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THE PREVENTION PRINCIPLE AFTER NORTH MIDLAND V CYDEN HOMES: TIME FOR CHANGE?

International Construction Law Review

THE PREVENTION PRINCIPLE AFTER NORTH MIDLAND V CYDEN HOMES : TIME FOR CHANGE? Max Twivy “The principle is of some antiquity and has a surprising effect on the contractual obligations as to the time for completion.” 1 In the recent case of North Midland Building Ltd v Cyden Homes Ltd , the Court of Appeal considered the prevention principle. 2 The prevention principle provides that an employer cannot hold a contractor to the contractual completion date if the Employer has itself prevented the Contractor from completing the works by that date. In those circumstances: time is set at large; the Contractor is obliged to complete within a “reasonable time”; and the Employer loses its right to claim liquidated damages for delay. 3 This paper first summarises the current law on the prevention principle. It then addresses three issues thrown up by Cyden Homes : the juridical basis of the principle; the relationship between extension of time provisions and the prevention principle; and the prevention principle in cases of concurrent delay. The paper concludes by suggesting that the effect of setting time at large is an antiquated consequence of applying the prevention principle. It proposes a reform of the law which would enable the prevention principle to continue to give effect to its fundamental purpose whilst better respecting the doctrine of freedom of contract. 1. THE PREVENTION PRINCIPLE TODAY The nature and effect of the prevention principle was summarised by Jackson J in Multiplex v Honeywell : 4 “The essence of the prevention principle is that the promisee cannot insist upon the performance of an obligation which he has prevented the promisor from performing. In the field of construction law, one consequence of the prevention principle is that the Employer cannot hold the Contractor to a specified completion date, if the Employer has by act or omission prevented the Contractor from completing by that 1 Bluewater Energy Services BV v Mercon Steel Structures BV (QBD (TCC)) [2014] EWHC 2132 (TCC), paragraph 518 (Ramsey J); 155 Con LR 85. 2 North Midland Building Ltd v Cyden Homes Ltd (CA) [2018] EWCA Civ 1744; [2018] BLR 565 ; 180 Con LR 1. 3 For the remedies that the prevention principle can provide to a contractor, see: Magintharan S., “The prevention principle and the Contractor’s remedies” (2017) 33(8) Construction Law Journal 455–489. 4 Multiplex Constructions (UK) Ltd v Honeywell Control Systems Ltd (No 2) (QBD (TCC)) [2007] EWHC 447 (TCC); [2007] BLR 195 , paragraphs 47–48; 111 Con LR 78. 376

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