Construction Contracts, Questions and Answers

1 Construction law is sometimes simple and at other times need Answers that are pithy and straightforward but alsolegally number of Questions come up time and again. They range incontent from extensions of time, liquidated damages and loss and/orexpense to issues of practical completion, defects, valuation, certifi-cates and payment, architects instructions, adjudication and Questions are relatively simple, such as what date should beput on a contract? , but there are implications to even the simplestquestions. More elaborate ones might involve whether the contrac-tor is entitled to take possession of a section of the work eventhough it is the contractor s fault that possession is not Chappell is well known as an architect, lecturer and writeron Construction law.

2 He has served for many years as SpecialistAdviser to the Royal Institute of British Architects, and this experi-ence has given rise to this book. All the Questions set out here are realones; and although most were originally asked by architects, theiranswers will be of wide interest to QSs, project managers, contrac-tors, employers and others engaged in Chappellis director of David Chappell Consultancy Limitedand sometime Visiting Professor of Practice Management and Law atthe University of Central England in Birmingham. He has writtenmany articles and books for the Construction industry, includingSpon s Understanding JCT Standard Building Contracts, now in its7th edition. He frequently acts as an Contracts, Questions and AnswersAlso available from Taylor & FrancisUnderstanding JCT Standard Building Contracts7th editionD.

3 ChappellConstruction ContractsLaw and management4th editionJ. Murdoch and W. HughesDevelopment and the LawA guide for Construction and property professionalsG. Bruce-RadcliffeDictionary of Property and Construction LawR. Hardy-PickeringThe Presentation and Settlement of Contractors Claims2nd editionM. Hackett and price availability and ordering visit our website our books are available from all good Contracts, Questions and AnswersDavid ChappellFirst published 2006by Taylor & Francis2 Park Square, Milton Park, Abingdon, Oxon OX14 4 RNSimultaneously published in the USA and Canadaby Taylor & Francis270 Madison Avenue, New York, NY 10016, USAT aylor & Francis is an imprint of the Taylor & Francis Group,an informa business 2006 David ChappellAll rights reserved.

4 No part of this book may be reprinted orreproduced or utilised in any form or by any electronic, mechanical, orother means, now known or hereafter invented, includingphotocopying and recording, or in any information storage or retrievalsystem, without permission in writing from the publisher makes no representation, express or implied, with regardto the accuracy of the information contained in this book and cannotaccept any legal responsibility or liability for any errors or omissions thatmay be Library Cataloguing in Publication DataA catalogue record for this book is available from the British LibraryLibrary of Congress Cataloging in Publication DataA catalog record has been requestedISBN10: 0-415-37597-5 (pbk)ISBN13: 978-0-415-37597-9 (pbk)This edition published in the Taylor & Francis e-Library, 2006.

5 To purchase your own copy of this or any of Taylor & Francis or Routledge scollection of thousands of eBooks please go to Preface to the First Editionxvi1 Pre-contract issues 11 Can the lowest tenderer legally do anything if its tender is not accepted?12 Is the architect responsible if the tender comes in over budget?23 The contractor s tender states that it is open for acceptance for six weeks from the date of tender, but the contractor withdraws it after three weeks citing a suddenly increased workload. Is the contractor liable to the employer for the additional costs of a replacement contractor?44 The employer is in a hurry to start work. Is there a problem in the issue of a letter of intent?55 If a letter of intent is issued with a limit of 20,000, is the employer obliged to pay a higher sum after allowing a contractor to exceed the limit?

6 86 What date should be put on a building contract?107 Does the architect have any particular duty to draw the attention of the contractor to onerous terms or amendments in the contract?118 Can there be two employers on one contract?139 If the employer wishes to act as foreman, can each trade be engaged on an MW contract?1410 What if no one notices the contractor s serious financial error until the contract is executed?15 Contents2 General contractual matters 1811 If the employer is in a partnering arrangement with a contractor, does that mean that the SBC does not count?1812 The contractor has no written contract with the employer (A). (A) instructed the contractor to do work and asked it to invoice their sister company (B).

7 The contractor did so and B has not paid Is there a contract under SBC if everyone acts as though there is?2314 Can certificates and formal AIs be issued if the contract is not signed?2415 Does a note in minutes of a site meeting rank as written agreement for the purposes of the Housing Grants, Construction and Regeneration Act 1996?2516 If the employer sacks the architect under MW and appoints an unqualified surveyor as contract administrator, is the contract still valid?2617 Can a warranty be effective before it is signed?2818 SBC: There is a clause in the bills of quantities preliminaries which states that no certificates will be issued until the contractor has supplied a performance bond. Work has been going on site for 6 weeks and there is no performance bond, but the contractor says that the architect must Can a contractor avoid a contract entered into under economic duress?

8 3020 Funding has been stopped and three certificates are unpaid. The contractor has suspended , vandalism occurred on site whose problem is that?3221 In DB, if the employer provides a site investigation report and the ground conditions are found to be different, who pays any extra cost?343 Contractor s programme3722 If an architect approves a contractor s programme, can the contractor subsequently change the programme without the architect s knowledge and, if so, can the architect demand an update?37vi Contents23 Under SBC, the architect has approved the contractor s programme, which shows completion 2 months before the contract completion date. Must the architect work towards this new date?3924 Can the architect insist that the contractor submit the programme in electronic format?

9 4225 When a contractor says that it owns the float, whatdoes that mean?434 Contract administration4626 Does the contractor have a duty to draw attention to an error on the architect s drawing?4627 Under DB, must the employer's agent approve the contractor s drawings?4828 What happens if the contractor cannot obtain materials?5029 What powers does a project manager have in relation to a project?515 Architects5430 Planning permission was obtained for a small building. The building owner wants to press ahead with a larger building without further reference to Planning. The architect knows that the Planning Department would refuse the large building out of hand. Should the architect continue to do the drawings and administer the contract on site?

10 5431 SBC. Roof tiles were varied at site meeting and by letter, but the contractor ordered the original ones. Should the architect have changed the drawings as well?5532 Are there any circumstances in which a contractor can successfully claim against the architect?5633 Is an architect liable for failure to advise a client to use a better material?5934 The job went over time. The employer and the contractor did some kind of deal. Where does that leave the architect?6135 What are the dangers in a Construction professional giving a certificate of satisfaction to the building society?62 Contents vii36 Is the client entitled to all the files belonging to Construction professionals on completion of the project?6437 When can job files be destroyed?