Managing environmental risks in construction contracts

How do environmental provisions in construction contracts work in practice? Andrew Waite, environmental law consultant at Ashurst, and Michael Weissman, senior associate in Ashurst’s construction team, comment on the key environmental concerns and risks in building contracts.

What are the key environmental concerns in construction projects?

The key environmental concerns in UK construction projects are:

• contamination—particularly, whose responsibility it is to deal with and pay for historic contamination on the site
• waste—including minimising waste and reusing material onsite as far as possible as well as managing waste arising in accordance with legal requirements
• water pollution—water pollution from construction sites is a major issue
• nuisance claims and noise (these can be the subject of intervention by the local authority—section 60 construction site noise notices—as well as complaints by neighbours)

What environmental provisions are commonly being found in building contracts? How is risk apportioned between the parties?

Environmental provisions in building contracts for relatively sophisticated projects commonly put the responsibility for minimising or avoiding liability relating to environmental issues on the contractor. Although commonly used standard forms of construction contract do not directly refer to specific environmental issues, employers/developers will often introduce provisions through the schedule of amendments.

With regard to contamination, well-advised employers would normally seek to place the risk on the contractor although there is often some negotiation. Contractors will be keener on accepting only ‘known risk’. If, as is usual, a level of risk as to ground conditions is p