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Escrow accounts and escrow agreements

This Practice Note examines why parties involved in a construction project may enter into an escrow agreement (or escrow deed) to set up an escrow...

Build Operate Transfer (BOT) contracts

The Public Private Partnership (PPP) models are a popular way for governments to involve private investment, expertise and risk in procuring...

What is practical completion?

Practical completion marks the end of the construction period of a project, when the works are 'finished' and the employer can occupy and/or use them....

Time at large in construction contracts

This Practice Note examines the concept of ‘time at large’ in relation to the completion of works under a construction contract, including what time...

Practice notes

The prevention principle

This Practice Note considers the meaning and nature of the prevention principle and its relevance to delay claims in construction projects. It also...

Produced in partnership with Tim James Seal 9th Nov

Practice notes

Section 38 and section 278 Highways Act agreements—contractor’s perspective

This Practice Note examines agreements entered into under sections 38 and 278 of the Highways Act 1980, considering the obligations they impose and,...

9th Nov

Practice notes

Defects liability period and rectification of defects

It is common in construction projects for defects to manifest or appear in the works. Most construction contracts require the contractor to return to...

9th Nov

Practice notes

Loss and expense

Claims by contractors for loss and expense arising from a disturbance to progress of the works are one of the most debated and contentious areas of...

9th Nov

In-house

Practice notes

Responsibility for Employer's Requirements

This Practice Note looks at Employer’s Requirements (also referred to as ERs) within a building contract. It explains what Employer’s Requirements are...

9th Nov

Practice notes

Schedules of services

This Practice Note examines the purpose and content of the schedule of services that will usually be appended to a consultant’s appointment entered...

9th Nov

Practice notes

Letters of intent—construction

What is a letter of intent?Letters of intent are used in construction and engineering projects to allow the employer to mobilise a contractor before...

9th Nov

Practice notes

JCT collateral warranties

A collateral warranty is a contract which is collateral to, or sits alongside, the underlying or primary contract (ie the construction contract or...

9th Nov

Practice notes

Sectional completion

What is sectional completion?Where the construction contract splits the works into sections or parts, usually to be started at different times, there...

9th Nov

Practice notes

Liquidated damages in construction contracts

This Practice Note explains what liquidated and ascertained damages (LADs/LDs) are and their purpose in a building contract. It considers the...

9th Nov

In-house

Practice notes

'Pay when paid' and 'paid when certified' clauses

This Practice Note considers ‘pay when paid’ clauses and ‘pay when certified’ clauses in construction contracts, and the relevant provisions of the...

Produced in partnership with Womble Bond Dickinson 9th Nov

Practice notes

Interim payments in construction contracts

This Practice Note provides an overview of what interim payments are, how the right to be paid (usually by monthly or stage/milestone payments) arises...

9th Nov

Practice notes

Breach of natural justice in adjudication

Produced in association with 4 Pump CourtPrinciples of natural justiceIf an adjudicator breaches the rules of natural justice during the adjudication...

9th Nov

In-house

Practice notes

Duty to warn

This Practice Note examines the extent to which contractors, sub-contractors and consultants have a duty to warn their employer of inadequacies that...

9th Nov

Practice notes

Design liability in construction contracts

If a party is said to have ‘design liability’, it means that it bears legal responsibility for all or part of the design of a construction/engineering...

9th Nov

Practice notes

Parties in a construction project

This Practice Note identifies the key parties involved in most construction projects (including the employer, the contractor, the professional team of...

9th Nov

Most recent Q&As content

Q&As

When can a mistake in an executed deed be rectified by a manuscript amendment rather than by a deed of rectification?

This Q&A explains when it is possible to remedy a mistake made in an executed deed by manuscript amendment and the surrounding issues of which to be...

Produced in partnership with Emma Holland of Stewarts Law 29th Nov

Q&As

Where parties to a construction contract disagree about the application of VAT to supplies under the contract, can they resolve that dispute using adjudication under the Housing Grants, Construction and Regeneration Act 1996 provided for in the contract or should they go to HMRC or the First-tier Tax Tribunal?

For the purpose of this Q&A we have assumed that:•the contract is a ‘construction contract’ for the purposes of the Housing Grants, Construction and...

29th Nov

Q&As

What is the VAT treatment of a sub-contractor supplying materials to a contractor to be used in the construction of a zero rated new dwelling?

A supply of building materials on their own is standard-rated for VAT purposes. However, a person who is making a zero-rated supply of services in the...

29th Nov

Q&As

A landowner is selling self-build serviced plots on a multi-unit site. The landowner will not be responsible for construction of the units. The construction will be undertaken by a third party building contractor under a separate agreement from the plot sale agreement. The buyer of each plot will be required under the plot sale agreement to enter into a building contract on or before completion of the plot sale to ensure consistency of development across the site. Will SDLT be due on the payments under the building contract as well as under the plot sale agreement?

Stamp duty land tax (SDLT) is generally calculated by reference to the chargeable consideration given for the subject matter of a chargeable...

29th Nov

Q&As

Does the construction industry scheme apply when the contractors and construction site are based abroad? Note that the contract is governed by UK law, however, the contractors are not British and the site being constructed is also outside of the UK.

The construction industry scheme (CIS) applies to contractors and subcontractors providing or operating under a contract for the provision of...

29th Nov

Q&As

When does the provision in section 6 of the Party Wall etc Act 1996 (notice should be served where excavation within three metres of any part of a neighbouring owner’s building or structure, where any part of that work will go deeper than the neighbour’s foundations) apply? Would it be three metres at any angle or only where the property walls are adjacent?

Section 6 of the Party Wall etc Act 1996 (PWA 1996) applies where:‘ … (a) a building owner proposes to excavate, or excavate for and erect a building...

29th Nov

Q&As

Do you have any information on the implications of building over a building line?

A 'building line' is a prescribed frontage line for building in front of which no new building, other than a boundary wall or fence, may be...

29th Nov

Q&As

Under the Defective Premises Act 1972, is a dwelling constructed for the commercial purpose of a holiday home with planning restrictions limiting occupation to holiday accommodation only, excluded from the definition ‘dwelling house’?

The first duty is imposed by section 1 of the Defective Premises Act 1972 (DPA 1972). Although entitled ‘Duty to build dwellings properly’, its...

29th Nov

Q&As

If a replacement front door has less than 50% glazing, does it require approval under a competent person scheme?

Regulation 12(6) of the Building Regulations 2010 (the 2010 Regulations), SI 2010/2214 (SI 2010/2214, reg 12(6)) states that 'a person intending to...

29th Nov

Q&As

Where there is a claim and a counterclaim and one of the parties wants to make a Part 36 offer to settle both the claim and the counterclaim, is this a claimant's offer or a defendant's offer for the purposes of Part 36?

The standard Form N242 for Part 36 offers provides the option for the offeror to choose whether they are making a claimant's or defendant's offer. In...

29th Nov

Q&As

A developer goes into administration, leaving a number of plots unbuilt. The developer had taken deposits from individual buyers in respect of those plots. Can the plot buyers recover the deposits?

It is likely that the plots will be covered by some sort of new homes guarantee, for example NHBC Buildmark Cover (see Practice Note: New home...

29th Nov

Q&As

Does the landlord or tenant have a statutory obligation to provide a copy of the health and safety file for a property?

The purpose of a health and safety file is to provide information relevant to the works being carried out at the time, but it must also contain...

29th Nov

Q&As

A common amendment made to a transfer of land is to provide that the transferor’s covenant to comply with title matters is ‘by way of indemnity only’. What is the effect of this amendment and in whose interest is it?

A covenant to comply with title matters ‘by way of indemnity only’Where a transfer of land takes place, the parties should effect the transfer using...

29th Nov

Q&As

Is there any argument that an owner of a building is responsible for breaches of building regulations or does a tenant taking on a lease take on any past breaches?

The local authority for the relevant area has a duty to enforce compliance with the building regulations. Where works have been carried out on a...

Produced in partnership with Chris Bryden of 4 King’s Bench Walk 29th Nov

Q&As

Where a developer requires to remove a crane from its development site which will result in road closures and gives a neighbouring operator of a car park in the vicinity short notice of this and the requirement for the car park operator to close certain parking bays for health and safety reasons, what can the car park operator do to safeguard its position in terms of anticipated loss of income as a result closure of the road giving access to the car park and loss of parking bays? The car park operator is a business tenant and has notified their landlord of the issue.

The developer will have required a licence from the local authority in respect of the crane oversailing the highway, and in respect of the consequent...

29th Nov

Q&As

Does a parish council (not being an eligible council under the Localism Act 2011) have the power, when agreeing to transfer council property to a developer, to secure deferred consideration by a taking a legal charge over the property?

We have assumed that the land in question is in England.Local authorities in England and Wales are corporate bodies created by statute of the UK...

29th Nov

Q&As

Is there a financial limit of cover under a new home warranty and if so, what is that limit?

A new home warranty is, in effect, an insurance policy that applies to newly built homes. The developer takes out the warranty, but the homeowner...

29th Nov

Q&As

Can parties agree to contract out of the Party Wall etc Act 1996?

In this Q&A we assume that:•both the tenant and the landlord will fall within the definition of ‘owner’ under section 20 of the Party Wall etc Act...

29th Nov

Q&As

What is the current practice for the issue of EWS1 certificates for a building?

As is set out in Practice Note: Fire safety developments following the Grenfell Tower fire, on 16 December 2019, RICS, the Building Societies...

29th Nov

Q&As

What common law rules apply to party or mesne fences, given they are not covered under the Party Wall etc Act 1996? Deeds often state that maintenance and repair is the joint responsibility of both owners, but what steps are required if a dispute arises as to whether the fence should be changed in any manner?

This question raises the issue of the rights adjoining owners owe one another where a fence separates their lands.The location of boundaries on the...

Produced in partnership with Stephen Murch of 42 Bedford Row 29th Nov