Contents

Editor’s comment
Bid rigging a thing of the past?
Editor Nick Barrett detects signs that some anti competitive behaviour in construction could be viewed as a thing of the past by competition regulators; but never underestimate criminal stupidity he warns.

News
This month’s news roundup features a warning that poor information management is affecting construction firms’ ability to defend themselves against claims, as well as a cladding dispute involving Balfour Beatty and a report which suggests funders are likely to steer clear of high polluting schemes.

Legal terms explained
Sebastian Morton, Elissa Patel and Mathew Shelley of Herbert Smith Freehills LLP explain how subrogation works.

Guest editor
Root and branch reform needed to tackle building safety
Guest Editor, Philip Bambagiotti of 3PB Barristers questions whether the proposed post Grenfell approach to building safety will deliver. A new law reform strategy is needed to address widespread problems of defective buildings, he argues.

Legislation state of play table
Our regular update on the progress of legislation and other developments affecting construction from News Editor Steve Dale who provides a commentary on the CLC’s reponse to rising inflation.

Reports from the courts
Our regular round up of recent court decisions of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who examine a case that reinforces the courts’ robust approach to adjudication enforcement, and highlights the importance of compliance with the immediate payment obligation where the requisite notices have not been served; and a fire safety related case where the decision contrasts with a recent claimant-friendly decision.

Analysis
Five years on from Grenfell – a review of progress
News editor Steve Dale takes stock of the key building safety developments which have followed in the aftermath of the Grenfell Tower fire. Progress has been slow, with some corners of the industry being urged to show greater impetus.

CL guides
Contract Administration
In our latest CL Guides series article Lynn Auchterlonie of DLA Piper examines the role of the Contracts Administrator.

Technology
Enabling the digital twin
Anne-Marie Friel and Alastair Dale of Pinsent Masons LLP explain why BIM will be at the heart of developing the ‘golden thread’ of digital information, and argue that contracts and procurement strategies need to change their approach to accommodate this.

Contracts
Dealing with inflation under NEC Secondary Option X1
Inflation is a problem for the industry and it is getting worse. Isobel Moorhouse and Jane Hughes of Trowers & Hamlins LLP examine how the NEC4 engineering and construction contract handles the need for price adjustments.

Limitation Clauses
The limits of limitation of liability clauses
Barristers Chris Bryden and Georgia Whiting of 4 King’s Bench Walk review recent case law affecting the use and limits of limitation clauses, which reaffirms that the courts are likely to take a strict approach to the construction of an exclusion or limitation clause, particularly where the right in question is a valuable one.

Arbitration
Tiered Alternative Dispute Resolution Agreements
Vijay K. Bange of Duane Morris examines a recent Hong Kong court decision affecting tiered Alternative Dispute Resolution (ADR) provisions that considers if it is within the jurisdiction of the courts to decide if the parties to a contract have complied with the ratchet dispute resolution procedure, or whether this should be dealt with by the arbitral tribunal.

Insurance
Insurers still challenging Covid claims
Insurance expert John D Wright of JD Risk Associates warns that although Covid remains a threat to businesses the insurance industry does not regard pandemics as being covered by non damage denial of access clauses. A Supreme Court ruling leaves some existing individual claims unresolved.

Alternative dispute resolution
ADR’s place in the Digital Justice System
Our latest alternative dispute resolution series article, from Tracey Summerell of Dentons UK and Middle East, analyses the role that might be played by ADR as the justice system digitalises.

Editor’s comment
Social value a procurement challenge
Editor Nick Barrett asks how assessing social value factors in bids will be handled when the Procurement Bill becomes law.

News 
This month’s news roundup includes a look at the long awaited Procurement Bill, plus a warning that claims related to the impacts of the Ukraine crisis are on the rise and a report that highlights significant modern slavery risks in the sector.

Legal terms explained
Valerie Chee and Mathew Shelley of Herbert Smith Freehills LLP explain how performance guarantees and liquidated damages allocate risk in contracts.

Guest editor
The Sky’s the Limit – but how long will that be true?
Guest Editor James Davison of 3PB Barristers bemoans the disproportionality between the amounts in dispute in some low value cases and the legal costs, and asks if the Construction Act, which is starting to feel like a solution to a problem from another time, needs reform

Legislation state of play table
Our regular update on the progress of legislation and other developments affecting construction from News Editor Steve Dale who provides a commentary on the Levelling Up & Regeneration Bill.

Reports from the courts
Our regular round up of recent court decisions of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who report on a rare example of the courts refusing enforcement of an adjudicator’s decision; and another that acts as a reminder to ensure that the basis of the pricing and the payment mechanism in a contract is expressed clearly and understood from the outset to avoid later disputes.

Analysis
Sustainability in Construction
Zoe Stollard and Alex Clark of Browne Jacobson report from a Roundtable event involving construction, manufacturing and energy clients that discussed, among other things, best practice in low carbon procurement. Firms must ensure the principles of sustainable construction are not superseded by cost and aesthetics, it was highlighted.

CL guides
FIDIC
The latest in our Construction Guides series comes from Rachel Chaplin of DLA Piper who examines key aspects of the FIDIC suite of contracts.

Adjudication
“What goes without saying…”
Barrister, arbitrator and adjudicator Karen Gough of 39 Essex Chambers London describes the circumstances under which parties to adjudications can refuse to pay adjudicator’s fees, examining a Court of Appeal decision that clarifies adjudicators’ entitlement to payment on resignation for grounds not expressly dealt with in the Act or Scheme.

When a frolic becomes unfair
Barry Hembling of Watson, Farley & Williams LLP analyses two recent adjudication related judgements with implications for when a decision can be set aside on natural justice grounds. Have they provided more questions than answers?

Legislation
Building Safety Act 2022
Christopher Leadbetter, Sharni Mellors, and Iain Boyle of Clyde & Co provide an overview of the main features of the Building Safety Act, the largest ever statutory intervention in the construction industry. New obligations will impact almost all levels of the construction and development industries, they say.

Contracts
Climate clauses for construction contracts
A group of construction professionals, including lawyers, has taken a pro bono initiative to draft contract clauses to support the climate change battle. Leonie Brabant and Josh van den Dries of the Chancery Lane Project outlines the clauses and invites industry support for further related developments.

Insurance
Practical Completion – the elephant in the room
Insurance expert John D Wright of JD Risk Associates examines the insurance implications of practical completion. Liabilities for liquidated damages end with practical completion, but this can throw up difficulties, he warns.

Alternative dispute resolution
Disputes of the future?
Tracey Summerell of Dentons UK and Middle East reports from a disputes conference in our latest alternative dispute resolution series article. Sustainability and human rights will increasingly feature in contracts, it is clear.

Editor’s comment
Modern slavery reporting lacks conviction
News Editor Steve Dale considers how shortcomings in modern slavery reporting among large companies can be addressed to help stamp out the problem.

News
This month’s news roundup leads with Housing Secretary Michael Gove’s threat to pursue cladding manufacturers for contributions to remediating unsafe buildings. We also focus on the implications of a new procurement directive that could see public authorities cutting ties with Russian suppliers, and a fresh call for legislation on cash retentions.

Legal terms explained
Stephanie Lam and Mathew Shelley of Herbert Smith Freehills LLP explain what is meant by reasonable skill and care.

Guest editor
Beyond the Looking Glass
Guest Editors James Wyatt, Megan Everett and Robert Meakin of Clyde & Co highlight key risks facing construction as revealed in their recent Looking Glass Report. The industry has the adaptability to thrive if it tackles the risks head-on and embraces new practices.

Legislation state of play table
Our regular update on the progress of legislation and other developments affecting construction from News Editor Steve Dale who provides a commentary on a CLC guidance note on collaboration.

Reports from the courts
Our regular round up of the court decisions of most interest to construction from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP examines a case that will interest anyone hoping to invoke force majeure clauses against the background of sanctions against Russia; and another that serves as a reminder that terminating parties must take care to follow contractual termination procedures in their entirety.

Analysis
UK construction urgently needs challenging leadership
In a call to long overdue action barrister Rudi Klein of KleinLegal, formerly CEO of the Specialist Engineering Contractors Group, and risk management consultant Stephen Woodward argue that despite widespread recognition that the industry’s business model is unsustainable, reform will not be achieved unless all those with a passion for radical industry improvement are prepared to join forces to put the industry on a healthier and viable footing.

CL guides
Termination
The latest in our Construction Law guides series from DLA Piper is by Clare Rushton, who examines termination provisions in contracts. Termination is rarely uncontentious and frequently results in significant disputes, she warns.

Procurement
Procuring Net Zero Carbon Construction
Professor David Mosey of King’s College London Centre of Construction Law & Dispute Resolution explains how all parties in the supply chain can use procurement and contracting systems to meet net zero carbon targets.

Arbitration
Amuse Bouche to the Arbitration Act Reform
Theresa Mohammed and Laura Lintott of Trowers & Hamlins LLP report on the Law Commission’s review of the Arbitration Act 1996. The hope is that reforms will increase enthusiasm for English Law to continue to dominate as the preferred choice of law for international arbitrations.

Adjudication
Pay Up or Feel the Heat: Grove in Action
Barrister James Davison of 3PB Barristers examines a 26 page Judgment from the Technology and Construction Court that touches on the key issues for payment rights and adjudication. Changes to the way parties approach adjudication are recommended.

Contracts
A discussion of JCT Fluctuations Options A, B and C
Jane Hughes and Isobel Moorhouse of Trowers & Hamlins LLP analyse the fluctuation clauses in the JCT Design & Build contract, which are becoming increasingly important against a background of rising inflation. Which type of fluctuation provision to incorporate in a contract, and whether to amend it, will be highly project specific.

Insurance
Insurance brokers can be your allies
Insurance expert John D Wright explains why insurance brokers can be valuable allies to construction companies facing increasingly complex challenges. Choice of broker is always important as some might not always meet the standard of care demanded.

Alternative dispute resolution
Answering the substantive claim
In our latest alternative dispute resolution series article Millie Leonard of Dentons UK and Middle East examines an appeal ruling in a case where a party sought to stay proceedings as issues were being referred to arbitration.

Editor’s comment
Is PFI about to be reborn?
In the absence of any obvious alternative, the once discredited Private Finance Initiative looks like being revived to support ambitious infrastructure investment plans, Editor Nick Barrett says.

News
This month’s news roundup includes a warning that projects could be impacted by escalating insolvencies which are anticipated over the coming year, an update on the Grenfell Tower Inquiry and details of a lawsuit brought by the Official Receiver against collapsed contractor Carillion’s auditor, KPMG.

Legal terms explained
Alice Pickthall of Herbert Smith Freehills LLP explains penalty clauses.

Guest editor
What construction lawyers will be talking about for the rest of 2022
Guest Editors Will Buckby and Tom Howell of Beale & Company Solicitors LLP ask what the ‘new normal’ will look like for construction. The industry has shown great resilience during the past two Covid years but should continue to expect the unexpected, they warn.

Legislation state of play table
Our regular update of the progress of legislation and new regulations as it passes through the legislative process, prepared by Construction Law staff writers. News editor Steve Dale provides a commentary on a key issue.

Reports from the courts
Our regular round up of the court decisions of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who look at a dispute between a houseowner and a builder that highlights the importance of parties ensuring strict compliance with the payment and termination provisions in contracts; and another where the decision stands as a reminder of the importance of having a clear contract in writing and for careful and timely invoicing.

Analysis
The bill for cladding scandal to hit pockets hard
The entire construction supply chain is in the sights of a Housing Secretary determined to make them pay for righting the cladding scandal that caused 72 deaths in the Grenfell disaster. Nick Barrett reports that the measures Michael Gove is considering could backfire if they drive companies into liquidation.

CL guides
Liquidated Damage
The latest in our Construction Law Guides series comes from Jennifer Price-Thomas of DLA Piper who explains how liquidated damages work.

Contracts
The prevention principle
Lucinda Hill and James Doe of HSF examine the prevention principle which although seldom invoked due to the extensive use of extension of time provisions in construction contracts, could be affected by developments in offshore and shipbuilding.

Technology
Protocols aim to reduce Golden Thread uncertainty
Forthcoming legislation will require enhanced attention to information management along the construction supply chain, a ‘Golden Thread’ of information. Andrew Croft of Beale & Company Solicitors, May Winfield of consulting engineer Buro Happold and Simon Lewis of Womble Bond Dickinson report on two new information protocols designed to reduce related legal uncertainty.

Frameworks
New Cabinet Office review of frameworks
Andrew Croft and Kevin Henderson of Beale & Company Solicitors LLP cast their eye over the recently published Cabinet Office commissioned review of construction frameworks that advised how they could achieve a ‘Gold Standard’. Employers might use it to push harder for an unfair risk-share with the project delivery team, they caution.

Procurement
Public procurement must change to support climate change battle
Public sector suppliers are aware that they need to adapt to support the climate change effort, but the public sector itself has to change procurement practices if their efforts are to result in tendering success, warn David Hansom and Hannah Chapelhow of Clyde & Co.

Insurance
Employer’s non-negligence insurance
Our insurance expert John D Wright of JD Risk Associates highlights some issues with Employer’s non-negligence insurance, warning that as minor works can result in major damage to adjoining properties and care must be taken to select an appropriate indemnity limit.

Alternative dispute resolution
Arbitration Act’s 25th anniversary: an opportunity for wider reform
In our latest Alternative Dispute Resolution series article Tracey Summerell of Dentons UK and Middle East LLP argues that the current Arbitration Act review is an opportunity ask how the Act could promote fairness, equality, transparency and access to justice as well as legal and technical excellence.

Editor’s comment
Construction called to perform on net-zero plans
Construction will be central to plans to achieve net-zero carbon by 2050, and the industry is poised to respond, says Editor Nick Barrett, who warns that construction contracts are expected to contain decarbonisation clauses in future.

News
This month’s news roundup features details of a landmark net zero roadmap for construction published at COP26, response to government pledges on unsafe cladding and an update on a dispute over problems with Glasgow’s Queen Elizabeth Hospital.

Legal terms explained
Lucinda Hill and Sienna Kim of Herbert Smith Freehills LLP explain contractual time bars.

Guest editor
The Glasgow Climate Pact – What can the construction industry contribute?
Guest Editors Shona Frame and Emma Schaafsma of CMS ask what contribution construction can make to combatting climate change following the signing of the Glasgow Climate Pact at COP26. Major changes will be needed, along with a lot of innovation and investment, and contractual mechanisms to force contractors to seek greener suppliers can be expected.

Legislation state of play table
Our regular update on the progress of legislation affecting construction as it passes through the legislative process, compiled by Construction Law staff, with a Commentary by News Editor Steve Dale.

Reports from the courts
Our regular round up of court decisions of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who examine a case showing the importance of giving notice effectively when disputing a final statement; and an appeal court ruling confirming that enforcement of an adjudication decision by an insolvent claimant is possible, albeit in limited circumstances.

Book Review
Construction Disputes – Seeking Sensible Solutions
Middle East based mediator and arbitrator Mark Fraser of Fraser & Co reviews Construction Disputes – Seeking Sensible Solutions by Wayne Clark, which he says is recommended reading for anyone involved in construction and engineering.

CL guides
Procurement routes
In our latest Guide to Construction Law series article Peter Lowe of DLA Piper summarises the conventional construction procurement routes in the UK.

Insolvency
A game of chess – insolvency vs. adjudication
Theresa Mohammed and Laura Lintott of Trowers & Hamlins LLP analyse the possible clash between the insolvency and statutory adjudication regimes where a party to a dispute faces insolvency. Case law provides clarity on the right to adjudicate, but practical problems might remain.

FIDIC
The Engineer, aka FIDIC Kingpin
In the second article of our series on FIDIC contracts David Brown and Barnaby Sandy of Clyde & Co examine the role of the Engineer. The Engineer’s role is changing but it can still have a ‘piggy in the middle’ feel about it.

Fluctuations
Super-inflation and the construction and energy sector in the UK
Karen Gough of 39 Essex Chambers analyses a seldom reported fact about adjudication, that despite it being established that an adjudicator can only deal with a single dispute in an adjudication, satellite disputes and jurisdictional challenges continually arise around the issue.

Collaboration
The elastic band of contractual flexibility and Covid-19
Alexander Slade of Vinson & Elkins asks whether the flexibility and collaboration that has been displayed by parties to contracts during the Covid-19 pandemic heralds a new dawn for industry relationships; or will things snap back under the pressure, leading to an increase in disputes?

Insurance
Statutes of Limitation – Still Adapting
Our insurance expert John D Wright of JD Risk Associates examines the impact of statutes of limitation on construction insurance. Post Grenfell, a Building Safety Bill will extend the long stop time limit from six years to fifteen years in respect of defects in buildings which render them unfit for habitation under the Defective Premises Act 1972 and introduce retrospective liability.

Alternative dispute resolution
Mainstreaming ADR: feedback and ideas
In our latest Alternative Dispute Resolution series article Tracey Summerell and Akin Akinbode of Dentons describe their team’s response to the Ministry of Justice call for evidence on dispute resolution.

Editor’s comment
Combatting climate change could also boost procurement skills
Construction procurement will be in the front line of government’s drive towards decarbonisation. Editor Nick Barrett says promises of training for procurement professionals to support net zero carbon ambitions is something to be welcomed.

News
This month’s news roundup covers concerns over supply chain distress and delayed projects, despite an exceptionally low number of profit warnings being recorded in the sector. Also featured are details of updated guidance for managing Covid impacts within contracts and a call to speed up reforms set out in the Construction Playbook.

Legal terms explained
Lucinda Hill and Rahul Prakash of Herbert Smith Freehills LLP explain what negligence means.

Guest editor
Another nail in the coffin for challenges to liquidated damages
Guest Editors Peter O’Brien and Thomas Wheeler of Clyde & Co say recent court decisions show reluctance to look behind what parties have agreed to find a liquidated damages clause unenforceable. Applying the same principles in some scenarios could lead to double recovery of losses by Employers, they warn.

Legislation state of play table
Our regular update on the progress of legislation as it passes through the legislative process comes from Dentons UK & Middle East LLP. Tracey Summerell and Akin Akinbode comments on the UK’s net- zero carbon strategy.

Reports from the courts
Our latest round up of court cases of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP. One judgment reinforces the view that the courts will support ‘the natural and ordinary meaning of the words used’ in commercial agreements; and in a Scottish case the judgment warns against ‘contrived or technical defences’ which the courts will ‘examine with a degree of scepticism’.

Analysis
Strategic focus could prevent race to the bottom on costs, say MPs
With publication of the government’s Comprehensive Spending Review, construction is pinning a lot of hopes for future workloads on government promises about ‘levelling up’ left behind parts of the UK, which is to be at least partly addressed by significant infrastructure investment. Details are only starting to come through but doubts have been raised by MPs that the government even knows what levelling up means, Nick Barrett reports.

CL guides
Defects provisions in constructions contracts
In our latest guides to construction law series article Tom Manley of DLA Piper looks at defects provisions in contracts.

Contracts
Choice of English law for international construction contracts
Mark Macaulay and Gurbinder Grewal of Dentons Middle East and UK LLP consider why English law is a popular choice for construction contracts internationally. Cultural reasons contribute to the high reputation of UK law for doing business under.

Contracts
Supreme Court Triple Point ruling prompts NEC4 amendments
Tom Howell of Beale & Company LLP examines the potential impact on NEC contracts of a Supreme Court ruling that reversed an Appeal Court decision. Case law now supports the ‘orthodox’ approach to the application of liquidated damages prior to contract termination.

Adjudication
Adjudication: Just one [dispute] at a time please!
Karen Gough of 39 Essex Chambers analyses a seldom reported fact about adjudication, that despite it being established that an adjudicator can only deal with a single dispute in an adjudication, satellite disputes and jurisdictional challenges continually arise around the issue.

Mediation
Constructing an Agreement – Mediation in the Construction Industry.
Chris Bryden and Georgia Whiting of 4 King’s Bench Walk lament the industry’s reluctance to adopt mediation more enthusiastically than it has. There is much to gain, and little to lose, by using mediation to resolve disputes, they argue.

Insurance
The ins and outs of subrogation
Insurance expert John D Wright of JD Risk Associates analyses the common law principle of subrogation which is intended to ensure that parties responsible for losses are held accountable. The idea is simple, but complex issues can arise, he warns.

Alternative dispute resolution
Courtesy paves the way for compromise – and wellbeing
Tracey Summerell of Dentons UK & Middle East LLP argues that alternative dispute resolution is more likely to produce a process that promotes positive mental health as well as satisfactory business outcomes.

Editor’s comment
Construction pipeline promises much
Plans to invest £650 billion on new infrastructure over the next decade have been welcomed by the industry, but can the government deliver on the reforms affecting supply chain collaboration, fair allocation of risk and an end to ‘boom and bust’ investment cycles that successful delivery will demand, asks Editor Nick Barrett.

News
This month’s news roundup features the views of lawyers on challenges facing the government’s latest Construction & Infrastructure Pipeline. Also detailed are a report warning that commercial pressures have clashed with Covid safety on some sites and a new verification scheme for construction products.

Legal terms explained
Mike Reynolds of Herbert Smith Freehills LLP explains statutory adjudication.

Guest editor
Grasping the nettle
Guest Editor Karen Gough of 39 Essex Chambers sees a victory for ‘the little man’ in a case in which she represented the successful claimant in enforcement proceedings.

Legislation state of play table
The latest in our regular update on the progress of legislation and regulations affecting construction comes from Dentons UK & Middle East LLP. Tracey Summerell provides a commentary on the Future Homes Delivery Plan.

Reports from the courts
Our regular analysis of the court cases of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who look at one case that involved a post-Grenfell claim for fire safety defects in a building; and another that clarifies the extent to which liquidated damages are recoverable upon termination of a contract before completion of the works.

Book Review
Wilmot-Smith on Construction Contracts 4th edition
Hamish Lal of Akin Gump Strauss Hauer & Feld reviews a new edition of Wilmot-Smith on Construction Contracts that he says makes it one of the leading practitioner textbooks, as well as a key resource for trainees, pupils and beginners.

CL guides
Adjudication
In the latest Construction Guides series from DLA Piper, Jenny Harrison describes how adjudication works as a speedy dispute resolution process. Although a success, adjudication has become a sometimes quasi mini-arbitration dealing with complex, time-consuming construction issues.

Contracts
Golden Principles protect contract integrity
In the first of a series of articles on FIDIC’s contracts Mary Anne Roff and Jennifer Davis of Clyde & Co provides an overview of these key contracts for international construction..

Liquidated damages
Orthodoxy Restored: The Supreme Court Decision in Triple Point
Lucinda Hill and James Doe of HSF analyse the Supreme Court decision that overturned a Court of Appeal ruling based on an erroneous interpretation of the case law on liquidated damages. The ruling will be a relief to the construction industry, they conclude.

Adjudication
Quarter of a century of construction adjudication
Construction is still the only industry that has had specific legislation passed to govern its contracts, although statutory adjudication has now been with us for 25 years. Theresa Mohammed and Laura Lintott of Trowers & Hamlins LLP review its development, reminding us why it was thought necessary to usher in this ‘revolution’ in handling disputes.

Retrospective liability
Retrospective liability claims: what you need to know
Barry Hembling and Hazel Boland-Shanahan of Watson, Farley & Williams LLP analyse proposed changes to building safety legislation ushered in by the Grenfell tragedy which will apply retrospectively, and could allow claims on disputes where the limitation period had expired.

Insurance
HS2 and Tunnelling Risks
Insurance expert John D Wright of JD Risk Associates reviews the extensive range of risk factors that need to be insured on large projects, focussing on the HS2 tunnelling works. An element of self insurance will be shouldered by some parties to the project.

Alternative dispute resolution
Let’s ditch the “A” in ADR
In our latest alternative dispute resolution series article Tracey Summerell of Dentons UK and Middle East says dispute resolution could be on the verge of radical change.