REUTERS | Ilya Naymushin
REUTERS | Ilya Naymushin

On the face of it, Jefford J’s judgment in Merit Holdings Ltd v Michael J Lonsdale Ltd is a fairly typical one about payment, arising as it does, out of the construction of a new development, One Angel Court, London. However, her comments about when parties should use Part 8 for “adjudication business”, as set out in the TCC Guide, make the judgment interesting because, she says:

“… there is a real risk of the Part 8 procedure being used too liberally and inappropriately with the risks both of prejudice to one or other of the parties in the presentation of their case and of the court being asked to reach ill-formulated and ill-informed decisions.”

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The recent decision in Riva Properties Ltd v Foster + Partners Ltd, considers the duties that an architect owes to its client, specifically in the context of working in accordance with the client’s budget. Helena White and Matt Malloy have recently written about issues of contributory negligence and evidence arising out of the case. One of the most interesting aspects of the decision for me is that, over the course of a searing 313 paragraph judgment, Fraser J delivers a forceful reminder that client service is at the heart of the construction industry. Although the case specifically concerns the provision of architectural design services, it is a cautionary tale of the consequences of failing to put clients’ objectives first, which is just as relevant to lawyers, professional advisers of any specialism and indeed to all parties involved in the delivery of construction projects. Continue reading

REUTERS | Hannah McKay

Over 170 delegates attended the Adjudication Society’s annual conference in London last week to listen to speakers discuss and debate issues centring on “The users’ experience and what can be done to improve it?“.

However, the conference started with a tribute to Sir Michael Latham whose report, Constructing the Team, was so instrumental in introducing statutory adjudication in the UK. Sir Michael’s report acknowledged the adversarial attitude of the UK construction industry and identified that, while the best solution is to avoid disputes, a system of adjudication needed to be introduced. He recommended that:

“… if a dispute cannot be resolved first by the parties themselves in good faith, it is [to be] referred to the adjudicator for [a] decision.”

Therefore, it was fitting that the first session considered the collaborative and non-adversarial Conflict Avoidance Process (CAP), first introduced by Transport for London (TfL) into Costain plc’s contract for the Bond Street refurbishment and Crossrail upgrade. Continue reading

REUTERS | Denis Balibouse

On 1 May 2018 it will be 20 years since the Construction Act 1996 came into force. I think it is fair to say that, despite initial reservations by some about its introduction, most people would agree that, overall, the statutory adjudication and payment provisions have been successful. That said, like any adolescent, its teenage years have been somewhat difficult, which is mainly down to the 2011 amendments (introduced by Part 8 of the LDEDC Act 2009) to both the Act and the Scheme for Construction Contracts 1998.

Therefore, I was delighted to receive an email from a friend a couple of weeks ago letting me know that the Department for Business, Energy & Industrial Strategy (BEIS) had published a consultation on the 2011 amendments. The consultation can be accessed here and you have until 19 January 2018 to submit your thoughts.

Not only that, but the government has also published a consultation on the practice of cash retention under construction contracts (with the same January deadline). Although it is a very relevant and worthwhile consultation, it is the consultation on the 2011 amendments that I want to focus on today. Continue reading

REUTERS | Vijay Mathur

In Adam Architecture Ltd v Halsbury Homes Ltd, the Court of Appeal has confirmed that section 111 of the Construction Act 1996 (and the requirement to serve pay less notices) applies to payments due following completion or termination of a contract, as well as interim payments.

In giving the leading judgment, Jackson LJ said he reached this conclusion based on the clear words in the Act and in light of the authorities (of which, see below). Consequently, employers (and their agents) need to be alive to the need to serve a pay less notice in response to any such account if they wish to avoid the prospect of an adjudicator’s decision against them for the full amount claimed. Continue reading

REUTERS | Juan Carlos Ulate

Payment in the construction industry is regulated by the Construction Act 1996, as amended by the LDEDC Act 2009. One of the reasons behind the introduction of the Construction Act 1996 was to ease cashflow and speed up payment. However, it has to be questioned whether this aim has been achieved (and I note this is the sort of issue raised in the English consultation on the Act, which was published last week). Continue reading

REUTERS | Christian Hartmann

This is the second blog in our series on direct procurement. In this blog we consider the rise of investor interest in direct procurement projects and some of the headline legal and regulatory factors which they would do well to bear in mind before getting involved. Continue reading

REUTERS | Jacky Naegelen

Francis Bacon, The Essays:

“Read not to contradict and confute; nor to believe and take for granted; nor to find talk and discourse; but to weigh and consider. Some books are to be tasted, others to be swallowed, and some few to be chewed and digested: that is, some books are to be read only in parts, others to be read, but not curiously, and some few to be read wholly, and with diligence and attention.”

October has been a busy month, with lots of interesting developments, not least a consultation to review the Construction Act 1996 and one to review the use of retentions in the construction industry. We’re not sure if anyone else remembered the government’s promise to review the effectiveness of the changes introduced in October 2011 after five years (and it has taken them six), but it will be interesting to see the results. You have until 19 January 2018 to respond, just a few months before the Act celebrates its 20th “in force” birthday. Continue reading