The Construction and Engineering Pre-Action Protocol has applied to all claims against construction professionals since October 2000. Although generally speaking the Protocol has worked well, concerns had been raised about the time it was taking for parties to comply with the procedure and also the costs incurred in the procedure itself. As a result, the Protocol has been revised and the amended Protocol will apply to all disputes commenced after 6 April 2007.
The new Protocol has the following key amendments:
The time for the defendant’s response, which could previously be extended by agreement to four months, has been reduced to three months.
The pre-action meeting, which was previously to take place “as soon as possible” is now to take place within 28 days of the defendant’s response.
The Protocol also has a new clause 1.5 to address the issue of proportionality, which stresses that costs should be proportionate to the complexity of the case and the amount of money at stake. Parties are not expected to marshall and disclose all supporting details and evidence that would be used in litigation.
Clause 1.5 would appear to be intended to counter the problems faced by a defendant who may incur substantial wasted costs in defending allegations that a claimant then does not pursue. It is unlikely that the courts will overrule the decision in Ian McGlinn v Waltham Contractors , in which Coulson HHJ held that costs incurred by a defendant at the pre-action protocol stage to persuade a successfully claimant to abandon a claim could not be recovered in any subsequent proceedings, unless the defendant could establish that the claimant’s conduct had been wholly unreasonable. In the circumstances, defendants will clearly be interested to limit their costs of defending a claim at the pre-action protocol stage, so far as is possible.
The Protocol also requires the parties to consider whether some form of alternative dispute resolution is more suitable than litigation. There is, however, an express statement that no party “can or should” be forced to mediate or enter into any form of alternative dispute resolution.