Construction Risks - August 2018

Construction Risks - August 2018's Tags

Tags related to this article

Construction Risks - August 2018

Published 23 August 2018

DAC Beachcroft's Construction Risk Newsletter features topical issues in construction
This has been a busy period for the Court, with numerous important cases and potential legislation. There has been the widely reported case of Grove v S&T which appears to reset the position on "smash and grab" adjudications, together with reminders of the difficulties when terminating contracts and independence of experts. There have been further attempts to introduce legislation with regard to Retentions and cost reduction schemes to limit disclosure in High Court actions.  

Beware of the back firing (hired) gun

In the recent decision of Bank of Ireland v Watts Group PLC, Mr Justice Coulson considered the duty of care that a quantity surveyor (Watts) owed when providing a report to a bank (BOI) to be used as part of its lending decision. Read more

Be careful what you sign up to…

In the recent decision of Triumph v Primus, shortly before his appointment to the Court of Appeal, Mr Justice Coulson ordered, on application by the Defendants, that the Claimants carry out a manual review of a statistical sample of 25% of 220,000 documents (that should have previously been reviewed) within 3 weeks. Read more

Oral Variations to contracts

On the facts, MWB occupied premises managed by Rock Advertising under a written license agreement. The agreement contained a clause providing that all variations to the licence must be made in writing. The issue to be determined was whether a purported oral variation was effective. Read more

Damages for wrongful termination

Andrew Barlett QC, held that Redbourn were not entitled to any payment of damages for the wrongful termination, as Fairgate would have been permitted to terminate the appointment in circumstances where a project was not financially viable or the proposed project was unrealistic. Read more

The end of "smash and grab" adjudications?

It was held that the employer was entitled to refer a dispute about the value of the contractor's interim application for payment to adjudication, despite that a pay less notice was previously held (in a separate adjudication) to be invalid. The court held that the employer's notice was, in fact, valid and held that the employer can refer the 'true' value of an interim payment to adjudication, regardless of whether the appropriate notices had been served. Read more

"Thickening" claims

A claimant may issue a claim for particularised overhead costs where it can prove that the relevant head office overheads had "thickened", i.e. necessarily become more expensive, as a direct result of a defendant's breach. A claimant may not, however, claim for overheads where they are calculated as a proportion of losses otherwise proved. Read more

Construction (Retention Deposit Schemes) Bill 2017-19

The cash-flow problems retention can cause to contractors and sub-contractors by late, or worse, non-payment, are exacerbated where they are required to commence proceedings for the retention monies to be returned. Given that retentions often represent 5% of the overall certified sums, they are often not insignificant sums. Read more

Disclosure Pilot Scheme in the Business and Property Courts

To combat widespread concerns that the cost of disclosure remains disproportionately high, a radical reform of the procedural step of disclosure of documents has been proposed. A mandatory two year pilot scheme is set, subject to ministerial approval, to be introduced in the Business and Property Courts on 1 January 2019. Read more

Cash Retentions – do they really help?

In addition to learning of the changes being brought about in respect of cash retentions under Construction Contracts, you may also be interested in our previous discussion of the merits of cash retentions.
Read more

First CPS Prosecution for failing to prevent Bribery

An obligation to take steps to prevent bribery is becoming commonplace in construction contracts. Those involved in the construction industry must take heed, therefore, of the CPS' first prosecution for failing to prevent Bribery. Read more

Mediate or face cost consequences – is this still the court's approach

Given the contentious nature of the construction industry and the propensity for large disputes to end up in Court litigation (as opposed to adjudication) you may be interested to read this article as to whether it is still the case that cost consequences will be imposed on parties who refuse (for unjust reasons) to mediate. Read more

Enforcement action in the Construction Industry

In 2017 there was a significant increase in the number of prosecutions for breaches under the Construction (Design and Management) Regulations 2015. Those involved in construction will discover in this article the overall number of prosecutions in 2017 and which duty holders are prosecuted the most frequently. Read more

Sending Health and Safety Sentencing into a spin?

In March 2017 Whirlpool UK Appliances Limited was fined £700,000 following the death of one of its contractors. The Company pleaded guilty to a breach of Section 3(1) of the Health and Safety at Work etc. Act 1974, which places an obligation on employers to ensure that, so far as is reasonably practicable, those that are not in their employment are not exposed to risks to their health or safety.

The fine was appealed and ultimately reduced to £300,000. For more information about the factors considered during the appeal and how this may have an impact on future cases, particularly in terms of large and very large organisations where low profitability may be a factor. Read more

Construction Focus: Worker Status Developments

As 2017 drew to a close and the door to 2018 opened, the issue of worker status remains a key issue, particularly for those employers who engage an atypical workforce: employers in the construction sector and the so-called 'gig-economy' being two clear examples.

Related to the issue of worker status, holiday pay has also been back in focus as a result of a European judgment about a worker who had been mis-classified as self-employed. This case re-opens the door to holiday claims going back years. Read more


Mark Roach

Mark Roach

London - Walbrook

+44 (0)20 7894 6314

Key Contacts

Mark Roach

Mark Roach

London - Walbrook

+44 (0)20 7894 6314

< Back to articles