Foreword by the Rt Hon Lord Hope of Craighead KT xiii
Preface xv
1 Construction Contracts in General 1
1.1 Introduction 1
1.2 Definition of a construction contract 1
1.3 Parties involved in a construction project 5
1.4 Types of construction contract 15
1.5 The SBCC forms of building contract 23
1.6 The NEC3 forms of contract 25
1.7 Building Information Modelling (BIM) 27
1.8 Soft Landings 29
2 Procurement 32
2.1 Introduction 32
2.2 The EU public procurement regime and EU economic and legal principles 33
2.3 Beyond the EU 35
2.4 Conditions for application of the procurement rules 36
2.5 Who must comply with the Regulations? 36
2.6 Treatment of a proposed contract as a works contract, supply contract or a services contract 37
2.7 What are the relevant financial thresholds? 40
2.8 Is there an applicable exclusion? 41
2.9 Types of procurement procedure 42
2.10 The open procedure 42
2.11 The restricted procedure 43
2.12 The negotiated procedure with advertisement 46
2.13 The competitive dialogue procedure 49
2.14 Awarding the contract 53
2.15 The Alcatel mandatory standstill period 54
2.16 The use of framework agreements in public procurement 56
2.17 Remedies against contracting authorities (bidder grievances and complaints) 57
2.18 Awarding low-value contracts fairly 61
2.19 Forthcoming changes in the Procurement law landscape 62
3 Entering into a Construction Contract 64
3.1 Introduction 64
3.2 Essentials of written and oral contracts 64
3.3 Capacity to contract 71
3.4 Implied terms 73
3.5 Letters of intent 78
3.6 Incorporation of terms by reference to another document 80
3.7 Contract interpretation 83
3.8 Signing a building contract 84
4 Employers’ Obligations 87
4.1 Introduction 87
4.2 Possession of the site 88
4.3 Administration 92
4.4 Information and instructions 95
4.5 Variations 97
4.6 Other obligations 102
5 Contractors’ Obligations 103
5.1 Introduction 103
5.2 Completing the works 103
5.3 The quality of the work 118
5.4 Defective work 128
5.5 Progress of the works 131
5.6 Insurance and indemnity 138
5.7 The Joint Fire Code 139
5.8 Health and safety 140
6 Time 141
6.1 Introduction 141
6.2 Commencement of the works 141
6.3 Time of the essence 142
6.4 Progress of the works 142
6.5 Adjustment of the Completion Date and extension of time for completion 143
6.6 Partial possession, sectional completion and acceleration 152
6.7 Completion of the works 153
6.8 Damages for late completion 154
6.9 Liquidated damages 155
6.10 The SBC/DB 158
6.11 The NEC3 159
7 Certification 168
7.1 Introduction 168
7.2 Formal requirements of certificates 168
7.3 Interim certificates 171
7.4 Final certificates 176
7.5 Other certificates 180
7.6 Roles and duties of certifiers 183
8 Payment 188
8.1 Contractual payment 188
8.2 Adjustment of the contract price 206
8.3 Loss and expense 215
8.4 Quantum meruit 220
8.5 Quantum lucratus 222
8.6 Contractual retention 224
8.7 Project bank accounts (PBA) 227
9 Ending a Construction Contract 229
9.1 Introduction 229
9.2 Frustration and impossibility 229
9.3 Force majeure 232
9.4 Termination 233
9.5 Repudiation and rescission 242
9.6 Death and illness 243
9.7 Illegality 244
9.8 Insolvency 245
9.9 Prescription 248
10 Remedies 254
10.1 Introduction 254
10.2 Rescission 255
10.3 Specific implement 256
10.4 Damages for breach of contract 257
10.5 Finance charges 261
10.6 Interest 263
10.7 Interdict 267
10.8 Withholding payment 267
10.9 Suspending performance 269
10.10 Delictual claims 271
11 Sub-contractors and Suppliers 275
11.1 Introduction 275
11.2 SBCC Standard Sub-Contracts 275
11.3 NEC3 Standard Sub-Contracts 276
11.4 Nominated and domestic sub-contractors 276
11.5 Named and specialist Sub-Contractors 277
11.6 Direct payments to sub-contractors 279
11.7 Privity of contract 280
11.8 Relationship between main and sub-contracts 282
11.9 Restrictions on sub-contracting 283
11.10 Main contractor’s discount 284
11.11 Suppliers 285
11.12 Retention of title clauses 285
11.13 Supply of goods by sub-contractors 287
11.14 Adequate mechanism for payment 288
12 Assignation, Delegation and Novation 290
12.1 Introduction 290
12.2 Common law 291
12.3 Effect of assignation upon claims 292
12.4 Delectus personae 294
12.5 Assignation under the SBC and the SBC/DB 294
12.6 Assignation under the NEC3 295
12.7 Delegation 295
12.8 Novation 296
13 Rights forThird Parties 300
13.1 General 300
13.2 Collateral warranties 300
13.3 Typical clauses 303
13.4 Effects of the 1996 Act on collateral warranties 310
13.5 Third party rights schedule 311
13.6 Assignation 313
14 Insurance 314
14.1 Insurance: General principles 314
14.2 Insurance under the SBC and the SBC/DB 318
14.3 Insurance under the NEC3 323
14.4 Professional indemnity insurance 325
14.5 Latent defects insurance 327
14.6 Project insurance 327
15 Litigation 329
15.1 Introduction 329
15.2 The litigation process 329
16 Adjudication 338
16.1 Introduction 338
16.2 The scope of Part II of the 1996 Act, as amended by the 2009 Act 338
16.3 The notice of adjudication 340
16.4 Appointment of the adjudicator 341
16.5 The referral notice 342
16.6 Conduct of the adjudication 342
16.7 The decision 347
16.8 Adjudicator’s fees and costs/expenses of the parties 348
16.9 Liability of the adjudicator 351
16.10 Enforcement proceedings 351
16.11 Proceedings following adjudication 373
16.12 Human rights 373
16.13 Adjudication in PPP contracts 375
17 Arbitration 377
17.1 Introduction 377
17.2 The Arbitration (Scotland) Act 2010 380
18 Other Forms of Dispute Resolution 396
18.1 Mediation 396
18.2 Settlement agreements 408
18.3 Expert determination 414
18.4 Early neutral evaluation 418
18.5 Senior management review 419
18.6 Dispute boards 422
19 Tax 426
19.1 Value Added Tax (VAT) 426
19.2 The Construction Industry Scheme 433
20 Health and Safety 437
20.1 Introduction 437
20.2 Common law 437
20.3 Health and Safety atWork etc. Act 1974 438
20.4 The Construction (Design and Management) Regulations 2007 444
20.5 The SBC and the SBC/DB provisions 455
20.6 The NEC3 provisions 456
21 RegulatoryMatters: Competition in Construction 457
21.1 Competition law in the UK: Introduction 457
21.2 Competition law: Overview 457
21.3 Penalties 458
21.4 The Chapter I prohibition 459
21.5 The Roofing and English Construction cases 462
21.6 The cartel offence 464
21.7 Leniency 465
21.8 The Chapter II prohibition 466
21.9 Summary 467
22 RegulatoryMatters: The Bribery Act 2010 468
22.1 Compliance:The Bribery Act 2010 468
22.2 The Bribery Act 2010: The offences 469
22.3 The Bribery Act 2010: The defence 474
22.4 Facilitation payments 477
22.5 Consequences of offences under the Bribery Act 478
22.6 Prosecution under the Bribery Act 482
22.7 Construction industry risk profile 482
22.8 The SBC, the SBC/DB, the NEC3 and the Bribery Act 484
23 Guarantees and Bonds 486
23.1 Guarantees 486
23.2 Bonds 491
Tables of Cases 497
Table of Statutes 522
Table of Statutory Instruments 529
Table of References 538
