So construction management is found to be responsible for another major disaster to add to the severe criticism the procurement route received at Holyrood (11 March, pages 42-46). The Great Eastern Hotel case must be the final nail in the coffin?
Maybe not. The judge does place the construction manager firmly in the employer’s professional team. This is something all CM providers always knew, but it was missed by some clients, particularly when jobs went badly. The CM is not a surrogate main contractor, liable through draconian interpretations of duties to “ensure” and “procure”, or for the risks of specialist contractors performance. However, the CM must act as a “reasonably competent construction manager” and make sure “all that was reasonable” was done. Would we expect anything else? I think not.
On the issue of procurement, the judgment penalised the construction manager for allowing specialist contractors to commence work without fully defined contractual arrangements, thus exposing the client to unnecessary risk.
This highlights the dangers of a construction manager pushing ahead, with the best of intentions, in order to protect the programme, and shows what the consequences may be when things go wrong. It is not the construction manager’s role to make these decisions on behalf of the client and without the client’s knowledge.
The damages include a proportion of the value of the variations added to works packages. This, it was stated, was because many of those items should have been included in the original scope of the packages. This is dangerous ground for a construction manager working to protect the overall programme and covering for late or poorly detailed drawings and specifications. It certainly highlights the need for close communication with the team, including the client. Risk analysis and the presentation of this information to the client is vital.
Honesty about delays and programme issues is called into question throughout the judgment.
A recurring theme is the importance of communication between the construction manager and its client and the ability of the construction manager to report accurately and objectively on the status of the project. One thing any successful CM project needs is a fully engaged client. I don’t see evidence of this at either Holyrood or GEH.
So where does this case leave CM? I think it is where we were anyway: in a niche market providing specialist services with specialist people to clients who understand the principles of this procurement route. What this and Holyrood has emphasised is the importance of contracting with the right client: someone who is prepared to work with you and to engage with you. And if we get it wrong – we can expect to pay!
Chris Paxford, managing director, Clarus Consulting