In its latest offering, “CLC COVID-19 Claims and Disputes in Construction” the Construction Leadership Council (CLC) predicts that disputes related to COVID-19 are set to rise in 2021. While the optimist may hope that parties will continue to or aim to work collaboratively in order to find workable commercial solutions to claims arising from the global pandemic, the realist knows that such disputes are inevitable.
The final nail in the coffin of Christmas 2020 for me was getting a directive from NHS Test and Trace to self-isolate on the 23rd. So, instead of celebrating Christmas, I packed the missus off to her mother’s and settled down to read the snappily-titled “Trade And Cooperation Agreement Between The European Union And The European Atomic Energy Community, Of The One Part, And The United Kingdom Of Great Britain And Northern Ireland, Of The Other Part”. Otherwise known to you and me as the Brexit Deal.
At first glance, the Court of Appeal’s recent decision in ABC Electrification Ltd v Network Rail Infrastructure Ltd  EWCA Civ 1645 might look like the culmination of an exercise in legal hubris. This was, after all, a case focussed on the meaning of a single word in a contract; moreover, a word – “default” – that most of us in the legal profession might say has a well-established meaning.
And, after several hundred thousand pounds of legal fees no doubt well spent, the Court of Appeal told the world that the word “default” means exactly what we all thought it meant – a failure to fulfil an obligation.
This sounds like a lot of money, but in real terms it is not anything like enough to restart the economy in the manner suggested by the Government. In the heady days before COVID-19, Chancellor Rishi Sunak announced new investment into infrastructure in the UK totaling £600bn between now and 2025. By comparison, £5bn is nothing like what is required to “level up” the economy in the way promised by the Chancellor. In his Dudley address, the Prime Minister confirmed that the £5bn promised was an accelerated release of those funds promised by the Chancellor, but it remains to be seen whether that £600bn will ultimately be released.
Last week we discussed, in light of the encouragement from Robert Jenrick MP (Secretary of State for Housing, Communities and Local Government) for the construction industry to remobilise, the government’s apparent reluctance to provide confidence and clarity for the construction industry in respect of the safe operation of sites.
In the Prime Minister’s address to the nation on 10 May 2020, he re-stated that encouragement for the construction industry, where possible, to return to work.
The construction industry in the UK has been afforded the freedom to continue work where it is safe to do so since the lockdown was implemented. It is a freedom that the sector has done its best to exploit where it can, with significant works continuing on a variety of essential and less essential projects. A number of leading construction companies and housebuilders have continued or recommenced work where they are able to do so, and a number of high profile projects are apparently progressing well. Build UK has reported that its members, who comprise some of the largest contractors operating in the UK, are now working on 73% of sites (up from 69% last week). However, the issues for the industry facing the prospect of full remobilisation to all sites have not changed.
In an industry of seemingly ever-tighter margins across the board, it is perhaps unsurprising that the construction industry has fought to continue through the current coronavirus crisis as much as it has. However, many in the industry have stopped work and shut down sites and, despite the current and perhaps somewhat over-optimistic view from the government that work can continue whilst still complying with social distancing rules, it seems inevitable that all non-essential work will stop very soon. Continue reading “Coronavirus and Construction in the UK: The Time to Talk Is Now”