Building and Engineering Contracts stated the following in regards to MM Price Ltd v Milner (1968) that:

“Variations as well as original contract work cannot be instructed after practical completion of the remainder of the work in the absence of express provision, unless of course the contractor is willing to carry them out…”

In summary the contractor is not obliged to carry out variations where the instruction is issued after practical completion unless there is a clause in the contract which gives the requisite power to issue an instruction of this nature.

So next time you are asked to quickly build a new tarmac ramp, with wooden gates and fence as one of our clients was recently asked following practical completion, please bear in mind that sometimes a simple “No thank you” may well suffice.

 

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