Monthly Archives: May 2021

REUTERS | Siphiwe Sibeko
May 26, 2021

Termination – where did it all go wrong?

Is it just me who has seen a lot of disputes regarding wrongful termination since the beginning of the COVID-19 pandemic? A large proportion of those disputes have concerned whether a party has terminated in accordance with the provisions in a JCT contract. While parties frequently attempt to exercise termination provisions under JCT contracts, very few seem to do so effectively.

The termination provisions in JCT contracts are not to be taken lightly. There are a number of potential pitfalls for both employers and contractors.  Continue reading →

REUTERS | Yves Herman
May 25, 2021

Recovery of an adjudicator’s fees

As much as I love dispute resolving, whether that is adjudicating, arbitrating or mediating, this is not an altruistic endeavour of mine and, just like everyone else, one of the objectives is to be rewarded financially as a return on the investment of the time devoted to the process.

I’m sure I’m not alone in saying that I would prefer not to have to take steps to recover fees incurred by the parties. Therefore, I understand fully where the adjudicator in Davies & Davies Associates Ltd v Steve Ward Services (UK) Ltd was coming from when he sued for his unpaid fees.

It is a case that gave rise to a number of interesting points as you’ll discover if you read on.  Continue reading →

REUTERS | Denis Balibouse
May 19, 2021

Can you exclude or limit liability for a deliberate breach of contract?

The short answer to this question is yes. But matters become slightly more complicated when considering how this can be done.

In Mott MacDonald Ltd v Trant Engineering Ltd, the claimant (MM), an engineering contractor, brought a claim for alleged non-payment of its fees by the defendant (Trant) for the provision of design consultancy services in relation to the construction of a power station in the Falkland Islands. Trant raised a substantial counterclaim, alleging that MM had:

“… positively and deliberately refused to perform its obligations and had done so in order to put improper pressure on [Trant] to pay sums which were not due to [MM].”

MM denied any such breaches but contended that, in any event, the exclusion and limitation clauses in the parties’ agreement would operate to exclude or limit its liability, irrespective of whether Trant could establish that such breaches were fundamental, wilful or deliberate. MM applied for summary judgment on this point. Continue reading →

REUTERS | Toby Melville
May 18, 2021

Recent COVID-19 related force majeure decisions: what do they mean for construction contracts?

Roughly a year has passed since the COVID-19 lockdowns were implemented. Despite much upheaval, project delays, and supply chain issues, it appears that projects across the globe may finally be getting back a sense of normality. To this day, however, much uncertainty remains for project owners, contractors and sub-contractors regarding how COVID-19 will affect their legal rights under contract. Specifically, it remains unclear how courts and tribunals around the world will treat the pandemic for the purposes of force majeure provisions because so little judicial opinion has been proffered.  Continue reading →

REUTERS | Lucy Nicholson
May 17, 2021

Are DABs the new adjudication?

The JCT Dispute Adjudication Board Documentation 2021 (JCT DAB) has now been published, for use with the 2016 Design and Build Contract (DB) and the Major Project Construction Contract (MP). But, before we look at how it will operate, it is worth stepping back and looking at what dispute boards are meant to do and why they are now seen as an option for UK projects. Continue reading →

REUTERS | Michael Dalder
May 11, 2021

The perils of multiple agreements on the same project

It strikes me that there are a number of factual scenarios that commonly lead to jurisdictional challenges when disputes come to adjudication. One example is where the contract concerns a residential occupier. There will often be jurisdictional challenges even if the contract in question expressly provides for adjudication, as we can see from the mountain of case law on the topic. Another obvious example is where part or all of the contract is said to comprise excluded construction operations under section 105(2) of the Construction Act 1996. Millions of pounds in legal costs have been wasted over the years arguing about these exclusions and, as I have said on a number of occasions (most recently in March 2020), it is high time we put these exclusions into Room 101.

A less obvious example is where parties enter into multiple agreements concerning the same project. We’ve seen a number of cases over the years where the question has arisen as to whether they were variations to a single contract, or multiple contracts, the issue being that an adjudicator cannot decide disputes under different contracts in the same adjudication. Indeed, I blogged on just such a case earlier this year.

The case I want to discuss this week, Delta Fabrications & Glazing Ltd v Watkin Jones & Son Ltd, also involves multiple contracts but comes with a twist in that the parties agreed they had entered into two separate sub-contracts. So how, I hear you saying to yourselves, did the referring party consider that the adjudicator had jurisdiction to decide the dispute? Continue reading →

REUTERS |
May 5, 2021

How will the new UK residential property developer tax work?

On 29 April 2021, the government published a consultation on what is to be called the Residential Property Developer Tax (or RPDT). This sets out proposals for the design of a new tax to be charged on the largest residential property developers.

The plan is for the tax to be introduced from April 2022 (through inclusion in the 2021 Autumn Finance Bill) and to raise at least £2 billion. Such funds will contribute to the cost of cladding remediation work.

Plans for this tax were first mooted in February as part of a £5 billion cladding remediation package. However, details of what was planned were sketchy at best and so it is pleasing that the consultation setting out further detail of the parameters of the tax has been so swiftly published.

This post takes a look at the consultation starting with a recap of why such a tax has been introduced. It then looks at what is being proposed, timelines for introduction and what will happen next.  Continue reading →

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