Practical Law

You don’t have to be an avid reader of specialist construction magazines to know that the quality of new build housing is a big issue at the moment. Both the national press and social media are awash with stories (often sensationalised) of defects, cracks, subsidence, fire safety issues and all manner of other problems. The … Continue reading Crumbling edifices (again) – defective new homes and the “insurance” problem →

What is the reverse charge? Coming into effect on 1 October 2019, the reverse charge in relation to building and construction services is set to bring about a major change in how VAT is handled in the construction sector. All those involved – including developers – need to be aware of when it will apply … Continue reading VAT reverse charge →

In the beginning… Happy birthday, Practical Law Construction! A lot has changed in the ten years since the “blog page” came into being. In October 2008 we were living in St Albans, our son was still at school and Labour were in power. Lehman Brothers had recently collapsed and the global financial crisis was in … Continue reading Practical Law Construction: 10 years a blogging →

The trouble with collateral warranties (CWs) is that they aren’t very interesting. Construction lawyers typically overdose on them as trainees and have had enough of them by the time they qualify. A brief foray into the world of third party rights and they are ready to move on to higher things, leaving the following cohort … Continue reading Making collateral warranties interesting: the Office Depot case →

1 October 2019 will see a significant shake-up of the VAT rules in the construction sector. New rules will come into force on that date which will, in many cases, require the recipient of the supply of construction services, rather than the supplier, to account for VAT on the supply. Large and small businesses making … Continue reading The reverse charge: shaking up VAT on construction services →

My colleague, Natalie Wardle, commented on the Supreme Court’s decision in Gard Marine and Energy Ltd v China National Chartering Company Ltd in her May 2017 blog. As she noted, the judgments (and the 3:2 majority verdict) left a number of questions unanswered. Two of these were: What is the strength of the implied term that … Continue reading Co-insurance and subrogation rights revisited (again!) →

I read the decision in Ziggurat with some incredulity. I hadn’t intended to trespass on Karen Spencer’s territory, and overall I’d agree with her conclusion that the amendments made to the ABI form seem to have confused rather than clarified matters. I’d also agree with Roddy Cormack’s comment that more radical surgery is needed if … Continue reading Ziggurat: the crumbling edifice of surety bonds →

The Supreme Court’s decision in MT Højgaard A/S v E.On Climate and Renewables UK Robin Rigg East Ltd has spawned a predictable welter of case notes and commentaries. Legal luminaries have analysed Lord Neuberger’s judgment from a variety of angles, noting that the contractor (Højgaard) was held to be under a “double obligation” to comply with … Continue reading Losing the sympathy vote: Robin Rigg revisited →

It is hard to believe that the CIC Consultants’ Contract was published nearly 10 years ago. Having been involved in its gestation, I am only too keenly aware of the compromises that were needed to create a form that was acceptable to the CIC’s constituent bodies, while also (mainly) meeting the needs of commercial developers … Continue reading ACE professional services agreement: does the house of cards stack up? →

It was only to be expected. Hard on the heels of FAC-1 (the framework alliance contract published by the Association of Consultant Architects, the group responsible for PPC2000) comes a guidance note from the NEC brigade, issued in liaison with the Infrastructure Client Group. It patiently explains that NEC3 offers an “ideal” (translation: “better than … Continue reading A brave new world? Implementing “alliancing” using NEC3 →

The recent wave of major infrastructure projects in London has produced a number of collateral benefits. Key among these has been the opportunity it has afforded to leading clients to focus on the legacy impact of their projects for the industry as a whole. Enlightened leaders such as David Higgins and John Armitt (Olympic Delivery … Continue reading Leaving a legacy: the rise of ethical sourcing →

They say that hard cases make bad law, and Manor Asset Ltd v Demolition Services Ltd is certainly a hard case. The nice folks at Practical Law Construction knew that I would have an opinion on it (they know me too well!) and have asked me to share my thoughts with you. I know that … Continue reading Pay less notices: confusion at the Manor →

In my experience, one of the most common causes of construction disputes is conflict or ambiguity between contractual documents. This is perhaps hardly surprising, since they are often prepared by different members of the client’s team. Yet it can easily be avoided if the client is willing to invest a little time and effort (and … Continue reading Design defects in offshore wind turbines: it’s an ill wind… →

The practice of novating design consultants is now a ubiquitous feature of design and build (D&B) contracts in the UK. Over the last 20 years or so, informed by decisions such as Blyth & Blyth Ltd v Carillion Construction Ltd, the wording of novation agreements has evolved to the stage of a largely market standard … Continue reading Design dilemmas in D&B →

I can’t believe that it is nearly five years since I blogged on the Langstane case. Time obviously flies when you’re getting old. For those of you with short memories or with youth on your side, in Langstane a Scottish judge held (among other things) that a net contribution clause (NCC) in a consultant’s appointment … Continue reading Net contribution: a problem shared? →

After nearly 30 years in the construction law game, I should no longer be surprised when an unexpected decision comes along. But Akenhead J’s judgment in Parkwood Leisure Ltd v Laing O’Rourke Wales & West Ltd made me sit up and draw breath. Last week’s Practical Law legal update notes that the decision will be a “surprise … Continue reading Collateral warranties and the Construction Act – a nasty surprise →

I am always nervous when contracts that I had a hand in drafting end up in the High Court. Thankfully it hasn’t happened too often, but when it does there is an inevitable frisson as I wonder what the judge will make of it. Will he agree that my drafting means what I intended it … Continue reading Rainy Sky revisited – common sense in the TCC →

I was pleasantly surprised to see a few fellow lawyers at the RICS recently, for the launch of its New Rules of Measurement (NRM) and the accompanying QS & Construction Standards (the Black Book). I had thought this was classic “QS’ing for QSs” territory and that I was the only lawyer sad enough to be … Continue reading The new RICS measurement rules →

Keen readers of this column will recall my bafflement at the Court of Appeal’s decision in Rainy Sky SA v Kookmin Bank. An (as it seemed) routine call on an advance payment bond was denied on the basis of one word – “such“. The word had been carelessly inserted into a clause of the bond, presumably with … Continue reading Common sense prevails in the Supreme Court: Rainy Sky →

Few expressions are more likely to get construction practitioners hot under the collar than “fitness for purpose”. But is the hype justified? And what does it really mean? I was pondering these questions when recently reviewing a client’s in-house (bespoke) form of design and build contract.

For anyone who (like me) is going through the ordeal of domestic building work, the tale of Michael Phillips Architects Ltd v Riklin and another has a painful resonance.

When I first read the Court of Appeal’s decision in Kookmin Bank v Rainy Sky SA, I couldn’t believe it. Surely I had misunderstood the facts? So I read it again, and everything was as I had thought. Was I missing something?

Working on a major infrastructure project recently, I was reminded of the issues that can arise when dealing with contractors undertaking projects on a joint venture (JV) basis. This is an increasingly common approach on large and complex projects (particularly in the roads, tunnelling and power sectors) as contractors look to pool their expertise or … Continue reading Contracting with joint ventures →

In last week’s post I explained the format and purpose of the JCT’s Project Bank Account documentation (PBA) and pointed out problems with its trust provisions. This week I consider the PBA’s provisions for payment into the project account.

The adoption of Project Bank Accounts (PBAs) is one of the key elements in the Office of Government Commerce’s (OGC) drive to promote fair payment practices in the construction industry. So, with the draftsmen of the JCT, NEC and PPC2000 contracts vying for the prize of most OGC-compliant standard form, it comes as no surprise … Continue reading JCT Project Bank Account documentation: do the trust provisions work? →

In my previous post, I outlined the facts in Langstane Housing Association Ltd v Riverside Construction Aberdeen Ltd and considered the judge’s surprising decision on the meaning of “current” when deciding which version of the ACE conditions applied. In this post I look at the judge’s analysis of the net contribution clause in the ACE … Continue reading Net contribution clauses and UCTA →

The decision in Langstane Housing Association Ltd v Riverside Construction Aberdeen Ltd features some highly dubious judicial reasoning and illustrates the extent to which the courts are out of touch with the real world of contract negotiations for major construction projects. Although a Scottish case, its findings will resonate in England and Wales as well.

Construction companies are complex businesses. Typically, a construction company will have entered into numerous contractual arrangements with a range of clients, sub-contractors and suppliers, as well as ancillary undertakings such as bonds, guarantees and collateral warranties. There will be a mix of ongoing and completed contracts, with potential liabilities extending for up to 12 years after … Continue reading Selling a construction company →

Everyone involved in construction and engineering appreciates the effort involved in planning a project and choosing an appropriate procurement strategy. All too often that work is undermined by careless errors made when compiling the contract documents into a formal agreement. The resulting disputes can be expensive and time-consuming. Here are some tips for avoiding trouble: