Construction Dispute Blog

In this blog, we will delve into how Arbicon can help you navigate the challenges of construction delays.

Arbicon are thrilled to announce the launch of our brand-new website!

Arbicon provide premier construction Expert Witness services, including production of CPR35 reports, to support and strengthen your legal arguments in your construction dispute weather in court arbitration or adjudication proceedings.

The construction industry is no stranger to building defects, which can be a headache for property owners and Contractors. Defects can be anything from minor cosmetic issues to significant structural defects that compromise the safety of a building. In any case, building defects are breaches of contract and they can result in costly repairs, delayed projects and payment disputes.

John Elven, Senior Consultant at Arbicon, discusses how subcontractors should follow payment provisions carefully in order to get paid.

As a Contractor engaging with a Building Employer or another Contractor in a Construction Contract carries risk, reducing that risk is important. The construction industry has by far the greatest number of disputes than any other industry, 95% of dispute consultants are construction related. Arbicon discuss what could go wrong in a Construction Contract and explain how to minimise these risks.

Jonathan Nugent, Managing Director of Arbicon, the leading construction contract claims consultant gives an insight and tips into 10 examples of typical onerous clauses that often appear in construction contracts. Jonathan considers the legal and practical consequences of their negative effect for the payee. Do you know what you have signed up to?

Arbicon are pleased to announce, as part of the firms expansion, the opening of a new office in Leeds.   The new office will serve as a hub for our team in the northern region and will allow us to better serve our clients in the area. Our new office overlooks St. Paul’s Square in Leeds and is based in the historic St Pauls House.

The new Building Safety Act 2022 (BSA) came into force on 28th June 2022, it is aimed at liability for defects in “dwellings” and in the context of making buildings safe. In theory it aims at prosecuting those persons associated including designers, suppliers, contractors, regardless of any bankruptcy defence associated with the supply and installation of defective and/or dangerous building products and buildings. The legislation is born out of the Grenfell Tower Fire in 2017 targeting “high risk” buildings such as those over 11m high and constructed in cladding as well as all other buildings. The main point to note is that the BSA amends the limitation Act to 15 years for defects in buildings and in the case of the “high risk” buildings and those falling under Section 1 of the Defective Premises Act 1972 claims can be made going back to 28th June 1992 over 30 years ago. What does it all mean?

The NEC 4 ECC contract clearly defines compensation events and how these are to be notified. This article considers a particular aspect of notifying compensation events which relates to another NEC provision, namely, the giving of early warnings.

In Part 2 of our series covering communications in NEC Contracts, John Elven, Senior Consultant at Arbicon, discusses the importance of maintaining good communications in accordance with the requirements of NEC Contracts as a means of promoting dispute avoidance, focussing on NEC 4 clause 13.

Last month, Arbicon supported the Tony Hadley Golf Day 2022 in aid of Action Medical Research, a charity dedicated to funding vital research to save and change children’s lives, developing lifesaving vaccinations and treatments.

Jonathan Nugent discusses what possible further improvements could be made to the Construction Act to stamp out commercial bad practice and balance construction contract power.

In Part 1 of our series covering communications in NEC Contracts, John Elven, Senior Consultant at Arbicon, discusses the importance of maintaining good communications in accordance with the requirements of NEC Contracts as a means of promoting dispute avoidance.

The updated Construction Act (LDEDC Act 2009) that came into force on 1st October 2011, made it mandatory for the parties to a construction contract to manage the payment process properly and establish a notified sum in each payment period, during and at the end of the works. If the contract requires an application for payment then that application becomes the “Notified Sum” due, if the payer fails to deal with it and fails to state what is to be paid, either in a Payment Notice or Pay Less Notice, which have become familiar terms. After all this time, parties still get confused about their payment rights and many are unaware that they have a default payment position until we evaluate their case! The construction law is on the side of the payee. So what is Smash and Grab Adjudication?

When the final account and final payment must be considered when a construction project reaches completion, it is common for the paying party to withhold payment against what they consider to be defective works.

You are owed thousands of pounds and face a real struggle to survive due to one bad contract and one personality you could do without…sound familiar? So, what do you do? Typically, if you are not facing fabricated contra charges you will be asked to substantiate your account, even when you think you have done so!

John Elven, Senior Consultant at Arbicon, discusses the importance of acting in accordance with the requirements of NEC Contracts as a means of promoting dispute avoidance. NEC contract disputes often arise where there has been a failure to follow the requirements of the contract. In view of this, it is essential to read and understand your NEC contract, and then do exactly what it says. By doing this, those involved with NEC projects are in a far better position to get things right from the start and to prevent disputes from arising in the first place.

The term ‘loss and expense’ in construction is often used to describe any additional costs that a Contractor incurs following breaches of contract by the Employer such as delay and disruption. Read our tips on how to submit a successful loss and expense claim.

The three fundamental essential elements of any construction contract are PRICE, TIME and SCOPE. Price and Scope are often only perceived as required by contracting parties, without any serious consideration for TIME. Time is money, so on any construction project it is little wonder that often when a project is delayed or delivered late, a construction dispute will arise.

Construction cost inflation in 2021/2022 is unprecedented, after decades of price stability in the supply of materials, labour and plant, construction costs have skyrocketed together with shortages of all resources.

The purpose of a Pay Less Notice is to give the paying party the legal right to pay less than/withhold all or part of an already notified sum, altering the payment due to the payee near to the end of the payment cycle. The Pay Less Notice must specify the ‘notified sum’ for payment, and the basis on which the sum has been calculated, even if that is zero or negative. We have put together steps on how to challenge a Pay Less Notice if you disagree with it.

What steps can a subcontractor take to protect themselves against non-payment?

John Elven recently joined Arbicon as Senior Contracts Consultant, bringing with him a wealth of experience in NEC, civil engineering, and construction contracts. Get to know John a little more by reading our Q&As...

It is well known that construction contracts can bring problems with them if not drafted to contain the correct terms or are ambiguous. Even when a contract is written correctly, things can go wrong, and sometimes get out of control. Determining when a breach of contract has occurred and whether it is a repudiatory breach is fundamental to understanding your rights and resolving a construction claim.

As Arbicon notch up another almost weekly victory using adjudication, the latest being circa £800K plus Adjudicator’s costs, interest and VAT payable by the other party, which is not an unusual sum that we deal with, I wanted to reflect on the achievements of our firm in the past year and indeed the past 23 years since adjudication was born. I should not admit it, but I was there at the birth!

Arbicon are pleased to announce the appointment of John Elven as Senior Consultant, adding to its expertise in NEC, civil engineering and construction contracts.

Episode 16 of Constructive Voices features Simon Dunkling from Arbicon, discussing onerous construction contracts. This episode is well-timed in November 2021, as the industry sees challenge after challenge of rising material costs, along with shortages in both materials and labour.

Onerous construction contracts are often entered into by contractors and subcontractors across the construction industry, leaving them out of pocket, at a high risk of cashflow problems, and even insolvency.

Recently the Court decided two key cases concerning liquidated damages, one regarding liquidated damages where a contract has been terminated prior to the works being completed, and the other regarding liquidated damages where the employer has taken partial possession. These cases provide timely clarity to the construction industry at a time when increased delays and contract terminations are being seen following the impact of Covid-19.

Jonathan Nugent, Managing Director at Arbicon ADR Ltd, explains how Contractors are still unaware of the right to adjudication in construction contracts, and are losing out on significant payments due. The construction industry is well known for late payment and indeed non-payment. When Main Contractors and Subcontractors fall foul of a payment dispute, it should come as a surprise that many are still unaware of their right to adjudication to recover sums…but unfortunately it is not a shock to Arbicon.

With material shortages and price increases currently affecting the construction industry, Arbicon warn of the importance for Contractors, Subcontractors and Building Employers to check their construction contract provisions and protect themselves against the impact of Covid-19.

Unfortunately, retention is a well-documented source of problems in the construction industry, with retention often not released on time or, in some cases, not at all. With the effects of Covid-19 and the current climate a difficult one for many businesses, unduly withheld retention only adds to the difficulty, leaving contractors and subcontractors at a higher risk of cash flow problems and even insolvency. Arbicon have put together five top tips on recovering retention in construction contracts.

Conclusivity provisions associated with the Final Certificate are a commonplace feature in many construction contracts and serve to ensure that after a specified point in time, certain matters are concluded and no longer open to challenge. However, despite being common, the implications of such provisions are often overlooked until it is too late. If you have received a Final Certificate, it is important to act urgently if you do not agree.

It is well known that the UK Construction and Civil Engineering Industries have the highest incidence of disputes…many of which arise from payment issues. Throw a pandemic into the mix, increased construction delays, non-payment, labour shortages, and cash flow becomes a struggle for many contractors. The good news is that you can take steps to reduce your risk of falling foul of payment issues and preventing cash flow problems….

Arbicon are delighted to be speaking at the Cambridgeshire Chambers of Commerce Construction Network Zoom event, where Managing Director, Jonathan Nugent, will discuss the topic: Construction Contractor Upscaling – The contractual pitfalls and how to avoid them.

Jonathan Nugent, Managing Director, explains Pay Less Notices and what to do if you receive one. Despite the detailed statutory law on payment in construction contracts being in place for almost 10 years, it is still not always understood and leaves many confused.

Contracts are an important part of the process of any construction project. A construction contract such as a JCT or NEC Contract provides important protection for Main Contractors, Subcontractors and Building Employers and is vital in preventing disputes. Primarily the contract safeguards against payments and guaranteeing adequate work, but if a dispute arises, construction contracts can also dictate how the parties move forward to resolve the issue. Simon Dunkling, Director at Arbicon ADR Ltd, Construction Dispute Experts, explains the importance of using a properly drafted written contract for construction projects and the negative impact if the corrects terms are not included.

Major New Law for Construction Adjudication – The Right to Adjudicate When Insolvent – Bresco Electrical Services Ltd (in Liquidation) v Michael J Lonsdale – Supreme Court 17th June 2020

With the construction industry starting to return to some normality, we as Construction ADR Specialists are getting asked several questions relating to the impact of Covid-19 on employers, contractors and subcontractors within the industry. With social distancing in place on construction sites, productivity has been hugely affected and many contractors have struggled to obtain the materials and supplies required for their construction works, causing delays and disruption to construction projects.

The likelihood is that contractors will be entitled to an extension of time, but if it is granted it will be a neutral event so no costs can be recovered by either party, but is a time extension set in stone?

As we start another new month in lockdown, major construction firms are making big announcements about reopening their sites and the industry is starting to see light at the end of the tunnel. There is a sense of unity to those of us working in construction, knowing that the country is looking to us to keep the wheels of our economy turning.

The current situation is an unsettling time for us all in the construction industry, not only in terms of the uncertainty of work, but also cash flow problems, which if prolonged could have serious financial implications.

Despite the changes that the construction industry is facing, we wanted to reassure you that our specialists here at Arbicon continue to be able to resolve your disputes, assisting in the management of all notices, agreements and settlements. We are continuing to follow government guidance and our team is working from home, albeit fully contactable on phone and email.

With Boris Johnson addressing the Nation last night, announcing “you must stay at home”, as he placed the UK on lockdown in a bid to stop the Covid-19 Pandemic, the reality of lockdown for the UK has struck, but has it? Boris was so flowery in his delivery last night that everyone is confused, especially contractors and what this means for construction sites. Rightly so, contractors are in total confusion as to what this means for them and have asked for clarity after a Cabinet minister said it was fine for sites to remain open – less than 90 minutes after the Prime Minister announced the three-week Coronavirus lockdown.

With the recent changes in Coronavirus (COVID-19) guidance, we wanted to reassure you that during this testing time we are doing our upmost to continue business as usual in assisting customers with their construction disputes, while keeping health and safety top of mind.

The JCT contract suites do not mention what happens in the event of the Coronavirus (Covid-19) or anything like it shutting down the World. So, what commercial problems will construction contracts face and how can the contract deal with this unprecedented situation?

Arbicon are celebrating 14 years in business this year. Managing Director, Jonathan Nugent, founded the company in 2006, and reflects below on the issues that construction contractors are regularly facing, which inherently lead to construction disputes.

Arbicon are expanding the team and are delighted to welcome Senior Consultant, Louise Knaggs.

For years the misconception of resolving a dispute is the need to go to court! In fact, a commercial contract dispute can be resolved with Alternative Dispute Resolution (ADR) which is ‘anything but go to court’ and offers many advantages, which we take a look at.....

Has your Expert been trained as an Expert? That might sound like a contradiction but it is important to know what you're getting when you instruct an Expert Witness and that an Expert has the correct skills in delivering Expert evidence to a Court or Tribunal.

If you search for articles on late payment relating to SMEs, you find publications deal with complaints and statistics showing how the problem is rife but actually offer no solution. All articles refer to optimistic future actions to be taken by the government, such as undefined fines and sanctions that have never materialised. The Chamber of Commerce says it plans to lobby parliament on this problem in the New Year, but what is it going to ask for? Late payment always becomes more acute when money gets tight, you see more bankruptcies and this year it has been a particularly trying one, for example with the uncertainty of Brexit.

Continuing the topic of Construction Act Improvement, what if any changes should be adopted to improve the way in which Retention is dealt with? Retention has been a cause of complaint and quarrel for all time in construction contracts. It is designed to allow the Paying Party (e.g. the Employer or Contractor) a means to hold on to money due, just in case there is a dispute later. It is normally 3% - 5% taken from the gross value of the account as work proceeds and is in theory paid at the end of the project when everything is agreed and signed off.

The Construction Act on the 1st May 2018 celebrated its 20th birthday; it provides Payment and Adjudication rights to Commercial Construction Contracts. The Government are considering further improvements to the Construction Act last updated in 2011, which you can read more about by clicking here The recent government consultation by the Department for Business, Energy and Industrial Strategy set out to measure the effectiveness of the 2011 changes to the Construction Act looking