What’s Wrong with Retention?

Blog Author: Peter Hibberd Retentions meet a real need and aren’t a problem in themselves – it’s how they are administered that needs fixing The clarion call for no retention has persisted for many years and has once more initiated action. This time BEIS undertook a consultation “on the practice of cash retention under construction contracts”, with its outcome imminent. Meanwhile a private members’ bill from Peter Aldous received its first reading but its second is delayed until October. The cynical might consider this a…

Joint Names Clauses Create Own Problems

Blog Author: John D Wright  – JD Risk Associates Summary Standard contract forms such as JCT have a long history of words and phrases being adjusted to meet the evolving demands of business and to develop more compatibility with associated businesses such as insurance. The latest adjustments under JCT 2016 provide further clarity but the fundamental question of who bears the risks in any given situation continues to exercise the minds of all who advise on such contracts. JCT 2016: the final touches? The move…

JCT Standard Building Contract 2016: Simply Fair

Understanding contractual provisions can be complicated but a solid legal framework that also reflects fair payment guidance is essential For payment to work effectively it is necessary for the parties to act properly. Facets of acting properly include good faith, appropriate skill and knowledge of the payment process. Where these attributes exist, few problems regarding payment should occur. Contract authoring bodies for their part can only specifically address the payment process but the simplicity or otherwise of that process has an impact on the ability…

What Can One Learn from Carillion?

Blog Author: Peter Hibberd The collapse of Carillion was a shock and affects many within the industry, not least sub-contractors and suppliers. It was a shock because, despite the warnings of some commentators, large companies supposedly should not go into compulsory liquidation. It is in that belief that a sub-contractor is generally happier to work for large companies. Carillion’s collapse shows that belief, if not entirely misplaced, to be one that cannot be taken for granted. Just because a company is large it is not…

Incompatible Provisions

Blog author: Peter Hibberd Contract interpretation and litigation, it is said, are not exact sciences: this is no better illustrated than by the recent case of MT Hojgaard vs E.ON Climate & Renewables UK Robin Rigg East Ltd, which went all the way to the Supreme Court. At the heart of that case was the tension between different provisions within the various documents that constituted a design and build contract for the design, fabrication and installation of foundations for 60 wind turbines. In essence the…

JCT Payment Notices: Welcome Guidance from the Court of Appeal

Construction standard form contracts have a great deal to recommend them. Parties to a contract can save time and cost by starting negotiations with an industry recognised set of terms which deals with all the matters that the parties may have to agree. But while a standard form provides a good starting point, it needs to be adapted to meet specific project needs. Parties should take great care when doing this because, as the case of Balfour Beatty Regional Construction Limited v Grove Developments Limited…

JCT Design and Build Contract 2016: Simply Fair

At the time of the government’s consultation on Building a Responsible Payment Culture I commented on the balance between legislative intervention and the freedom to contract. At that time it was debatable whether further legislative intervention in contractual payment was desirable. Other commentators also expressed doubts. However the driver then, which still prevails, was that the payment process still needs improving. Therefore, it is not wholly surprising that we have seen further legislative change and government guidance as regards fair payment, albeit not as extensive…

JCT Design and Build and JCT Standard Building Contracts 2016 – Part II

JCT has published the new edition of 2016 Design and Build Contract in conjunction with the Design and Build Sub-Contract for use with it. The purpose of this note is to outline the principal changes from the previous 2011 edition and answer some frequently asked questions. Part I of this article was published in the February edition of JCT News. How is Loss and Expense for delay dealt with? Section 4 which deals with loss and expense still requires prompt initial notification of claims, or…

Obtaining Planning Consent – What is Your Responsibility?

Blog authors: Emily Dickson and Emily Pittaway – BLP Law Securing planning consent is a fundamental first step for any development project. Where a building contract does not expressly oblige either party to apply for or obtain planning consent, or other project specific approvals such as conservation area or listed building consent, who bears this responsibility? This is an important issue, particularly in circumstances where such consents are not obtained in time for the works to start. If responsibility falls on the employer, then the contractor…

JCT Design and Build and JCT Standard Building Contracts 2016 – Part I

Blog Author: Suzanne Reeves – Partner, Wedlake Bell JCT Design and Build 2016 Contract JCT has published the new edition of 2016 Design and Build Contract in conjunction with the Design and Build Sub-Contract for use with it. The purpose of this note is to outline the principal changes from the previous 2011 edition and answer some frequently asked questions. In summary, these are: Introduction of common “Interim Valuation Dates” which will apply throughout the contract chain including at sub-contract and sub-sub-contract tiers. Introduction of…