Welcome to the latest edition of 'Building Blocks', Charles Russell's quarterly on-line update focused on the Construction and Engineering industries. The update is produced by Charles Russell's specialist Construction and Engineering Team. Building Blocks aims to profile legal developments and case law that may affect your business.

In this edition we consider a recent case highlighting some potential (and expensive) traps for the unwary in the public procurement process, case law on concurrent delay, changes in force from 6 April 2008 relating to the execution of documents and the introduction of EPCs and a reminder of the important distinction between the obligations of "fitness for purpose" and "reasonable skill and care".

Yours sincerely,

David Savage,
Partner - Head of Construction and Engineering



BID RIGGING
The OFT has recently published a report accusing 112 construction companies of colluding amongst themselves while bidding for contracts, leading to customers, such as local authorities, having to pay too much. Click here for more details and comment.


PROCUREMENT OF PUBLIC WORKS: HARMAN REVISITED
In the recent case of Aquatron Marine v Strathclyde Fire Board, the Contractor was awarded significant damages arising from a breach of the Public Services Contract Regulations 1993. The problem arose from a badly worded advertisement in OJEC (now the OJ) and failures in the tender assessment process. Click here for more details.


CONCURRENT DELAY - A SCOTTISH LEAD?
The area of concurrent delay is a particularly contentious and difficult area of construction law. How should the courts approach the issues of granting extensions of time and assessing loss and expense for periods of delay where there are two causes, one the responsibility of the contractor and one not? A recent Scottish case may represent one way forward for the English courts. Please click here for our article looking at this area of law.


IMPORTANT CHANGES TO THE LAW ON EXECUTING DOCUMENTS
Many contracts, including most collateral warranties, are executed as deeds.
The usual reason is that the limitation period for actions brought under deed is generally twelve years, as opposed to six years for simple contracts. Practically, this caused some inconvenience due to the previous requirement for deeds to be signed by two directors or one director and the company secretary (unless the company has a common seal). However, following the latest phase of implementation of the Companies Act 2006 there is a change in the way companies execute documents.
From 6 April 2008, companies:

• will no longer be required to have a company secretary; and
• will be able to execute documents by the signature of one director, providing he/she signs in the presence of a witness.

Click here for more information on these and other important changes in force from 6 April 2008, including practical guidance on steps that companies may wish to take.


N.B. - The JCT has issued an attestation update to cover this change.


ENERGY PERFORMANCE CERTIFICATES (EPCs)

The Energy Performance of Buildings (Certificates and Inspections) (England and Wales) (Amendment) Regulations 2008 came into force on 6 April 2008. These regulations introduce the requirements for EPCs for non-dwelling buildings in three stages, based on total useful floor area. Click here for more information.

FOUNDATIONS: REASONABLE SKILL AND CARE OR FITNESS FOR PURPOSE?
The terms "reasonable skill and care" and "fitness for purpose" are common parlance in the construction industry, but are often used in the wrong context. Click here for a reminder of the legal definitions and when each may apply.


For more information on Charles Russell's Construction & Engineering Team click here or contact David Savage (Partner, Head of the Construction & Engineering Team) at david.savage@charlesrussell.co.uk or on 01483 252614. The Chambers UK Guide to Legal Profession 2008 described the Charles Russell Construction & Engineering Team as follows:

"Split between offices in Guildford and Cheltenham, this construction team has been growing at an admirable rate under the leadership of David Savage, with little sign of abatement: three new fee earners have joined in the past year, bringing the total to seven. The group offers a full range of contentious and non-contentious construction work. Clients choose the firm for its "development experience, local government knowledge, ability to get to the heart of a matter and keen prices".

David Savage, Stephen Rockhill and Sarah Jane Hudson are all ranked as leading individuals by Chambers 2008.

Previous Editions:
January 2008 >>more>>
September 2007 >>more>>
June 2007 >>more>>

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