Insolvent firms can adjudicate, Supreme Court rules

The Supreme Court has provided clarity that insolvent companies can refer disputes to adjudication, after a ruling which saw Bresco Electrical Services – in liquidation – succeed in its appeal to adjudicate in a dispute with fellow electrical contractor Michael J Lonsdale.

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News in Brief: 19 June 2020

Housing Secretary Robert Jenrick is being pressed to disclose documents relating to his unlawful decision to grant planning permission for the proposed Westferry Printworks development in Tower Hamlets.

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Lead market cartel members face £11 million in fines

Two of the UK’s largest suppliers of rolled lead have admitted taking part in anti-competitive arrangements and could face fines of more than £11 million, it was announced today.

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Scottish sites return to work

Work can now resume on non-essential Scottish construction sites after First Minister Nicola Sturgeon gave the industry the green light to proceed to the ‘soft start’ phase of its restart plan on Thursday. The move has been welcomed by the sector as a “huge relief”.

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PFI disputes threat as deals near end

Public contracting authorities risk underestimating the time, resources and complexity involved in managing the end of PFI contracts, and many are expecting to face formal disputes, according to the National Audit Office. A collaborative partnership approach will be key to a smooth transition, lawyers urge.

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Unsustainable contracts could be terminated, says Cabinet Office

Eventual exit from supplier relief arrangements applied in response to the Covid-19 crisis should soon start to be mapped out as the government moves into the recovery phase of its response to the pandemic, a new Procurement Policy Note says. Contract variation or even termination may need to be discussed if a contract is no longer seen as relevant or viable, it advises.

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Procurement fraud figures the ‘tip of the iceberg’

Close to a quarter of English councils have reported experiencing cases of fraud and corruption within procurement over a 12 month period, with the true scale of the issue expected to be far worse. Construction’s status as a high risk area is no new thing, one lawyer emphasises.

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News in Brief roundup: 12 June 2020

A tax law specialist has warned that a delay to the introduction of the new domestic reverse VAT charge for construction services due to the impact of Coronavirus on the sector may have an unforeseen consequence on businesses’ cash flow.

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Covid-19 fallout features in Construction Law’s June edition

The latest issue of Construction Law’s print journal is arriving on subscriber’s desks, packed with its unique blend of analysis and comment from leading construction lawyers and barristers on issues surrounding the impact of the Covid-19 pandemic on the industry’s contracts and disputes.

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Construction Law: June 2020

Editor’s comment
Delay and disruption battles loom
As the industry emerges from lockdown Editor Nick Barrett reports that strong advice is being given about an expected outbreak of disputes over delay and disruption costs. Expect future contracts to reflect the new reality, he says.

News
This month’s news roundup focuses on COVID-19 developments including plans to get non essential works back on site in Scotland, the new Corporate Insolvency & Governance Bill introduced to Parliament by the UK Government, and a report from Arcadis which recommends new approaches to contracts in light of the crisis.

Legal terms explained
Harith Canna of Herbert Smith Freehills LLP explains exclusive remedy clauses.

Guest editor
No Construction Act reform in sight after consultation
Guest Editor Nathan McBride of DLA Piper finds interesting insights in the government’s response to its Construction Act consultation, but it’s a case of watch this space for indications of how legislation might develop.

Legislation state of play table
Our regular round up of legislation affecting construction as it passes through the UK legislative process comes from Dentons UK and Middle East LLP. Esther McDermott and Tracey Summerell comment on COVID-19 and its effect on combating modern slavery.

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 focusing on a case which supports an adjudicator’s ability to grant an extension to the timetable; and one providing a reminder of the importance of clearly drafted, unambiguous contract provisions.

Analysis
Climate change – a wind of change for construction?
Vijay Bange of Duane Morris warns that an increasing focus on climate change when pursuing permission for major infrastructure developments might run counter to post COVID-19 pandemic efforts to reflect the world economy.

CL guides
Insuring a construction project
In our latest Construction Law Guide Jessica Tierney of DLA Piper explains the main types of insurance cover used in construction.

Litigation funding
Litigation funding – preserving cash in uncertain times
Construction disputes, particularly over claims and termination, are expected to increase as the costs of COVID-19 begin to bite. Glenn Newberry and Jessica Neuberger of Eversheds Sutherland explain the role that the different types of litigation funding could play.

Disputes
An open and shut case: construction sites in England
Nick Viljoen of HFW explains why parties need to be aware of their contractual options with delays, disruption and additional costs expected as sites re-open using COVID-19 Standard Operating Procedures. Not all costs will be easy to recover, he warns.

Court procedure
Technology keeps the court wheels turning
Barristers Chris Bryden and Georgia Whiting of 4 King’s Bench Walk examine the impact of changes made to court procedure in the COVID-19 age. Early thoughts that complex construction cases would be subject to lengthy adjournment have been laid to rest as judges prove happy to expand the use of technology.

Contracts
Supporting modern methods of construction in housebuilding
Katie Saunders of Trowers & Hamlins LLP analyses whether existing procurement practices and contract forms are up to the task of supporting adoption of modern methods of construction in housebuilding.

Insurance
Underinsurance threatens business survival
Insurance expert John D Wright of JD Risk Associates warns that underinsuring is a widespread and dangerous practice, as many companies are currently finding out when they try to claim for business interruption. Other key types of cover are also neglected, he warns.

Alternative dispute resolution
Mind your “Ps” & “Cs” to avoid disputes
In our latest alternative dispute resolution series article Tracey Summerell of Dentons UK and Middle East LLP suggests successful conflict avoidance will also require a change in mindset for some.