CONSTRUCTION CLAIMS AND DISPUTES: THE RULES
Typical claims on construction & engineering projects:
Typical claims on construction & engineering projects:
- claims a contractor may make (such as loss and expense, extensions of time and for variations)
- claims an employer may make (such as for defective work and liquidated damages).
Building & construction disputes can rapidly become management-time-consuming and expensive.
Claiming, defending and/or counter-claiming
Alternative dispute resolution can be a cost-effective and efficient means of resolving disputes without the need to begin court proceedings, or a formal arbitration or adjudication:
- round-table meetings between the parties;
- mediation;
- arbitration;
- adjudication
- preparation and exchange of experts
- reports;
- meetings of experts.
The Technology and Construction Court (TCC)
The TCC is part of the Queen’s Bench Division of the High Court. It is a specialist court that deals with technology and construction disputes, and other disputes that involve questions or issues that are technically complex.
What claims are assigned to the TCC?
The TCC is a specialist court with a specialist list, heard by a TCC judge. Therefore, TCC claims often involve technically complex issues or questions, which it is appropriate for a specialist judge to hear. Types of claim it may be appropriate to bring in the TCC include:
- Building or other construction disputes.
- Claims for enforcement of adjudicators’ decisions under the Construction Act 1996.
- Claims by and against engineers, architects, surveyors, accountants and other specialist advisors for professional negligence.
- Claims by or against local authorities relating to their statutory duties concerning the development of land or construction of buildings.
- Claims relating to design, supply and installation of computers, software and network systems.
- Claims relating to the quality of goods sold or hired.
- Claims relating to the quality of work done, materials supplied or services provided.
- Claims between landlord and tenant for breach of a repairing covenant (including dilapidations claims).
- Claims between neighbours, owners and occupiers of land in trespass and nuisance.
- Claims relating to the environment, such as pollution claims.
- Claims arising out of fires.
- Complex accounts claims.
- Challenges to an arbitrator’s decision in a construction or engineering dispute, including applications for permission to appeal and appeals.
Reasons for construction contract claims
Construction projects rarely run entirely smoothly: additional works may be requested by the employer or become necessary when things are “discovered” on site; delays may mean the building takes longer to complete; or it may cost more than the parties originally contracted for.
Common claims include:
- A contractor may have a claim against the employer relating to a delay or a change in the works.
- A professional consultant may have a claim against the employer for non-payment of fees or breach of copyright.
- The employer may have a claim against the contractor for a delay to the works or a defect in the works; or a professional consultant for failing to properly design or supervise the works.
Employer claiming against professional consultant
On construction projects, professional consultants often act as the contract administrator (valuing and certifying the works) as well as undertaking a design role.
Generally, on building contracts, the professional consultant administering the contract is an architect; on engineering contracts, it is usually an engineer.
Occasionally, the employer may appoint a project manager or quantity surveyor to administer a contract.
Professional consultants should perform their services in accordance with the implied or express duty of care in their professional appointment.
The professional consultant may be liable to the employer for failing to:
- Design the works in accordance with the professional appointment.
- Supervise the works in accordance with the professional appointment.
- Ensure the contractor built the works in accordance with the building contract.
- Certify the works properly (that is, it is alleged the professional consultant was negligent in certifying the works).
An employer claims its losses caused by a breach of contract or the negligence of a professional consultant as general (unliquidated) damages.
Professional consultant claiming against the employer
- If the employer fails to make payment, the professional consultant may claim for non-payment of fees.
- The parties may dispute whether a particular professional service was included in the fee agreed at the outset, or whether it was extra work.
- The professional consultant will usually retain copyright in the design and its plans and drawings; the employer is typically granted a licence to use these.
- If the employer does not pay the professional consultant, the professional consultant may argue that the employer’s use of the design is in breach of copyright.
