REUTERS | Bogdan Cristel
August 3, 2021

When is a collateral warranty a “construction contract”?

Or should that be, when is a collateral warranty not a construction contract?

July was a busy month for TCC judgments, which makes the job of writing these blogs considerably easier. In addition to the fascinating judicial review cases being brought by the Good Law Project, one case that caught my eye was Timberbrook Ltd v Grant Leisure Group Ltd because it concerned the construction of a new orangutan enclosure at Blackpool Zoo. However, it is quite a detailed, merits-based judgment and, in the end, I plumped for the only TCC judgment (at least of those on BAILII) that concerned adjudication, Toppan Holdings Ltd and Abbey Healthcare (Mill Hill) Ltd v Simply Construct (UK) LLP.

It is an interesting judgment by Martin Bowdery QC, sitting as a deputy High Court judge, not least because two decisions (from the same adjudicator) were dealt with in the same enforcement proceedings.

Continue reading →

REUTERS | Kacper Pempel
July 28, 2021

Third time lucky: Supreme Court allows recovery of liquidated damages in Triple Point v PTT

Those you of you with an interest in construction law will no doubt have heard of the case of Triple Point v PTT, which concerned whether liquidated damages (LDs) are payable in the event of termination.

The first judgment was given by Jefford J in 2017 and the Court of Appeal gave judgment on the appeal in 2019. The final decision by the Supreme Court has been long awaited… and we now have the answer to one of the trickier questions of construction law. Continue reading →

REUTERS | Darren Whiteside
July 27, 2021

Building safety: gateway two levy

The eagerly awaited consultation on the new building safety levy (Levy) and its possible impact on housing supply and regeneration was published on 21 July 2021. It runs for 12 weeks, ending on 15 October 2021.

The new Levy, first announced by Robert Jenrick MP in February 2021, will be introduced through regulations (yet to be published) made under powers in the Building Safety Bill 2021-2022 (Bill). It is expected to come into force in 2023 (subject to the passage of the Bill through Parliament) alongside the “gateway two” stage of the new building safety regime and will be paid to the Secretary of State (or designated body) to help fund the government’s building safety expenditure (such as the removal of unsafe cladding).

This Levy is in addition to the residential property tax, which is the subject of a separate consultation, and is expected to be introduced in 2022 and which will apply to the largest residential property developers to also support the government’s cladding remediation costs. Continue reading →

REUTERS | Ricardo Moraes
July 21, 2021

Stays of execution in adjudication enforcement: when are the merits of the underlying claim relevant?

The starting point, and usually the end point, in construction adjudication is that the court will enforce an adjudicator’s decision however plainly wrong their decision was. That is, of course, unless they lacked jurisdiction to reach their decision or materially breached the rules of natural justice. That was Parliament’s intention when it enacted the Construction Act 1996 and every construction lawyer is familiar with the tenet.

Predictably, one might think, there has been an ever-growing body of cases in which defendants, with no defence to enforcement, seek to stay execution under CPR 83.7(4) (formerly RSC Order 47).

This begs the question: when are the merits of the underlying claim relevant to an application to stay execution in adjudication enforcement proceedings? Continue reading →

REUTERS | Mike Hutchings
July 20, 2021

Ireland finally has its Macob moment

Only last week, I was part of a CIArb panel discussing 25 years of adjudication or, to be more accurate, 25 years of the Construction Act 1996. As we all know, the Act really only started to bite sometime in 1998 (because it only applied to contracts entered into after 1 May 1998), but it was a little while longer before we saw the first adjudication enforcement case (Macob Civil Engineering Ltd v Morrison Construction Ltd), which was heard by Dyson J, who was the Judge in Charge of the TCC at the time.

Macob laid the foundations for what we all now take for granted when it comes to adjudication enforcement and the support the process gets from the courts, whether that is in the TCC or all the way up to the Supreme Court. As Nicholas Gould said, everyone was waiting for someone to go first.

I guess you could say it set the ball rolling and now Ireland has its own Macob to set the enforcement ball rolling there following the judgment in Principal Construction Ltd v Beneavin Contractors Ltd. Continue reading →

REUTERS | Hannibal Hanschke
July 13, 2021

Proposed changes to the Defective Premises Act

Many changes have been introduced since Grenfell to address the cladding crisis including the establishment of various loans, funds, plans for new regulators, new taxes, levies and new rules to govern building safety throughout the lifetime of a building.

Last weekend, news broke of the latest initiative: extending the limitation period for homeowners to claim compensation for defective work under the Defective Premises Act 1972 (DPA) from 6 to 15 years, and extending the application of the DPA. The proposed changes are set out in the Building Safety Bill.

This blog takes a closer look at the proposed changes. Continue reading →

REUTERS | Jorge Silva
July 6, 2021

TCC stays expert determination proceedings

It has been quite some time since I have blogged about expert determination. In fact, the last time was six years ago when I wrote about the Court of Appeal’s judgment in Begum v Hossain, which concerned the valuation of shares in an Indian restaurant. That was before the term “Brexit” had been coined and most of us were happily oblivious to the meaning of the word “furlough”. Therefore, Jefford J’s recent judgment in Maypole Dock v Catalyst Housing Ltd, which concerned an interim injunction to restrain the pursuit of an expert determination, caught my eye.  Continue reading →

REUTERS | Max Rossi
July 5, 2021

Cranes on the horizon: construction disputes in Russia

This post is part of a series covering issues that frequently arise in construction law disputes, each with a specific regional focus. This post addresses issues in Russia.

The Russian construction sector has experienced significant activity in recent years. The COVID-19 pandemic has resulted in a projected contraction of the construction industry in Russia by 3.8% in 2020 (as opposed to the 2.6% growth expected prior to the virus outbreak). However, the Russian government remains focused on continuing with infrastructure works, as President Putin confirmed in April 2020, when he urged senior government and business officials to “adhere to infrastructure project schedules as closely as possible”.

Russian parties seldom make use of internationally recognised standard forms (such as the FIDIC suite of contracts), as such forms usually are not compliant with Russian law and so require major redrafting. Instead, tailored contractual documents compliant with the provisions of (for example) the Civil Code of the Russian Federation (Russian Civil Code) are much more common.

This post considers two important restrictions under the Russian Civil Code, affecting an employer’s ability to vary the scope and/or value of works and a contractor’s/sub-contractor’s ability to recover sums in excess of the agreed contract price for the performance of additional works. Continue reading →

REUTERS | Tobias Schwarz
June 29, 2021

Too much of a good thing: serial adjudication, multiple disputes and NEC

Adjudication has now become the default dispute resolution method for construction disputes, to the extent that some parties use it on multiple occasions and for multiple disputes. But that carries its own risks and complexities, as highlighted in the recent decision in Prater Ltd v John Sisk and Son (Holdings) Ltd.

This decision concerns the NEC3 Engineering and Construction Subcontract (ECS), and highlights the issues that come up with serial adjudication, as well as the need to take further steps beyond just issuing a notice of dissatisfaction under Option W2 and how the courts view the issue of whether more than one dispute can be referred to adjudication under that clause. Continue reading →

REUTERS | Lucy Nicholson
June 24, 2021

Interpretation of alleged inconsistencies between bespoke terms and standard forms

Last month, the Court of Appeal handed down its judgment in Septo Trading Inc v Tintrade Ltd.  While the case does not change the law, it provides a helpful outline as to the approach to be taken to interpreting alleged inconsistencies between bespoke terms and the terms of standard forms within a given contract. The case will be of general interest to practitioners, in particular those whose practice incorporates construction or shipping work, where standard forms are commonplace. Continue reading →