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Construction Risks Newsletter September 2023

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Published 28 September 2023

Overview

Welcome to the September 2023 issue of the DAC Beachcroft Construction Risks Newsletter

Building Safety is again at the forefront of this quarter's newsletter.  We have provided a roundup of the latest guidance and legislation issued under the BSA since our last update in June. We also provide a case review of the highly anticipated Court of Appeal decision in URS Corporation Ltd v BDW Trading Ltd [2023] EWCA Civ 772, which will be of interest to anyone considering claims for building safety defects.  We then look at the decision of the First Tier Tribunal and the issues taken into account when making the first Remediation Order under the BSA legislation.

Next we look at the latest decisions from the TCC regarding adjudication enforcement. The adjudicator's jurisdiction in serial adjudications is considered in Sudlows; an (unsuccessful) attempt to demonstrate breach of natural justice due to volume of information is made in Home Group; and the importance of paying the sums due as a result of a smash and grab adjudication before commencing a true value adjudication is made unequivocally clear in Henry Construction

We also review the circumstances where a party can benefit from the uplift when beating a Part 36 offer, guidance on termination provisions under standard form construction contracts and when a cause of action in the tort of negligence for economic loss accrues for limitation purposes.

All in all, it's been a busy summer.

The latest developments under the Building Safety Act 2022 ("BSA")

 

The following seeks to provide a round-up of the guidance and legislation issued under the BSA since our last update in June.

 

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Court of Appeal Judgement in URS Corporation Ltd v BDW Trading Ltd

The claimant, BDW, a well-known developer, instructed URS, a structural engineer, to design numerous blocks of flats across the UK. Serious structural defects were found in late 2019 in one of the developments designed by URS. As a consequence, BDW undertook a wholesale review of the structural design of all their URS designed developments.

 

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The First Remediation Order: Waite & Ors v Kedai Limited 2023

 

Following the enactment of the Building Safety Act 2022 ("BSA"), the First Tier Tribunal ("FTT") recently granted the first Remediation Order in favour of leaseholders, against a freeholder/landlord in relation to external fire-safety issues. The decision of Waite & others v Kedai Ltd provides important insight into how such proceedings may play out before the FTT.

 

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'Same Dispute' Challenges in Adjudication

The recent Court of Appeal judgment in Sudlows Ltd v Global Switch Estates 1 Ltd [2023] EWCA Civ 813 provides guidance to adjudicators and practitioners alike. The Court also considered circumstances in which fresh evidence does not necessarily constitute a new dispute.

 

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Don't Delay; Review Today - Home Group Ltd v MPS Housing Ltd [2023] EWHC 1946 (TCC)

 

This case relates to MPS Housing Ltd's ("MPS") repudiatory breach of a maintenance contract (the "Contract") it had with Home Group Limited ("HGL") for carrying out maintenance and repairs to HGL's property within the South-East of England and the subsequent adjudication relating to HGL's losses.

 

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Henry Construction Projects Limited -v- Alu-Fix (UK) Limited

Henry Construction Projects ("Henry Construction"), the contractor appointed to develop a boutique hotel in Central London, employed Alu-Fix as a sub-contractor. The Sub-Contract was terminated in November 2022, and Alu-Fix subsequently submitted an application for payment in the sum of around £257,000 which was due to paid on 13 December 2022.

 

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Lessons from Sleaford Building Services Ltd v Isoplus Piping Systems Ltd [2023] EWHC 1643 (TCC) – there must be a genuine attempt to settle

This case concerned the application of Isoplus Piping Systems Ltd ("Isoplus") against Sleaford Building Services Ltd ("Sleaford") for i) an uplift to the amount in the adjudicator's decision dated 23 December 2022 ("the Decision") pursuant to CPR 36.17(4) following rejection of a Part 36 offer; and ii) indemnity costs for enforcing the Decision.

 

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Guidance from the TCC on termination under the JCT Minor Works Contract

 

In Bellis v Sky House Construction Ltd [2023] EWHC 1473 (TCC) the Court was asked to consider whether the employer had properly terminated the contract

 

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When a cause of action in the tort of negligence for economic loss accrues for limitation purposes

 

On 24 July 2023, the TCC gave judgement on an interim application in the matter of Vinci Construction UK Limited v (1) Eastwood and Partners (Consulting Engineers) Ltd (2) Snowden Seamless Floors Ltd v GHW Consulting Engineers Ltd , which considered the principles set out in the recent Court of Appeal decision in URS Corp Ltd v BDW Trading Ltd [2023] EWCA Civ 189, regarding this issue.

 

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