At the beginning of 2023, the outlook for the construction industry was relatively bleak, with uncertainty around the impact of the Building Safety Act, soaring energy and materials costs, rising insurance premiums, the uncertainty of the continuing Ukraine conflict and, the perhaps inevitable, increase in the number of industry insolvencies.
Fast forward twelve months and the Ukraine conflict continues and we now have the added economic and political uncertainty arising from the Israel-Hamas conflict and, closer to home, a general election to 'look forward to' at some point this year. The implications of the BSA are now starting to be addressed by the tribunals and courts and we expect to receive the Inquiry’s Phase 2 report as Grenfell Tower continues to cast a figurative and literal shadow over the industry.
It is however not all gloom and doom for construction with interest rates stabilising (leading to some hope of a revival in funding appetite), some reports that the widely anticipated recession is over before it had begun and the recent budget underlining the Government’s commitment to nuclear energy projects.
This follows on the back of other positive developments over the past year or so with an ever increasing focus on the importance of the environment, reduction of carbon and ESG generally as well as a long overdue pledge for Equal Representation in Adjudication Pledge and Women in Adjudication (although a lot still remains to be done).
In this, our review of major developments in the UK construction disputes market over the past 12 months or so, we consider matters such as:
- important judicial guidance on the BSA including “fair and reasonableness” tests that the courts will grapple with over the coming years;
- emerging trends in adjudication and clarification around the constraints imposed by a failure to serve valid payment or pay less notices; and
- clarification around limitation periods under commonly seen construction documents
We hope there is something of interest for all readers in the following pages and, as always, our dedicated team of transactional and contentious experts are on hand should you have any questions or challenges on your own projects.