Construction Law: May 2025

Editor’s comment
No coherent plan for water investment programme, says NAO report
Editor Nick Barrett asks how, in light of a new National Audit Office report saying the condition of water industry assets is largely unknown, the industry’s companies and regulators arrive at the large numbers approved for water investment programmes?

News
Our regular news round up includes a new regime for corporate crime from the Serious Fraud Office; financial close on a key carbon capture and storage project; and legal action starting against Grenfell Tower tragedy related companies.

Legal terms explained
Zhou Yang of Herbert Smith Freehills LLP explains how adjudication works in cases of insolvency.

Guest editor
Bill could fundamentally change the shape of the planning system
Guest Editor Ben Garbett of Keystone Law examines the Planning and Infrastructure Bill that is now before Parliament, which he says has the potential to address some of the planning system’s fundamental weaknesses.

Legislation state of play table
Our regular update on the progress of regulations and legislation affecting construction and procurement compiled by Alignment Media.

Reports from the courts
Our latest round up of the court decisions of most relevance to construction comes from Andrew Croft, Ben Spannuth, and Daniela Miklova of Beale & Company Solicitors LLP, who look at a decision providing a useful reminder that assignments do not transfer liabilities to an assignee and that only the benefit of a contract is transferred; and another that emphasises the importance of clear drafting throughout contract negotiations and including the correct and necessary documents are included in the final version of the contract.

Analysis
Government net zero commitment looks firm
Net zero plans, which will have major impacts on construction, are proceeding apace, despite a Conservative party rollback on its commitment to a policy initiated by a previous Conservative administration.

CL guides
Construction Law Guide to: Letters of Intent
Our latest CL Guides series article comes from Jennifer Price-Thomas of DLA Piper who examines Letters of Intent, offering guidance on common pitfalls to be avoided.

Mental health
Balancing justice and wellbeing while rethinking adjudication culture
Mike Waring of Knights warns that the adversarial nature of adjudication is taking a toll on the mental health of both lawyers and their clients. A culture shift is needed and adjudicators need to take a firmer hand in discouraging toxic behaviours.

Design liability
Contractor vs. Designer: Unravelling design liability differences
Joseph Wittenberg of Turner & Townsend Contract Services warns contractors to be wary of trying to reduce design liability through contract clause wording. The courts will find that a term warranting a specific performance will trump any conflicting clause seeking to reduce the contractor’s design liability to reasonable skill and care.

Green drafting
Limiting construction’s environmental footprint using climate conscious drafting
Alexandra Holsgrove and Corinna Whittle of TLT explain how climate conscious drafting of contract clauses can contribute to the climate change battle. Contracts as well as technical documents can include specific climate obligations.

Insurance
Court ruling could have wide implications for professional indemnity insurance in Northern Ireland
Catriona McCorry of DAC Beachcroft outlines the key changes to building safety legislation in Northern Ireland introduced by the Defective Premises Act (Northern Ireland) 2024. Its impact on construction is highlighted by the recent group action in the case of Ulster Garden Villages & Others v Farrans (Construction) Limited & Others.

Indemnity limits – a qualified promise
Insurance expert John D Wright of JD Risk Associates explains how variations on aggregation causes in policies give rise to problems that look like continuing to keep the courts busy. Every word and phrase will have to be interpreted by the Courts, applicable to the facts of each case, he warns.

Alternative dispute resolution
Design liability in construction
Cheryl Ferguson of Dentons UK and Middle East LLP examines a recent TCC decision. Given the technical complexity involved, construction disputes of this nature can benefit from ADR approaches, she suggests.

Crown Estate partnership to unlock £24 billion of developments

The Crown Estate and Lendlease have agreed a partnership that it is hoped will unlock housing and science innovation hubs across the UK worth £24 billion.

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Ministry rejects New Towns cost estimates as ‘purely speculative’

Government plans for a dozen new towns in England could cost up to £48 billion, according to a report examining the best locations to build them. The report from WPI Strategy however was immediately rejected by the Ministry of Housing, Communities and Local Government (MHCLG) as ‘extremely speculative’.

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Builders call for licensing system to be introduced

The Federation of Master Builders (FMB) has launched a model for licensing building companies, after a decade long campaign and cross-industry collaboration to get the issue on the Government’s agenda.

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New partnership model proposed for next-generation privately funded infrastructure

Development, building and property services specialist Wates Group has launched a ‘white paper’ calling for the government to rethink its position on private finance to deliver real growth for the UK economy.

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Supreme Court ruling makes it easier to sue designers and builders for building safety defects

The Supreme Court has handed down a judgment in a case involving its first consideration of the Building Safety Act 2022, which is being seen as a victory for developers by making it easier to sue suppliers for historic building safety defects.

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Pensions pledge to invest in UK infrastructure ahead of pensions investment review

Up to £50 billion of investment for UK businesses and major infrastructure projects could be unlocked through a new agreement signed this week (13 May) between the government and Britain’s biggest pension funds.

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Caterpillar accused of lack of candour as anti dumping judicial review bid fails

The Government has accepted the Trade Remedies Authority’s recommendation to impose new anti-dumping and countervailing measures on imports of excavators from China to the UK.

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Contractor and four others face manslaughter charges over death of member of the public

Contractor Higgins Homes has been charged with corporate manslaughter and health and safety offences and four employees with gross negligence manslaughter over the death of a woman who was hit by a pallet of bricks that fell from a crane.

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Government not to be trusted to mark own homework on building safety, MP’s say

The government should introduce an independent national oversight mechanism and not be ‘left marking its own homework’ when implementing the recommendations of the Grenfell Tower inquiry, says the House of Commons Housing, Communities and Local Government (HCLG) Committee in a letter to Secretary of State Angela Rayner.

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‘Major milestone’ reached in energy infrastructure planning

In what is said to be a ‘major milestone’ for the planning of the UK’s energy network, Secretary of State for Energy Security and Net Zero Ed Miliband has formally approved the methodology to be used by the National Energy System Operator (NESO) in developing the UK’s first Strategic Spatial Energy Plan (SSEP).

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