Contracts

4th May 2019 - Frances Forward

Sources of Law/Contract/Tort/Procurement

Partnering and 'Modern' Contracts: PPC2000/NEC4

Compatibility of Design & Management

No civil codes or constitution

Most is 'civil law', Health & Safety is issues could be 'criminal law' - (small c)

Common Law = exist on the basis of custom, equity

Primary / Secondary Legislation

Primary (Acts of Parliament, First Instance)-> Town & Country Planning Act, Building Act, Architects Registration Act

Primary Building Act (Town & Country Planning Act)

Secondary Building Regs

Guidance Approved Document

Reversal of 'burden of proof'

Architect try to comply with AD, then Building Control needs to prove we don't comply

Local Democracy Act

Housing Grants, Construction & Regeneration Act

- Scheme for Contract...

International Distinctions

European - Civil Codes, Statute

Chinese - civil, socialist law

Islamic - religious

Law of Contract

Offer (Fee Proposal) + Acceptance (Letter of Appointment) = Agreement

Consideration = value surpassed between the parties (first payment e.g.)

Signed as Deed, exception to 'Consideration'

- 6 years liability

- 'Simple Contract'

Intention to create legal relations = circumstantial

Capacity = age, mental health

Authority = individual, straightforward company, who can sign

Breach of Contract

Remedy for breach = Liquidation of Damages

'Damages' as a legal term (plural)

- chronologically forwards

No penalty under the contract in English Law

Law of Tort

People not in contract with

Negligence, Nuisance, Defamation

- to be negligent different to Tort of Negligence

Tort of Negligence (all 3 to be present)

- Duty of Care

- Breach of Duty

- Damage (physical/economic/mental)

Liability in Tort

Remedy for tortious act

- Damages (backwards chronologically)

- similar to medical negligence, higher than Damages in Contract

- Position prior to tortious act... as far as possible

Procurement Parameters

Time - Speed/Certainty

Cost - Value/Certainty

Quality - Specification/Workmanship

Risk - Management

Perfectly possible to have high Quality and low Risk, Time, Cost

Contractual Concepts

Rights

Contractor's right to payment

Employer's right to performance within timescale

Type of Contract

- dependent on Client's needs

Traditional - Control Time? Risk?

Design & Build - Control Quality? Risk?

Management - Control Cost? Risk?

'Hybrid' - Variable Control? Risk?

-specialist architects/contractors and building type influence this choice

Form of Contract

Standard forms (ensures certain guarantees):

JCT

NEC

PPC2000

RIBA

ACE

Standard Form Amendments

Reasons for contemplating amendments

- sometimes legitimate, often not, risk shunting

Effect?

- not always predictable? Who drafts?

Bespoke?

- could be counter-productive... why?

Building Contracts

Traditional design<-->construction

D&B design-><-construction

Mgmt {design construction]

Professional Services Contracts

Services - clarity

Fees - calculation methods

Role of RIBA (plan of work) - management/co-ordination

Standard forms - RIBA Agreements, NEC PSC

resource based

Relationships with the client being recorded

- professional services + building (contracts)

Contractual Complexities (?)

Letters of Intent

- binding Contract? if properly drafted, yes

- could go into a Contract later, subsumed

- sue?

- 'intends to enter a contract with...'

- mere intent?

- cost and time

- limitations

Collateral Warranties

- Client <-> Bank (e.g) <-> (collateral warranty) Contractor

- Tenant / Freeholder - Contractor

- parallel liabilities

- identical duties? - class of people -> increase liability

- to whom are they owed?

- seek legal advice, no PI insurer

- Contracts Third Parties Act

Partnering

- Efficiency

- Improved Performance

- Existing suppliers - whole supply chain

- Intuitive - personalities matter

- Volontary - non-binding 'charter'

- Mandatory - binding contract

- Principles

- Trust - between all Partners

- Co-operation - not competition

- Mutual Gain - win-win

- Obligations, collaboration, communication, strategy

PPC2000

Larger projects generally

Key Principles

- Multi-party (only!) flaw - disputes/remedies

- must partner (scale of project)

- Principal Stages

- roles change, fore-see future events, flexible

- Consultants

- PPC2000 is vague on this

- Administration Role

- long-term commitment, senior employee (worth it)

- consultant -> (Project+Insurance) <- consultant

- VS (?)

- insurance -> (Project) <- insurance

NEC4

Black, Green, Purple, Mauve, Bright+Orange, Navy books

Any procurement method (Trad, D&B etc.)

Flexible tweaking (harder with JCT e.g.)

- Structure

- core clauses (Termination etc.)

- Main option (payment, procurement?)

- Secondary options (multiple currencies)

- Project Specific Info

- Contract Data

- Parts One (Client) and two (Contractors) - reciprocal, rights&obligations - at tender stage

- Project Documentation

- Works info

- Site info (risk!)

Project Management - key purpose of NEC

- Contract Assistance

Pricing Mechanisms

- incentivise

People

- flexibility of role (architect - pre-contract stage: designer - as a contract administrator - supervisor)

Change Control

- compensation, not variation, not drifting programme

- mechanism - time/money

Risk Allocation

- fixed or fine-tuned

Defects

- notification/correctio, not left to end

Completion

- status

Dispute Avoidance

- proactive, early warning procedure (make other parties aware - to avoid adjudication)

Jurisdiction

- location, clause data non-jurisdiction specific

Design

- responsibility

- who should carry?

- liability

- Standard of Care

NEC-contract

Circular diagram with various Documents around the perimeter

PPC2000-contract

Linear diagram with various Documents merging into one