BPF’s consultancy agreement criticised as ‘totally unacceptable’

By the newsdesk

A new agreement, designed for clients to use to appoint all construction consultants including QSs, is already facing criticism in the week of its launch.

The British Property Federation Consultancy Agreement, launched on Wednesday, has a clause that is “totally unacceptable to consultants” an expert claimed.

Frances Paterson – who is heading a working group for consultancy umbrella body the Construction Industry Council that is drawing up a similar agreement – has taken issue with a clause in the agreement that covers novation, when responsibility for a project passes from a client to a contractor.

Paterson said: “Not only does it (the novation clause) create the fiction that the contractor was the consultant’s employer from the outset, there are additional unacceptable provisions that the contractor has relied on information and advice given, and that the consultant agrees that any losses suffered by the contractor were within the contemplation of the consultant.”

Paterson said her working group was hoping to produce a draft version of its own agreement, which it has been working on for 18 months, early this summer. The working group includes solicitor John Hughes D’Aeth, partner at Berwin Leighton Paisner.

Both agreements are attempts to create single, easy-to-use agreements instead of the plethora of bespoke documents clients currenlty creating for each construction profession.

Roger Squire, chairman of the BPF working group that produced its agreement, said many of the clauses in the agreement were similar to those already in use by some clients. He said: “It’s not just about putting more responsibility on the firms, but also about filling in the gaps that exist in current agreements.”

It’s not just about putting more responsibility on the firms but also about filling in the gaps

Roger Squire, BPF

Squire added that the body’s perception was that many former agreements were not always in

the clients’ favour, and added that the body wanted to “create a generic client standard”.

Ann Minogue, partner at law firm Linklaters, said she hoped that companies would look pragmatically at this attempt to introduce some sort of standardisation into the industry.

The sector is also facing a raft of new construction contracts to be published by the Joint Contracts Tribunal (JCT) early next month. The JCT 98 suite of contracts is being updated, redesigned and relaunched as JCT 05. The JCT, which produces contracts for the entire construction industry, is expected to go on redrafting further contracts until next year.

The Standard Form of Building Contract, which could previously take the form of six alternative contracts, has also been slimmed down to three: Standard Building Contract With Quantities (SBC/Q), Standard Building Contract Without Quantities (SBC/XQ) and Standard Building Contract With Approximate Quantities (SBC/AQ).

There are no longer any separate supplements as these have all been incorporated where appropriate.