Construction Bill Gets Go Ahead In Queen's Speech

The Draft Construction Contracts Bill, published by the DBERR

(Department for Business, Enterprise and Regulatory Reform) earlier

this year, has been confirmed as part of the Government's

legislative programme for the current parliamentary session.

The new legislation will apply to Scotland, England and

Wales. It will make some fundamental changes to the Housing

Grants, Construction and Regeneration Act 1996, with the stated aim

of improving the operation of construction contracts and

encouraging parties to resolve disputes by adjudication.

The most significant change is the abolition of the requirement

for contracts to be in writing in order for the 1996 Act to

apply. Oral contracts or oral / partly written contracts will

now come within the scope of the 1996 Act provided the adjudication

provisions are "evidenced in writing."

Other key changes include:

Amendments To The Payment Provisions

The simplification of payment notice provisions.

Amendments To The Adjudication Provisions

Slip Rule – (Scotland Only).

Contracts must include provisions which allow the adjudicator

power to correct clerical or typographical errors arising by

accident or omission in his or her decision after it has been

issued.

Costs of Adjudication.

Any provision in the contract dealing with the allocation of

costs of the adjudication is ineffective unless it is made in

writing after the appointment of the adjudicator.

Where the contract provides for payment of costs (other than

the fees and expenses of the adjudicator) by one party, the

adjudicator may determine that such provision is unreasonable and

may disallow certain costs on that basis.

Provision is made for parties to be liable on a joint and

several basis to pay the adjudicator such reasonable amount as he

may determine for fees (for work reasonably undertaken) and

expenses reasonably incurred.

Disputes as to a reasonable amount or whether work is

reasonably undertaken and expenses reasonably incurred to be

decided by the court.

Other Changes

Interim third party payment decisions are ineffective where

expressed to be "binding" – to ensure that all

disputes about interim or stage payments can be referred to

adjudication.

Improvement of the right...