Calvin Coolidge, 30th President of the USA (attributed):
“Nothing is easier than spending the public money. It does not appear to belong to anybody. The temptation is overwhelming to bestow it on somebody.”
March saw the Government deliver its (final?) Budget. As there was little in the Budget for the construction industry, the reaction to it was muted.
March was also a busy month elsewhere in the construction and engineering world: the draft revised Scheme has finally landed! In other words, the consultation on the proposed amendments to the Scheme for Construction Contracts 1998 was published this month. If they become law, the amendments will affect both adjudication and payment under construction contracts. The amendments follow the changes introduced by Part 8 of the LDEDC Act 2009. They have been eagerly awaited and, if you want to respond, you have until 18 June 2010 to do so.
In adjudication, the TCC granted an injunction preventing the claimants from pursuing three adjudications against the defendant. In other adjudication enforcement cases, the courts held that:
- The adjudicator had jurisdiction even though there was no construction contract “in writing”.
- The employer’s fraud allegations should be rejected.
- The adjudicator had jurisdiction and did not breach the rules of natural justice.
- The defendant’s application to stay enforcement proceedings should be rejected.
A number of other issues were also under the courts’ spotlight, including:
- Pay-when-paid clauses (they didn’t apply to the employer’s insolvency).
- Remoteness of damage (the damages were foreseeable).
- The meaning of “subject to contract” (the agreement still came into effect).
- Assignment of an indemnity clause (it could be assigned).
- Whether the developer fraudulently misrepresented the position to prospective tenants (it didn’t).
- Whether a drop in prices frustrated a contract (it didn’t).
The OGC has published guidance on a number of public procurement issues, including time limits for challenge, joint venture arrangements between the public/private sectors; exclusion of economic operators; and publishing contract awards. Time limits were also before the courts in Northern Ireland and Scotland.