Expert determination – jurisdiction and waiver of non-waiver clauses

The recent case of ZVI Construction Co LLC v Notre Dame University (USA) in England (2016) confirms that, as with adjudication, if a party actively participates in an expert determination then he may expressly or impliedly confer jurisdiction on an expert where there would otherwise be none. It will be a question of fact as to whether there has been “a clear submission to the jurisdiction” of the expert. Where a contract includes an expert determination clause, parties must consider their position carefully at the outset of a dispute and, if appropriate, expressly reserve their right to challenge the jurisdiction of the expert before taking an active role. In addition, the court had to consider whether a contractual provision that required a variation or waiver to be made in writing could itself be waived by the conduct of the parties. It was held that as the parties had varied the agreement in a manner that did not accord with the terms of the contract they had agreed to waive the that provision. Accordingly, a party claiming that the contract had been varied was not precluded from doing so or from relying upon an estoppel or waiver to give effect to the varied agreement/ understanding of the parties. Such clauses are frequently relied upon by parties to defeat claims for additional payment. This case serves to remind employers that they will be unable to rely upon compliance with strict contractual formalities if their conduct demonstrates that the parties must have intended to waive the requirements of the non-variation clause or that they shared a common understanding that he requirements of the contract would not be relied upon, the understanding was communicated to the person seeking to rely upon the variation/waiver and that person was influenced by that common understanding. Whether there has been a waiver of a contractual provision requiring a variation or waiver to be in writing will depend upon the facts of any given case."

Delay and Disruption Protocol

In June 2016, the Society of Construction Law (SCL) published a consultation draft of a second edition of the SCL Delay and Disruption Protocol as part of a four-week consultation exercise which ended on 8 July 2016. The protocol is designed to provide guidance on some of the common delay and disruption issues that arise on construction projects and to provide a means by which the parties can resolve these matters and avoid unnecessary disputes. The proposed second edition updates the Protocol to take into account developments in the law and construction industry practices since the Protocol was first published in 2002.

Third Party (Rights Against Insurers) Act 2010

The Third Parties (Rights against Insurers) Act 2010 finally came into force on 1 August 2016. The 2010 Act allows a third party to issue proceedings directly against a liability insurer where the insured is insolvent and to resolve all issues (including both the insured's and insurer's liability) within those proceedings. By removing the need for the third party to first sue the insured, the 2010 Act eliminates the hurdle of restoring a corporate insured to the register of companies where it has been struck off. The Act also improves a third party's access to information about the insurance policy, allowing them at an early stage to obtain information about the rights transferred in order to enable an informed decision to be taken about whether or not to commence or continue litigation. The Act widens the category of people who can be asked for the information (which in practice is likely to be insurers and brokers) and places a time limit of 28 days on their response.

JCT contracts – 2016 edition

The Joint Contracts Tribunal (JCT) is in the process of publishing 2016 editions of its suite of contracts. The contract are being published one "family" at a time with the Minor Works contracts being the first to be published in June 2016 followed by the JCT Sub-contract and Sub-subcontract in July. Next on the list is the Design and Build family of contracts. Changes include amendments to the payment and insurance provisions.

Skills shortages

A coalition of professional bodies representing the construction and property sector have warned the Brexit minister, David Davis, that the current construction skills crisis will worsen if skilled builders from the EU are not allowed to remain in the country after Brexit. The RICS president has said that if access to a skilled workforce is further restricted, Britain could stop building.