The Law of Construction Disputes (Construction Practice Series)

Description

Now in a fully updated third edition, The Law of Construction Disputes is a leading source of authoritative and detailed information on the whole area of construction law including contracts and their performance, third parties, pursuing claims and dispute resolution. It covers the construction dispute process by analysing the main areas from which disputes arise, up to date case law, and how to effectively deal with construction project disputes once they have arisen. Now including references to the new FIDIC contracts, which were released in 2017, this edition expands on advanced practitioner issues, as well as the emerging law of construction disputes on an international basis and gives the practitioner all the case law needed in one concise volume. The book examines the methods and methodology of construction law, not only for a common law context, but also under other legal systems. Readers will be guided through the various international contract formats governing construction, alongside applicable case law. Additionally, they will be shown the correct contract provisions and forms used to prevent disputes from escalating in order to reach successful conclusions without litigation. Including expert advice and many relevant reference materials, this book is an extremely helpful guide to legal practitioners and construction professionals. Cover Half Title Series Page Title Page Copyright Page Contents The author Preface Acknowledgements Table of cases Table of legislation CHAPTER 1 INTRODUCTION TO CONSTRUCTION DISPUTES Applicable principles of law Common law History Stare decisis Common law countries Civil law The Napoleonic Code Differences between common and civil law Civil law countries Sharia – Islamic law History Hanafi Islamic Sharia Shafi Islamic Sharia Hanbali Islamic Sharia Maliki Islamic Sharia ADR procedure Enforcement of adjudication decisions versus arbitration awards Dispute Review Board decisions Dispute Adjudication Board decisions The form of the Dispute Board decision Particulars as to the Kingdom of Saudi Arabia Particulars as to the Islamic Republic of Iran Dispute Boards under common, civil or Sharia law The historical development of dispute resolution in construction matters The legal development of other dispute resolution methods The engineer/arbitrator as judge The engineer as quasi-arbitrator The development of non-statutory adjudication The advent of Dispute Boards in England Extension to international cases Specific regional differences and methods Germany France Forms of standard construction contacts Use of form contracts Standard form provisions Methods of construction contracting The traditional method The design-build method The management contracting method The construction manager method Other methods Contractual operation and payment formats The traditional lump sum or fixed price contract The guaranteed maximum price contract The remeasurement type of contract The cost reimbursement or cost plus fee contract Target cost contracts CHAPTER 2 THE CONSTRUCTION CONTRACT Formation Defining a contract Offer and acceptance Implied agreements Capacity Consideration Intent to be legally bound Privity of contract Oral contracts Letters of intent Other contract issues – battle of the forms and related difficulties The construction tender Unilateral versus bilateral contracts Uncertainty Conditions as terms of a contract Implied terms Terms implied in fact Misrepresentation Distinctions Express false representations Implied misrepresentations Negligent misrepresentations Innocent misrepresentations Misstatements of the law versus fact Mistake Unilateral mistake Mutual mistake Common mistake Mistake versus frustration versus impossibility CHAPTER 3 DESIGN DISPUTES AND LIABILITY Design professionals The design professional: architect/engineer’s duty – tort versus contract Fitness for purpose liability Reasonable skill and care Concurrent negligence and contract duty Negligence generally Duty to warn of retrospective danger Duty to others Purely economic losses Miscellaneous matters: personal injury, latent defects and subsequent occupiers Other issues The knowledge of others Matters other than design New, novel and strict design standards Liability for design of others CHAPTER 4 SITE CONDITIONS The site Right to access Possession by whom? Does the contractor have a licence to enter the site? Access and possession Site access after completion Site conditions Unforeseen ground conditions Contract provisions for unexpected ground conditions Misrepresentation of the site conditions The site under the Housing Grants Act Employer responsibility regarding possession CHAPTER 5 THE SUBCONTRACTOR Types of subcontract Relations with the contractor Employer insolvency and payments Default by subcontractor Delay issues Defect issues Problems with nominated subcontractors Relations with employer No privity The Contracts (Rights of Third Parties) Act 1999 Liability in tort Relations with architect and engineer CHAPTER 6 DEFENCES TO CONSTRUCTION DISPUTES Force majeure Is the contract terminated? Acts of God The purpose of force majeure clauses – historically and internationally Typical force majeure clause usage The necessary requirements for force majeure When does force majeure commence? The duration of the condition When should notice be given Force majeure’s effect Frustration CHAPTER 7 ISSUES REGARDING CONTRACTORS’ RIGHTS AND OBLIGATIONS UNDER STANDARD FORM AGREEMENTS Design-build form contracts Particular provisions: contractor to scrutinise employer’s requirements for errors Extension of time clauses EOT “sweeping-up” clauses The other major forms of contract The JCT forms of contract JCT 98 Standard Form of Building Contract (JCT 98 SFBC) The changes made in the SBC05 Payment Insurance issues Commencement, progress and completion Warranties/third-party rights Termination Dispute resolution The ICE conditions of contract Measurement Version 7th Edition ICE Design and Construct contract ICE Minor Works contract Time and cost issues under the Measurement Version, Design and Construct, Minor Works The Measurement Version The Design and Construct Version The Minor Works Contract The NEC3 – the New Engineering Contract Engineering and Construction Contract – NEC ECC and the new NEC 4 changes Overview – NEC3 Some important provisions Clarifications Adjudication Capping contractor liability The risk register Prevention Clause 19 The concept of Key Dates Design liability Payment for defective work Overview – NEC4 The FIDIC Forms of Contract The three main FIDIC Forms of Contract The proper form Employer design of the project Contractor design of the project Contractor designs and employer supervises Contractor designs, procures and builds Contractor designs, procures, builds and operates Who has the risk? Common issues between the forms The role of the engineer Contractor incentives Variations Contractor’s rights and obligations Rights Obligations Additional obligations and issues Termination issues Termination for convenience Impossibility of performance Force majeure FIDIC 2017 edition changes The contractor The employer Unforeseen conditions The Red and Yellow Books The Silver Book Damages Delay/damage claims by the employer Damage claims by the contractor CHAPTER 8 TERMINATION OF CONTRACT Termination versus determination Common law repudiation versus determination Can suspension be repudiation? Anticipatory repudiation A repudiation need not be accepted Rescission Release Accord and satisfaction Waiver and promissory estoppel CHAPTER 9 THE CERTIFICATION PROCESS Certificates Certificate requirements Errors Interim certificates Impartiality of the certifier Certifier liability History Variations Is it a variation or a separate contract? Implied variations Ordering variations Failure to order a variation Removing work What is the basis for payment and value of the variation? Value Standard methods of measurement Errors Final certificates Final Account Statements CHAPTER 10 TYPES OF CLAIM Claims for money The issue of causation Contribution Money damages but at what cost Reasonableness Contract versus tort damages Claims for performance Liquidated damages and claims for extensions of time Delay versus disruption Extensions of time The standard forms Who determines the extension Float Concurrent delay Diminution in value Abatement versus set-off CHAPTER 11 COLLATERAL WARRANTIES Collateral warranty provisions The Contracts (Rights of Third Parties) Act 1999 Enforcing variation and rescission of contract Defences Defence 1 Defence 2 Defence 3 The promisee’s enforcement of the contract Opting out of the Act CHAPTER 12 NON-CONTRACT LIABILITY Negligence The “Threefold Test” The “Assumption of Responsibility Test” The “Incremental Test” The “Holistic Test” Vicarious liability Nuisance Limiting factors Strict liability in nuisance – the rule in Rylands vFletcher Trespass versus nuisance Encroachment CHAPTER 13 TIME AT LARGE AND TIME-BAR CLAUSES Time at large Time-barred claims CHAPTER 14 DISPUTE RESOLUTION Conventional model Litigation versus arbitration versus mediation Arbitration The Arbitration Act 1996 The arbitration process The arbitrator The award Arbitration variations Mediation during the litigation/arbitration process Refusing to mediate Enforceability of ADR agreements and mediation settlement agreements Withdrawing from mediation Refusing to mediate – no cost consequences Adjudication Mandatory provisions The process under the Act The Scheme for Construction Contracts The Act’s main areas – Is there a dispute? Does the dispute arise under a construction contract? Does a contract have to be in writing within the meaning of section 107? The process Procedures under the Scheme Notice of adjudication Appointment of an adjudicator The referral notice Adjudicator’s powers and duties Changes to the Housing Grants Act Dispute Boards What is a Dispute Board? What makes a Dispute Board unique? What can be achieved by using a Dispute Board? Non-binding recommendations Interim-binding decisions History of Dispute Boards The World Bank Harmonised contract conditions Growth of Dispute Boards An overview — composition of Dispute Boards and their operation Appointment and membership The importance of early appointment and of regular site visits Routine operations Informal operations Dispute Board procedures Dispute Review Board costs Why Dispute Boards work International aspects CHAPTER 15 KEY ISSUES IN DISPUTE RESOLUTION Agreements Disclosure E-disclosure The Chartered Institute of Arbitrators Protocol for E-disclosure in Arbitration Confidentiality Enforcement of foreign awards in the UK Serial adjudication decisions Adjudication conundrum Election Set-off Arbitration of Dispute Board decisions Notice of dissatisfaction Amicable settlement Arbitration New developments The award Recent developments The trend Persero No 2 The 2011 arbitration APPENDICES Appendix 1: Glossary of Construction Terms Appendix 2: Housing Grants, Construction and Regeneration Act 1996 Appendix 3: The Scheme for Construction Contracts (England and Wales) Regulations 1998 Appendix 4: Contracts (Rights of Third Parties) Act 1999 Appendix 5: Dispute Board Provisions Under the FIDIC Red Book 1999 Appendix 5a: Dispute Board Provisions Under the FIDIC Red Book 2017 Appendix 6: Dispute Board Provisions Under the FIDIC Yellow Book 1999 Appendix 6a: Dispute Board Provisions Under the FIDIC Yellow Book 2017 Appendix 7: Dispute Board Provisions Under the FIDIC Yellow Book 2017 Appendix 7a: Dispute Board Provisions Under the FIDIC Silver Book 2017 Appendix 8: ICC Dispute Board Rules Appendix 9: The Dispute Board Federation Dispute Adjudication Board Ad Hoc Rules for Use in Independently Administered Dispute Board Matters Appendix 10: The Defective Premises Act 1972 Appendix 11: Unfair Contract Terms Act 1977 Appendix 12: Torts (Interference with Goods) Act 1977 Appendix 13: Sale of Goods Act 1979 Appendix 14: Limitations Act 1980 Appendix 15: Supply of Goods and Services Act 1982 Appendix 16: Latent Damage Act 1986 Links to useful websites Index