Construction delay claims are notoriously complex, particularly when determining responsibility for concurrent delays. The Ontario Superior Court provided new direction for assessing concurrent delay in its January 18, 2021 decision in Schindler Elevator Corporation v. Walsh Construction Company of Canada (2021 ONSC 283).[1]
This case arose out of the construction of a new hospital in downtown Toronto by a partnership between Walsh Construction Company of Canada and Bondfield Construction Company Limited ("WBP") for the Women's College Hospital Capital Redevelopment Project (the "Project"). Schindler Elevator Corporation ("Schindler") was hired as the elevator subcontractor.
Schindler brought a claim for unpaid services and materials against WPB for approximately $1 million. In response, WBP counterclaimed for approximately $2.2 million, mostly for damages flowing from a delay allegedly caused by Schindler. WBP also argued that other (concurrent) delays were caused during the same time period by a number of other subcontractors, and that Schindler was liable for its share of the delay damages.
To recover from Schindler, WPB had to establish that Schindler was responsible for a delay that caused WPB's losses. In cases of concurrent delay, this is a complicated exercise in determining the delay, breaking the delay down into its various parts, assessing each part's particulars in terms of time and costs, and assigning responsibility for each part to a project participant. This exercise typically involves expert opinion evidence.
In this case, Schinder's expert testified that concurrent delay involves to co-critical and co-controlling activities occurring at the same time (i.e. for a concurrent delay to occur there must be a complete coincidence of duration).
The Court rejected this approach, determining that the independent causes of delay need not occur at exactly the same time. Such a requirement would make concurrent delay a rare phenomenon. Given the multiplicity of actors on construction projects, all with overlapping and interlocking roles in furthering the overall project, such a rigid doctrine would fail to adequately apportion responsibility for the losses resulting from concurrent delay. Instead, the law recognizes the practicality that concurrent delays are often overlapping events that need not begin and end at exactly the same time. The Court empathized that this approach would better ensure that the losses arising from delays are fairly distributed among the various project participants.
In this case, the Court found that Schindler's performance of its subcontract was delayed, resulting in some damages to WPB, but that Schindler's delay did not result in a material delay to the Project as a whole. As such, much of WBP's counterclaim was unsuccessful.
More importantly, the Court's decision provides direction on the definition of 'concurrent delay' and indicates that a practical approach, acknowledging the complexity of construction projects, must be taken when assessing concurrent delay and apportioning responsibility for the losses arising from same.