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Fitness for Purpose vs Reasonable Skill and Care image

In construction contracts nowadays it has become fairly common practice for the drafters to include express obligations and undertakings from contractors in respect of the design or suitability. In many cases these obligations and their implications are not entirely understood by the parties, giving rise to disputes in situations where the contract also has express obligations to perform or produce works in line with specific standards or specifications. Two very interesting cases that I have been discussing with clients offline recently has prompted me to produce an article. The cases in question were: MT Højgaard A/s v E.ON Climate And Renewables & Ors [2014] EWHC 1088 (TCC) Mw High Tech Projects UK Ltd v Haase Environmental Consulting GmbH [2015] EWHC ...

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Building Relationships image

As an industry we shape the built environment in many ways. We enhance society by creating buildings and structures that make life better. When you think about it, our industry is responsible for one of the Human Race’s basic necessities, shelter. I don’t know how you feel, but I feel an immense sense of pride to work in our industry. To be totally candid, I love my work and I especially enjoy helping people and businesses get better, making more profits, while effectively managing conflict and risks. One thing I can never understand though, is for an industry that builds the very structures that we humans so heavily rely upon, it appears to be largely unable to build meaningful and mutually ...

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A marriage made in heaven…. image

I read with great interest in today’s Construction News that there is talk of exploring a merger with the NSCC and UKCG. For those of you who don’t know who these organisations are allow me to explain. NSCC is the National Specialist Contractors’ Council and the UKCG is the UK Contractors Group. Simply put Specialist Subcontractors and (primarily) Main Contractors respectively. As somebody who advises both main and subcontractors, normally when in a dispute, I am well versed in the “war of attrition” that has been going on for some time in our industry. My own business was in fact established to help bring about a peace or as I call it “restore balance”, so I can honestly say that I believe this ...

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Never judge a book by it’s cover… image

….Friday humour, with a very simple lesson too…. A young boy enters a barber shop and the barber whispers to his customer, “This is the dumbest kid in the world. Watch while I prove it to you.” The barber puts a dollar bill in one hand and two quarters in the other, then calls the boy over and asks, “Which do you want, son?” The boy takes the quarters and leaves. “What did I tell you?” said the barber. “That kid never learns!” Later, when the customer leaves, he sees the same young boy coming out of the ice cream store. “Hey, son! May I ask you a question? Why did you take the quarters instead of the dollar bill?” The boy licked his ...

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Cherry Picking Adjudicators can be bad for your wealth…. image

The following is a cautionary tale on how not to complete a form for the appointment of an Adjudicator. In the case of Eurocom Ltd v Siemens Plc [2014] EWHC 3710 (TCC) (Contractor vs Subcontractor), the courts found that the process for nominating an Adjudicator had been seriously undermined. Background to the case In early 2011, Siemens, acting as the Contractor, employed Eurocom as the Subcontractor to install communications systems on two London Underground stations. Sadly a dispute arose. Fast forward to August 2012 where the Contractor has now terminated the Subcontractors employment under the sub-contract. Adjudication Number 1 Around the same time as the termination, the Subcontractor raised an adjudication. The decision by the adjudicator meant that the Subcontractor ...

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Pay Less Notices – Employer top of Santa’s Naughty List.. image

Christmas has come early for one Contractor, albeit they may have to hand back some of their gifts…… In the case of ISG Construction Limited v Seevic College [2014] EWHC 4007 (TCC) (Contractor vs Employer), the Courts have made a very useful contribution to recent case law and at the same time given some much needed clarity to the issue of Pay Less Notices. In this matter the court refused an action to enforce an adjudicator’s decision valuing an interim payment application. The reason for this refusal was that the adjudicator had already issued a separate decision for a sum owed by the Employer to the Contractor, in the same application for payment. The reason being that the Employer had failed to serve ...

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Collateral Warranties are not just for Christmas…. image

The Technology and Construction Court (TCC) handed down a decision in the recent case of Liberty Mercian Ltd vs Cuddy Civil Engineering (Employer vs Contractor). The decision sends a very important warning to Contractors that Collateral Warranties must be taken seriously and hints that the court will go the extra mile to enforce collateral warranties, even in situations where a party has already endeavoured to do so. Background. This latest decision follows a series of litigations between the parties. Last year in its previous decision, the TCC found that: an obligation on a third party to provide a collateral warranty under a contract survives termination of that contract, put simply that the obligation remains even if the contract is terminated; and an order to ...

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