JM Keynes, The End of Laissez-Faire:
“The important thing for Government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things that at present are not done at all.”
Last month we were still awaiting an effective date for the Construction Act 1996 changes. Now we know that 1 October 2011 is D-day in England and Wales, and 1 November in Scotland. We also know about the changes to the Scheme for Construction Contracts 1998 (and its Scottish equivalent), with three different versions (for England, Wales and Scotland). At least there is consistency in the Exclusion Order that each country has published, but yes, we have three of those too.
It may feel like the Construction Act 1996 changes have dominated life at PLC Construction in July, with all our coverage of the changes, updating all of our maintained resources, and publishing some new ones (like this note on adjudication under the Scheme before and after the changes, a payment mechanism flowchart and an Ask the team blog post on preparing your team for the changes). However, we haven’t been resting on our laurels or neglecting other areas. For example, we published a new form of agreement for use with NEC3, and our NEC3 Z clauses and notes on negotiating JCT insurance provisions were updated.
There had been a paucity of adjudication enforcement judgments in recent months, but the TCC has once again swung into action and we have reported judgments on:
- An adjudicator’s apparent bias in issuing a preliminary views document (Lanes v Galliford Try).
- Recovering an adjudicator’s costs and the reasonableness of his fee (Fenice v Jerram Falkus).
- Alleged breaches of the rules of natural justice (Hyder Consulting v Carillion).
- An adjudicator’s apparent bias and without prejudice material (Ellis v Goldstein).
Not content with one TCC judgment in a month, the parties in the Fenice v Jerram Falkus dispute were back in court again, with Coulson J’s lengthy judgment in Jerram Falkus v Fenice considering contractual conclusivity provisions, prevention and concurrent delay. Not to be outdone, Ramsey J handed down an even longer judgment in Harrison v Shepherd Homes, touching on a developer’s liability under sales contracts, consumer protection, the Defective Premises Act 1972 and NHBC cover.
The courts have also been looking at issues including contractual duties of good faith, bespoke limitation clauses, whether advance payment guarantees are performance bonds, the Latent Damage Act 1986, estoppel and indemnities and whether a side letter was an agreement to agree. The Supreme Court was also busy, overturning the Court of Appeal’s decision in Jivraj v Hashwani. We prepared a six-month case review too.
We’ve had opinions on the European Commission (EC) consultation on improving concession contracts, the Court of Appeal decision in McIlroy v Quinn, the danger of industry fragmentation to health and safety, the changes to the Scheme for Construction Contracts, the meaning of “hold harmless” and the nature of an indemnity, Harooni v Rustins, equity principles, health and safety lessons for businesses and RICS’ contracts in use survey.
On the public procurement front, the courts have ruled that a procurement challenge was brought out of time, lifted an automatic suspension and struck out an ineffectiveness claim. The government has set out its plans for education funding, begun a consultation on capital investment for schools, outlined its priority school building programme and HM Treasury has published guidance on making savings in PFI contracts. PLC has considered what risks arise from abandoning a public procurment process and the EC continues to address modernising public procurement policy, with a Cabinet Office response already published.
PLC has also reported on the timetable for the Equator Principles, the HSE’s consultation on cost recovery following inspections, HMRC’s unfair penalty notice policy under the Construction Industry Scheme, “allowable solutions” for zero carbon new homes and the EC’s consultation on the sustainable competitiveness of the construction sector.
Finally, a second company has been charged with corporate manslaughter.