Typically, when a party breaches a construction contract to the extent that it causes delay, the non-breaching party is able to claim damages for loss, this was affirmed in the recent case of Lucas Earthmovers Pty Limited v Anglogold Ashanti Australia Limited [2019] FCA 1049. The Court considered how a ‘no damages for delay’ clause must be constructed in order to be valid in the circumstances where a contractor claims damages for delay or disruption where an employer is culpable. The case involved Lucas Earthmovers (‘the Contractor’) and AGA (‘the Owners’) who were involved in a construction project that was delayed, with the Contractor incurring additional costs for completion. In bringing an action against the Owner, the Contractor claimed damages for: time related costs for additional work, variations under the contract and consequences of the additional time and additional work completed. The Federal court held that the ‘no damages for delay’ clause (clause 18.8) that stipulated that the Contractor will not be entitled to claim any Liabilities resulting from any delay or disruption (even if caused by an act, default or omission of the Company or the Company’s Personnel (not being employed by the Contractor)” prevented the Contractor from claiming costs for prolongation. This indicates that although there is uncertainty as to whether the Courts would enforce such clauses due to their exclusionary nature, it is also equally possible that the Court will accept their enforceability.

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