The Cleveland Bridge and Multiplex litigation is a stark reminder of one of the worst periods of construction - the early 1990s. This was a time when adversarial anarchy reigned and construction became the primary consumer of the services offered by the High Court.
This litigation is also a reminder that poor practice in procurement, contracts and payment still persists.
Essentially, the dispute between Multiplex and Cleveland Bridge stemmed from what Cleveland Bridge perceived to be persistent undervaluation, spurious counterclaims and simply non or late payment. The question, of course, was whether Multiplex's conduct amounted to a "repudiatory breach of contract" that would, in turn, have enabled Cleveland Bridge to withdraw from site. Judge Jackson deplored Multiplex's conduct but said it did not amount to repudiatory breach.
Even so Multiplex does not come out of this smelling of roses. The judge was clearly taken aback by its aggressive tactics.
Let's now hope that we learn lessons from this sorry saga.
The seeds of this litigation were sown even before Multiplex came into the picture. All design risks were passed down the supply chain. The design inherited by the supply chain had to be made to work, hence the variations. Initial programmes were unrealistic and had to be changed. Multiplex went in on lowest price expecting that its supply chain would tamely accept all the risks related to time, design and the consequent increases in costs.
The facts of this dispute are highly relevant to the current review of the Construction Act. Yet again, we have a situation where the payer has been able to say:
"I have got the money - you come and get it, if you can!"
There simply isn't the means for the payee to establish, by the date of payment, that a certain amount is owing. He is, therefore, forced to go to adjudication and/or, in desperation, cease work. Perhaps, on reflection, Cleveland Bridge may have had a stronger case for exercising its statutory right to suspend its contract under the Construction Act.
Let's now hope that we learn lessons from this sorry saga. The critical issue is early buy-in to the design from the delivery team. At that stage risks can be effectively managed - not only design risks but also other risks bearing on time and cost.