Do the Different Tiers of Building Contract Really Need to be Back to Back?

Blog Author: Alexandra Reid The main JCT contracts specify that where this is ‘considered appropriate’ the contractor should engage its sub-contractors using the relevant version of the JCT sub-contract which sits beneath the main contract in question. JCT contracts are therefore drafted in such a way that ‘back to back’ obligations are ensured. So what can this mean for contractors? A short answer is that the JCT has satisfied itself that its own sub-contracts have been carefully drafted to ensure that their key contractual terms…

The Big Question: Can You Pay Now and Argue Later?

Blog Author: Hazel Boland-Shanahan A top judge came out of retirement to help decide a crucial question around interim payments and adjudications, as Hazel Boland-Shanahan explains. Confusing case law on interim payments led to the rise of smash-and-grab adjudications. The Court of Appeal judgement in S&T (UK) Limited v Grove Developments provides reasoned clarity as well as other helpful guidance. Just because the sum stated in a payment certificate or default payment notice has become due, does not mean that it represents the true value…

The Impact of Digitalisation on Claims, Disputes and Their Avoidance

Blog Author: Charlie Woodley Research from HKA unveils the true complexity of causation and provides thought-provoking insight that illustrates how digitalisation can achieve dispute avoidance by proxy or reduce their severity and prevalence. Information technology is critical to our ability to manage complexity, inform decision-making, improve productivity, and reduce uncertainty, thereby mitigating risk. But technology alone will not suffice and broader digitalisation and transformation of organisations, supply chains or industry require investment in people, process as well as technology. Each must be considered equally, and…

Concurrent Delay: Allocating the Risk

Blog Author: Mark Wilkins – Fenwick Elliott Concurrent delay is an issue which continues to be a topic of much debate. Marc Wilkins explores how recently, the spotlight has turned to the enforceability of clauses which seek to allocate the risk of concurrent delays. In last year’s Annual Review Jeremy Glover reported on the decision of Mr Justice Fraser in North Midland Building Limited v Cyden Homes Limited¹. In July of this year the case came before the Court of Appeal². The dispute concerned a…

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…