This week's edition of Construction weekly highlights includes the announcement of the release date for the 2024 editions of the Minor Works Building Contract family by the Joint Contracts Tribunal (JCT), two sets of guidance published by the Health and Safety Executive (HSE) in relation to higher-risk buildings, a case in which the Technology and Construction Court (TCC) considered whether an adjudicator had exceeded the scope of the ‘slip rule’ (McLaughlin & Harvey v LJJ), and the publication of the UK Construction Monitor for the first quarter (Q1) of 2024 published by the Royal Institution of Chartered Surveyors (RICS).

This Practice Note summarises the legal principles and provides practical guidance on the enforceability of restrictive covenants and the application of the doctrine of restraint of trade in commercial contracts. Post-termination restrictions in employment contracts are likely to be scrutinised to a greater extent than restrictions in commercial agreements and so, generally, parties to a commercial agreement are likely to have greater flexibility to contract than parties to an employment contract. However, each restriction should be considered in its context. See What is reasonable? below. For information on restrictive covenants in an employment context, see Practice Note: Restrictive covenants in employment—a guide to our materials. For information on restrictive covenants in a property context (which is outside the scope of this Practice Note), see: Restrictive covenants—overview and Restrictive covenants for property disputes lawyers—overview. What is the doctrine of restraint of trade? The common law seeks to protect the freedom of parties to trade but balances this against their freedom to contract. Generally speaking, the tension between these two competing freedoms is

This Practice Note sets out the legal position if a party disposing of an interest in land (the seller) is not registered as the proprietor at HM Land Registry and has either: • made an application to be registered as the proprietor, or • has not made such an application, but compulsory registration has been triggered (either by the transfer (or grant) to the seller, or by an earlier transaction) It provides practical tips on carrying out due diligence for the acquiring party in these circumstances. The issues raised are of particular importance for a party acquiring a registrable interest in land, as it needs to ensure that it can register its interest at HM Land Registry as soon as possible following completion (and where appropriate, within the relevant priority period). This Practice Note does not cover investigating title to unregistered land—see instead Practice Notes: Deducing title to unregistered land—compulsory first registration, party to register, evidence of title, good root of title and unbroken chain of ownership and Deducing

ARCHIVED: This Practice Note has been archived and is not maintained. This Practice Note summarises the key appeal cases (ie decisions of the Court of Appeal and Supreme Court, and, where relevant, some judgments of the Court of Justice of the EU (CJEU)), which we have reported on, allowing users ease of access in finding those decisions. This content can be browsed through the expandable table of contents in the left margin and/or by following the hyperlinks in the list below and the cases are divided into the following sections: • Key DR Developments ◦ Brexit • Applicable law ◦ Rome I • Jurisdiction ◦ Jurisdiction/choice of court agreements ◦ Stays and disputing the court’s jurisdiction ◦ Brussels I (EC regulation) ◦ Brussels I (recast) (EU regulation) • Service ◦ Service in the jurisdiction ◦ Service of documents in family proceedings outside the jurisdiction (pre-DDSA 2020) • Pre-action and limitation ◦ Limitation • Claims and remedies ◦ Forming enforceable contracts ◦ Contract interpretation ◦ Dispute resolution: key appeal

Contracting parties The general rule under the common law doctrine of privity of contract is that the terms of a contract can only be enforced either by or against someone who is a party to the contract. Therefore one option is to structure the contract so that each of the promisees are party to it, and then incorporate an obligation upon the promisor to deliver the services to each of the promisees. In such circumstances, regard should be had to the consideration under the contract given by each of the promisees. For more on consideration, see Practice Note: Forming enforceable contracts—consideration. In such circumstances, whether the contractual obligation is discharged fully will be a matter of construction of the express contractual obligation and fact. Contracts and third-party rights The Contracts (Rights of Third Parties) Act 1999 (C(RTP)A 1999) permits a third party to enforce

When a plot of land is subject to a number of leases it is common for the landlord to reserve the right to deal with such parts of it as are not demised. This might extend to a right (such as it would be required) to grant further leases or to impose regulations as to the extent to which the tenants might use or enjoy those other parts without having exclusive possession of them under the terms of the leases. For these purposes it will be necessary to identify the land over which the landlord has those rights. Alternatively, the concept might be used as a means

The effective date for most land transactions will be the date of completion (note completion is not defined in the SDLT legislation although HMRC guidance states that completion means the completion of the land transaction proposed by the contract between the same parties in substantial conformity with the contract). A person is not regarded as entering into a land transaction by reason of entering into a contract to acquire UK land. However, there are special SDLT rules which apply where a contract for a land transaction in entered into. In particular, the effective

1 Sanctions (long form) In this clause 1, the following defined terms shall have the meanings assigned to them: Losses • means all damages, liabilities, demands, costs and expenses[ including all legal and other professional fees, costs and expenses], claims, actions and proceedings[ (including all consequential, direct, indirect, special or incidental loss or punitive damages or loss, fines, penalties, interest and loss of profit or any other form of economic loss (including loss of reputation))]; Sanctioned Activity • means any activity subject to sanctions imposed by a Sanctioning Body; Sanctioning Body • means the United Kingdom, United States of America, United Nations, European Union and any other applicable local, national or multinational government agency, department, official, parliament, public or statutory person or any government or professional body, regulatory or supervisory authority, board or other body responsible for imposing and/or administering sanctions; Sanctioned Entity • means any person or entity which is, or which is owned or controlled directly or indirectly by a person or entity which is, the subject of sanctions imposed by, or on a designated sanctions list published by, a Sanctioning Body, and in this clause 1, the words ‘owned or

The Financial Conduct Authority (FCA) has announced that it has received a legal challenge to its decision to award the contract for the bond consolidated tape (CT) provider. The FCA says the challenge means it can’t enter into a contract with the successful bidder as quickly as planned.

What is novation and step-in and why might it cause an issue to an existing collateral warranty? Construction lawyers generally refer to novation transferring one party’s rights and obligations under a contract to another party. However, the actual legal position is that on novation the original contract is extinguished and it is replaced with another, usually identical contract under which the new party takes up the rights and obligations of the party that has stepped out of the original contract, see Practice Note: Novation—why and how to novate a contract. This could cause an issue for a party (in this case a tenant) that has received a warranty before the novation took place because the underlying professional appointment to which the warranty relates is essentially extinguished. Whether that original warranty is enforceable will

A purchaser's equitable lien is a form of security that arises when a contract for sale is made. It protects part payments made by the buyer, such as a deposit. In Williams v Alter Domus Trustees (UK) Ltd Mr Justice Miles set out the following principles applicable to equitable liens: ‘i) The purchaser's lien arises in equity to give the purchaser protection for any part-payments made under a contract to acquire an estate in land. ii) The lien is in the nature of an equitable charge. It extends to part payments, interest and costs thrown away. iii) It arises by operation of law and depends on there being an enforceable contract, but does not arise from the express terms of the contract and is not a implied term of the contract. iv) The lien may be excluded or postponed to other security

This Practice Note outlines the considerations for a creditor which has been trading with a business partner which owes it money or is in financial distress or insolvency. It identifies the contractual options, commercial options, steps for debt-collection, and advice on protecting its position as a creditor in an insolvency process. Spotting the warning signs Generally, trade creditors are often the last to know if a company with which they are trading is struggling financially. It is not always easy to evaluate whether the assurance that ‘the cheque is in the post’ is in fact a true statement or masking a much bigger problem. Although the financial accounts of large public companies may be publicly available and provide a large amount of information, some of which is legally required and some volunteered, the financial statements contained within them are essentially a record of past financial performance. The company’s management accounts are the more useful tool to examine, as they contain future estimates and forecasts of revenue, costs and profits analysed,