Construction Law: May 2022

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.

Construction Law; April 2022

Editor’s comment
Backpedalling on procurement reform
Editor Nick Barrett warns that previous government commitments to public procurement reform are under threat of being diluted.

News
This month’s news roundup covers a possible policy reversal regarding emphasis on social value in public procurement, further warnings of project delays and insolvencies in light of the Ukraine crisis and and update on evidence heard by the Grenfell Tower Inquiry.

Legal terms explained
Xavier Milne of Herbert Smith Freehills LLP explains what is meant by Consequential Loss.

Guest editor
Challenging times for construction professionals and design and build contractors
Guest Editor Tom Pemberton of Lawrence Stephens Solicitors warns construction professionals and design and build contractors to take care both when negotiating their contracts and in managing their work to minimise the risk of claims for alleged breach of duty of care. The risks are increasing, he cautions.

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 review of the court decisions of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who examine a case that shows the Claimant-friendly approach being taken by the courts in relation to amendments to pleadings and limitation, especially in relation to cladding / fire safety claims; and one that acts as a further reminder of the risks of entering into oral contracts.

Analysis
Managing weather risk: an essential part of contracting playbooks
Weather is a key and increasingly significant element of risk for construction projects. Diarmuid Bairéad of Turner & Townsend argues that it is time for climate risk to be brought out of the cold and made an integral part of the contracting playbook.

CL guides
Professional appointments
In our latest Construction Law Guides series article from DLA Piper, Lina O’Gorman looks at professional appointments. Risk allocation varies between standard forms and between them and typical bespoke appointments.

Legislation
Scotland and England differering on building safety reform
Caroline Maciver and Lynda Ross of Burness Paull LLP explain the differing approaches to reform of building safety being taken by the Scottish and UK governments. The ‘broken system’ in England contrasts with the less radical reshaping of the system taking place in Scotland.

Frameworks
Collaborative contracting key to construction frameworks
Anne-Marie Friel and Samantha Conkling of Pinsent Masons LLP support Professor David Mosey’s report on Frameworks and its recommendations. They warn that there are poorly drafted frameworks that do little to promote the collaboration that the Gold Standard urges.

Litigation
Experts on Trial
Chris Bryden and Georgia Whiting, barristers at 4 King’s Bench Walk, examine case law surrounding the role of expert witnesses, which suggests a worrying trend towards a loosening of the established principles of how experts should behave, and are instructed.

Contracts
Change the Precedent, Change the World
Jane Hughes and Laura Lintott of Trowers & Hamlins LLP argue that ‘green thinking’ means future thinking. In this analysis of the green contract clauses that are emerging to support the climate change battle they advise on practical and legal issues facing those who want to ‘go green’.

Insurance
Long tail liability
Our insurance expert John D Wright of JD Risk Associates looks at the problems associated with the ‘long tail’ feature of liability insurance policies. Converting policies to a claims made basis would avoid the long tail liability problem but there are problems associated with such a change.

Alternative dispute resolution
Negotiated Dispute Resolution
Our latest Alternative Dispute Resolution (ADR) series article from Tracey Summerell of Dentons UK and Middle East LLP examines the reasons for now calling ADR Negotiated Dispute Resolution.

Construction Law: March 2022

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.

Construction Law: January/February 2022

Editor’s comment
Procurement opportunity must be grasped
Editor Nick Barrett says that thanks to several recent procurement related reports construction has been offered a rare opportunity to make significant improvement.

News
This month’s news roundup includes a warning from lawyers that new procurement rules could be open to abuse, an update on the Grenfell Tower Inquiry and details of a large fine received by Balfour Beatty’s American subsidiary for defrauding the US military.

Legal terms explained
Stephanie Lamb and Elissa Patel of Herbert Smith Freehills LLP explain how liability caps and exclusion clauses work.

Guest editor
Constructing the Gold Standard – how to fulfil the potential of frameworks
Professor David Mosey, Centre of Construction Law and Dispute Resolution, King’s College London, author of the recently published ‘Gold Standard’ review of construction frameworks, explains how they could provide impetus to drive a range of benefits including a more profitable industry.

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 cases of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who look at a dispute over whether a client had verbally agreed to waive liquidated damages; and a rejection of a claim to strike out an action that confirms the high threshold the courts set for such claims.

Analysis
How Building Information Modelling can strengthen your legal strategy
The use of Building Information Modelling (BIM) is on the rise but Stewart Bailey, director of property technology specialist Virtual Viewing, warns that incorrect implementation can increase construction costs, cause delays and carry legal consequences.

CL guides
Design Liability
Our latest Guides series article from Ross Galbraith of DLA Piper considers design liability of both contractors and consultants.

Annual review of 2021
Covid related disputes to continue in 2022
In this review of 2021, Herbert Smith Freehills LLP highlight some of the key developments of the past year, how issues faced by the construction industry have been considered by the courts and what we may expect looking ahead to 2022.

Sustainability featured in Scottish construction law’s year
Shona Frame and Sophie Malley of CMS review some important and wide-ranging developments that took place in Scottish construction law in 2021. Fittingly, as the COP26 event was held in Glasgow, sustainability was a feature of the year, with, for example, consultation launched on energy standards contained in the Building (Scotland) Regulations 2004.

Technology
The cyber threat to construction, engineering and energy
Construction, energy and engineering companies have lagged others in taking steps to protect themselves from the growing number of cyber-attacks. Vijay K Bange and Chris Recker of Duane Morris warn that failing to take preventive measures can lead to expensive litigation.

FIDIC
The bare bones of design and construction under FIDIC
In the third of our series on FIDIC forms Robert Meakin and Dominika Wlodarska of Clyde & Co make a close reading of the opening clauses of the contracts in the 2017 suite.

Insurance
Aggregation or aggravation?
Our insurance expert John D Wright of JD Risk Associates explains why the lack of standard wordings relating to aggregation clauses in insurance contracts means that the high level of litigation over their interpretation is likely to continue.

Alternative dispute resolution
Pre-Action Protocol reforms
In our latest alternative dispute resolution series article Tracey Summerell and Akin Akinbode of Dentons UK and Middle East LLP review proposed Civil Justice Council reforms that will impact on pre action protocols.

Construction Law – December 2021

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.

Construction Law: November 2021

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.

Construction Law: October 2021

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.

Construction Law: August/September 2021

Editor’s comment
Report highlights need for procurement overview
Editor Nick Barrett says the Latest National Audit Office report highlights yet again the need for procurement reform. Lessons may have been learned from the Carillion collapse.

News
This month’s news roundup features a warning that material shortages and cost pressures are set to result in a rise in construction disputes. In addition, lawyers respond to the new Building Safety Bill and the Civil Justice Council has declared that compulsory alternative dispute resolution is lawful.

Legal terms explained
Noe Minamikata and Michael Sharp of Herbert Smith Freehills LLP explain what is meant by novation.

Guest editor
The role of export credit agency financing
Guest editors Lauren Davies, Counsel, and Vanessa McLellan of Vinson & Elkins RLLP argue that export credit should not be overlooked as a source of funding or support for large projects.

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 and Akin Akinbode provide a commentary on the Building Safety Bill.

Reports from the courts
Our regular round up of the court cases of most interest to construction comes from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP who examine a decision where the judge criticised claimants for not using adjudication; and another that highlights the dangers of oral contracts.

Analysis
In-person and virtual evidentiary hearings: are hybrid hearings the way forward?
Virtual hearings have proven that they can work during a pandemic but are they here to stay? Scott Stiegler and Ben Grunberger-Kirsh of Vinson & Elkins argue that hybrid models combining in-person and virtual evidence might become the norm.

CL guides
Price and payment
The latest in our Guides to Construction Law from DLA Piper whose Clare Rushton explains the often thorny issues of price and payment in contracts.

Legislation
Retrospective liability claims: what you need to know and where to start
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.

Procurement
Promoting ethical purchasing decisions
Construction is at the forefront of a procurement revolution that will enforce proper attention being given to the ethical sourcing of materials and services. Mark Fletcher of Russell-Cooke LLP warns that the ability of employers to enforce their values is still constrained by legal and commercial considerations.

Disputes
The root cause of evil
Vijay K. Bange and Tanya Chadha of Duane Morris explore trends in disputes emerging in the energy sector across four jurisdictions – the United Kingdom, Middle East, United States and Caribbean and Latin America.

Economic loss
Why economic loss is an issue in claims
Jane Hughes of Trowers & Hamlin LLP examines the often difficult to explain issues surrounding the concept of economic loss. Sustained pressure on the legal principles behind it is expected, she warns.

Insurance
Disclosure, waiver and the Insurance Act 2015
Insurance expert John D Wright of JD Risk Associates asks what difference has been made by changes in the Insurance Act 2015 to the principle of ‘good faith’ as it applies to policies. Bias towards insurers might have been removed but legal disputes still arise, he cautions.

Alternative dispute resolution
New Digital Dispute Resolution Rules
In our latest Alternative Dispute Resolution series article Tracey Summerell of Dentons UK and Middle East LLP says ‘new tech’ like smart contracting is developing rapidly and is set to disrupt the industry’s approach to both contracting and dispute resolution.

Construction Law: July 2021

Editor’s comment
Contracts need risk management
A survey from Arcadis shows that poor understanding and use of contracts is the major cause of disputes. Editor Nick Barrett says old attitudes to understanding what contracts mean and how to use them as management tools represent poor risk management.

News
This month’s news roundup features a report showing that the average value of construction disputes rose to its highest level ever last year; a warning that an increase in insolvencies could be on the horizon due to tender price inflation; and details of the Technology & Construction Court’s annual report.

Legal terms explained
Rahul Prakash of Herbert Smith Freehills LLP explains how limitation periods function.

Guest editor
Cladding- papering over the cracks?
Barristers Chris Bryden and Georgia Whiting of 4 King’s Bench Walk use the Guest Editor slot to analyse some of the who-pays for remedial cladding post-Grenfell questions that are still unanswered. Two recent court decisions of relevance to professionals faced with the cladding conundrum are worth considering, they argue.

Legislation state of play table
The latest in our regular update on the progress of regulations and legislation affecting construction comes from Steve Dale of Barrett Byrd Associates. Adam Brown of Dentons provides a commentary on the Group of Seven and Net Zero.

Reports from the courts
In the latest of our Reports from the Courts series of articles Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP examine a case reminding parties to ensure strict compliance with contractual notice provisions, and be wary of ‘final and binding’ clauses; and another judgment that is a clear reminder of the uncertainty that can arise when works commence prior to the execution of a formal contract and the risks of letters of intent.

Analysis
Digital Technology in Construction: An Opportunity for Change
Risk experts on insurance and construction respectively, Graham De Roy and Stephen Woodward consider how digital working offers opportunities to correct the loss of appetite by the insurance industry for insuring construction industry risk.

CL guides
Time in construction contracts
The latest of our guides to construction law series comes from Rachel Chaplin of DLA Piper who explains the role of time in construction contracts.

Witness statements
New rules on witness statements
Judges had become unhappy with witness statements, particularly because of extensive referencing of documents, mixing facts with arguments and lack of use of witness’ own words, so have instituted reforms, as Theresa Mohammed, Laura Lintott and Megan Hulme of Trowers & Hamlins LLP explain.

Good faith
Good Faith, Mutual Trust and Cooperation – Oh My!
Good faith type arguments have been coming to the fore in disputes over the past five years, as Katherine Doran of HFW LLP highlights as she reviews case law to find guidance on how the courts might interpret mutual trust and cooperation obligations in NEC contracts.

Adjudication
Too late to join the DAB party?
Barrister Karen Gough of 39 Essex Chambers, also a Chartered Arbitrator and accredited Adjudicator, asks whether the JCT has found a winner with its hybrid DAB/Adjudicator dispute avoidance and statutory adjudication offering. There are risks in the JCT DAB structure that will need to be assessed when tested in the Courts, she warns.

Insurance
Product liability insurance
Insurance expert John D Wright of JD Risk Associates examines product liability insurance, which has come under the spotlight following the Grenfell tragedy. Higher insurance costs and restricted cover from policies are to be expected, he warns.

What cover do lenders want from a borrower developer?
Anne Wright of Lawrence Stephens takes a look at the background to the current problems with the insurance market, explaining the main types of insurance in use in the industry and what lenders will demand from borrower developers.

Alternative dispute resolution
How can the solicitor assist in safeguarding expert evidence?
Michael Wright and Millie Leonard of Dentons UK & Middle East LLP analyse a case that highlights the role of solicitors in the proper handling of expert evidence in our latest alternative dispute resolution series article.

Construction Law: June 2021

Editor’s comment
Toxic and dysfunctional industry awaits its revolution
Editor Nick Barrett says tinkering with payment practices won’t be enough of a solution to the industry’s problems when even the Times in a three day series of articles suggests that the industry is ripe for revolution. It’s long overdue, he says.

News
This month’s news roundup features a warning that expected price inflation in construction could lead to harder fought claims, details of proposed new powers for the Insolvency Service to help tackle ‘phoenixing’, and the results of a major survey on international arbitration.

Legal terms explained
Michael Sharp and Noe Minamikata of Herbert Smith Freehills LLP explain the Construction Act.

Guest editor
A Smart Risk Register – a tool for non-adversarial behaviour
Guest Editor’s project team consultant Kelachi Amadi-Echendu and barrister Professor Rudi Klein consider how, through creating transparency and behaviour focused on aligned project outcomes, a Smart Risk Register supports the government’s Build Back Better plan.

Legislation state of play table
Dentons UK and Middle East provide our regular update on developments in regulations and legislation as they affect construction. Tracey Summerell comments on mounting pressures on the industry to reduce emissions.

Reports from the courts
Our regular round up of court cases of most interest to construction from Andrew Croft and Ben Spannuth of Beale & Company Solicitors LLP features one that highlights the need to ensure a project’s supply chain has appropriate insurance; and a judgment that provides comfort to those relying on limits of liability and exclusion clauses that the courts will take a common-sense approach.

Analysis
Unexploded bombs – who pays?
Jane Hughes and Robert Scudamore of Stevens & Bolton LLP try to fill an information gap on who should be liable for damage caused by unexploded Second World War bombs? Those still buried in the ground are deteriorating all the time.

CL guides
Letters of intent
The latest in our construction guides series from DLA Piper by Jennifer Price-Thomas looks at Letters of Intent, which she warns can carry pitfalls for the unwary.

Design obligations
Warranted trends in design standards
Harith Canna of Herbert Smith Freehills considers significant recent developments concerning design-related obligations, which lie at the core of any construction contract, and their impact on the procurement of construction projects.

Duty of care
Developments in the law of negligence and third-party liability
Claims involving duty of care when damage is caused by a third party are at the fore of developments in the law of negligence, as Barry Hembling of Watson, Farley & Williams LLP reports in this analysis of recent court cases.

Sustainability
Green dispute resolution procedures – what they are and how to use them
In a previous article (Construction Law Vol 32 No 2) Jane Hughes of Stevens & Bolton LLP looked at incorporating green drafting into construction contracts. In this follow up she considers how disputes can be dealt with in a greener, more sustainable way.

Tort of nuisance
The Tort of Nuisance – Overlook It At Your Peril
Chris Bryden and Georgia Whiting of 4 King’s Bench Walk examine the tort of private nuisance, a complex area which they warn has the potential to affect construction professionals in far-reaching (and evolving) ways.

Insurance
Hard times for professional indemnity
Insurance expert John D Wright of JD Risk Associates examines the current crisis in the professional indemnity market, which he predicted some two years ago. Policyholders can however take steps to help secure cover at an affordable cost.

Alternative dispute resolution
Arbitration exhibiting ‘due process paranoia’
Our regular Alternative Dispute Resolution article comes from Tracey Summerell of Dentons UK and Middle East who asks whether it is time for arbitration to lighten up.