Major Ian Fenwick behind enemy lines in France

There is much to be said for the view that, in the long run, the most effective way to procure construction work is to use standard forms, and to take a reasonable approach to the allocation of contractual risks, avoiding excessively onerous provisions.  Thus, the notably successful strategy of The Olympic Delivery Authority in London was to use the NEC contract, and the World Bank now mandate the use of review boards which provide a prompt and reasonable way of preventing construction issues escalating into full blown disputes.  Experience shows that testosterone-fuelled drafting might be good for the income of construction lawyers, but does little to advance the interests of those procuring construction projects.

In any event, much of the typical onerous drafting that one sees today is entirely ineffective in jurisdictions subject to the East Coast Model of Security of Payment legislation, which drives a coach and horses through the contractual regimes.  In the face of that legislation, owners and head contractors are often thrown back onto mere bullying, threatening contractors and subcontractors that they will be blacklisted if they make use of the legislation.  Interestingly, however, contracts very rarely take any useful steps to emasculate the effect of the Security of Payment legislation, even where there is scope to do so.  Perhaps this is because the legislation itself is such an anathema to the contract draftpersons that they cannot bring themselves to read it, and work out how to best circumvent it.  With this in mind, these thoughts are offered as to how the Act might be addressed.  References are to Continue reading →