Reports from the courts: April 2011

Professor Michael Furmston of Bristol University rounds up the court decisions of most interest to construction, including the first appeal court ruling involving a letter of intent.

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New government, new priorities?

In 2010 a number of key pieces of legislation was either passed or unveiled with the aim of them coming into force in 2011. However over three months into 2011, and it seems that these pieces of legislation just seem to be suffering delay after delay.

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State of play table: 159

This table, prepared by Clyde & Co, provides a regularly amended guide to new and proposed legislation that will affect the construction industry. In addition to EU Directives and UK legislation, the table includes notes highlighting discussion papers issued by both government and non-government organisations, and commentary on the latest developments.

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‘Let it snow, let it snow, let it snow…’

Severe weather could be more of a feature in the UK than in the recent past if the gloomier climate forecasts are correct. If so, Guest Editor Louise Shiels of Dundas & Wilson advises keeping a weather eye on contracts.

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Legal terms explained: Defects Liability Periods – how they work

Defects Liability Periods or ‘Rectification’ provisions allow a contractor to return to site to remedy defects arising in the works for a certain period after practical completion, typically 12 months.

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News in brief: April 2011

The House of Commons Treasury Select Committee has launched an inquiry into the future of the Private Finance Initiative which will examine the strengths and weaknesses of different public procurement methods. The inquiry will build on previous inquiries by the National Audit Office and the House of Lords Economic Affairs Committee. Submissions should be made by 28 April 2011.

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PFI pilot to cut costs

A pilot project has been launched at an £835m hospital project in Essex to identify the scope for savings in operational Private Finance Initiative contracts. The contract for the Queen’s Hospital in Romford is being examined by a team of legal, technical and commercial advisers to identify savings that can be applied across the full portfolio of PFI contracts.

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Cover pricing fines slashed

Fines imposed against six construction companies that fell foul of the Office of Fair Trading’s (OFT) investigation into allegations of cover pricing have been slashed by 90 per cent after the Competition Appeal Tribunal agreed that they were excessive and discriminatory.

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Budget seeks cost cuts

Public sector construction and infrastructure procurement are to be reformed under government plans to cut costs by 20 per cent. A series of reform measures are to be rolled out starting in May, according to the Government Plan for Growth document that was published along with the 23 March Budget.

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No sympathy for the OFT

The Office of Fair Trading could expect no sympathy from the construction industry over the headline in the Times that announced the unprecedented cuts in fines imposed on six of the contractors found guilty of cover pricing: ‘Hammering for OFT as builder’s fines are slashed’ it thundered.

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