Now 2004 is behind us, let’s have some fun plotting how to kill off its more doubtful legal practices, and how to breathe life into a couple of neglected innovations
It is usual at this time of the year to reflect on the past 12 months and look forward to the new year. These are a few of my thoughts on the matter.
Rather predictably, the Society of Construction Law delay protocol began to disappear from our radar screens last year. Sadly, it seems to live on as a seminar lecture topic given mainly by those who were involved in its drafting in a vain attempt to breathe some life back into this unfortunate piece of work. Very occasionally it crops up in submissions made by parties in adjudication (not in court, for obvious reasons). Pleasingly 2004 seemed to pass with almost no reference to the protocol in any contracts that parties entered. Let us hope that there is no revival of it and that, on the lecture circuit, it is finally snuffed out.
While on the subject of programming and delay, my second hope for the year is that the “black art” of programming becomes a thing of the past and that the decision in Skanska vs Edgar, reported on by Dominic Helps (5 November, page 54) prompts a review of the way in which programming evidence is presented. We can but hope that his comment is heeded that computer programs are only glorified calculators and no substitution for direct application, professional experience and objective judgement based on clear knowledge and understanding of the actual facts.
Third, the issue of the payment provisions in the Construction Act continues to mystify many advisers. Some sensible recommendations have been made by the government taskforce, and yet, despite the fact that the law appears to have been clarified, some parties continue to run the old-fashioned “notice argument” in adjudication, hoping to obtain a windfall or a quick buck on a technicality. There are few – if any – adjudicators left who believe that failure to serve a withholding notice results in the sum claimed becoming the sum due, without express wording in the contract to provide for this. So why are so many adjudications run on this issue? Hopefully the old school will finally be shut down, and advisers will stop running such worthless arguments.
Fourth, I would make a plea to employers and contractors to start using, or, in the case of consultants, to start recommending, the JCT Major Projects Form. Considerable effort went into producing a contract that closely reflected market practice and hence cut down on the need for costly and lengthy negotiations and amendments. The time has come for everyone to consider the use of this document as an alternative to using JCT98 with lengthy amendments. Don’t be afraid, just go for it.
Fifth, is it too much to think that 2005 may finally see the end, or at least a reduction in, the use of collateral warranties? The Third Party Rights Acts has been around for five years but 95% of contracts seem to write out its provisions, preferring to rely on the collateral warranty. Could everyone make a superhuman effort to try to use the Third Party Rights Act? Here again, using the JCT Major Projects Form, which provides third party rights in favour of funders, purchasers, tenants and consultants, would be a step in the right direction.
Sixth, it would be wrong not to consider the most popular topic in these pages over the past five years, namely, adjudication. The process continued to improve in 2004, with adjudicators becoming increasingly effective in dealing with complex and technical disputes in a cost effective and efficient manner. It is hoped that the improvement continues, that the nominating bodies continue to monitor the quality of adjudicators and uphold complaints (where justified, of course).
Finally, a thought on dispute resolution generally. So many methods abound now and yet few seem to work satisfactorily in resolving disputes at an early stage, with a saving in costs beyond that that would be spent if the dispute had ran all the way to the doors of the court. Could parties get back to good old without-prejudice negotiations? A return to mediation as it used to be – before fully particularised claims, written submissions, presentation by QCs and the like – would be welcome.
Nick Henchie is a partner in the construction and engineering group of Mayer, Brown, Rowe & Maw