Winning Construction Delay Disputes in Bahrain: A Case Study Approach
Construction delay disputes are among the most common and costly conflicts in Bahrain’s building and infrastructure sector. They can lead to significant financial losses, missed deadlines, and strained relationships between project stakeholders.
Successfully resolving these disputes requires a strong legal strategy, detailed evidence, and a clear understanding of contractual obligations. In this blog, we present a general, illustrative case study showing how a delay dispute can be handled effectively, without referencing any specific firm or actual incident.
Understanding Construction Delay Disputes
Delays in construction projects typically fall into three categories:
- Excusable Delays — caused by events outside the contractor’s control (e.g., force majeure, design changes, regulatory delays).
- Non-Excusable Delays — caused by the contractor’s own actions or inefficiency.
- Concurrent Delays — where both the contractor and employer contribute to the delay.
The resolution depends heavily on contract terms, documented evidence, and timely legal action.
The Legal Foundation
Under Bahraini law and standard FIDIC-based contracts:
- Delays must be properly notified to the other party within the time frame stated in the contract.
- The party seeking compensation must provide proof of the delay, its cause, and its financial impact.
- Dispute resolution may occur through negotiation, mediation, arbitration, or litigation.
Case Study: Resolving a Construction Delay Dispute
Project: High-rise commercial building in Manama
Value: BD 8 million
Issue: 120-day project delay and liquidated damages claim of BD 600,000
Background:
A contractor was engaged to construct a commercial tower under a FIDIC-based contract. Halfway through the project, several design changes were requested by the project owner, affecting the HVAC system and structural elements. The contractor claimed these changes caused significant delays and requested an extension of time (EOT) along with additional payment.
The owner rejected the claim, stating that the contractor failed to follow the proper variation and notification procedures under the contract. The owner then imposed liquidated damages for late completion.
Legal Strategy Applied:
- Contract Review: A lawyer reviewed the contract to assess the variation and EOT clauses.
- Evidence Gathering: The contractor’s project records, correspondence, site instructions, and updated schedules were compiled.
- Delay Analysis: An independent delay analysis was conducted to separate the time impact caused by the owner’s changes from the contractor’s own delays.
- Formal Notice: A structured legal notice was sent to the owner, challenging the liquidated damages and presenting the delay analysis.
- Negotiation & Mediation: The lawyer facilitated mediation, presenting the evidence that most of the delay was attributable to approved design changes.
Outcome:
The owner agreed to:
- Withdraw the majority of the liquidated damages claim
- Grant a 90-day extension of time
- Pay partial compensation for additional costs
The dispute was resolved without going to arbitration, saving time and further expense for both parties.
Key Lessons for Avoiding and Winning Delay Disputes
- Follow Contract Procedures — Always issue formal notices for delays or variations within the specified timeframe.
- Document Everything — Keep detailed records of instructions, approvals, and site progress.
- Use Independent Delay Experts — Technical analysis strengthens legal arguments.
- Engage Legal Support Early — The earlier legal advice is sought, the greater the chance of a favorable outcome.
- Consider Alternative Dispute Resolution (ADR) — Negotiation or mediation can be faster and less expensive than arbitration or court.