Construction Forecast 2014

Ruth Wilkinson and Louise Shiels forecast what 2014 has in store, from a legal perspective, for the construction industry.

All the signs are that 2014 should be a positive year for the construction industry with construction outputs scheduled to grow - that gets us to thinking about what this year may have in store from a legal perspective.

We can look forward to a whole host of changes in public procurement, introduction of new contract forms and seeing the impact of the reforms to the civil procedure rules on construction disputes. On a day to day basis will we see an increased focus on net contribution clauses by consultants and adjudications based on collateral warranties? We look forward to an interesting year ahead ...

Procurement

In the sphere of public procurement so many changes lie ahead in 2014. How are contractors and public sector bodies supposed to keep up? Not only do we have the EU directives (the revised public sector directive, revised utilities directive and new concessions directive) being updated but we have the different parts of the UK introducing their own changes including, for example, the Welsh and Scottish Blacklisting guidance and the Scottish Government introducing its own statutory rules for below threshold contracts.

New contract forms

A new JCT suite is planned for 2014/2015 including a practice note on BIM, revisions to PBA provisions and a new target cost contract to possibly rival NEC3. FIDIC is also due to revise their contracts in the spring and LOGIC is in the progress of updating their suite of contracts.

Court Reforms*

In April 2013 there were significant reforms introduced to the civil procedure rules. These reforms included the introduction of cost budgeting affecting claims under £2 million meaning, in practice, more paperwork and significant consequences for non-compliance. The full effect of these reforms has yet to be felt but indications from the courts so far are that the reforms are being applied vigorously. Mr Justice Ramsey in the Technology and Construction Court is currently carrying out a review of progress - results expected April 2014, so a clearer picture is likely to emerge as to the practical impact of these reforms. In the meantime, there is speculation that there may be a return to domestic arbitration to avoid the impact of these new reforms.

Collateral Warranties

Collateral warranties will remain in the spotlight - of that we have no doubt. What is interesting is the increasing...