Contractual Procedures in the Construction Industry

Allan Ashworth, Srinath Perera

• Publisher: Routledge
• Year: 2018
• ISBN:
  9781315529035
• Edition: 7
• Topic: Technik & Maschinenbau
• Subtopic: Bau- & Architekturtechnik

Contractual Procedures in the Construction Industry 7th edition aims to provide students with a comprehensive understanding of the subject, and reinforces the changes that are taking place within the construction industry. The book looks at contract law within the context of construction contracts, it examines the different procurement routes that have evolved over time and the particular aspects relating to design and construction, lean methods of construction and the advantages and disadvantages of PFI/PPP and its variants. It covers the development of partnering, supply chain management, design and build and the way that the clients and professions have adapted to change in the procurement of buildings and engineering projects.

This book is an indispensable companion for students taking undergraduate courses in Building and Surveying, Quantity Surveying, Construction Management and Project Management. It is also suitable for students on HND/C courses in Building and Construction Management as well as foundation degree courses in Building and Construction Management.

Key features of the new edition include:

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• A revised chapter covering the concept of value for money in line with the greater emphasis on added value throughout the industry today.

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• A new chapter covering developments in information technology applications (building information modelling, blockchains, data analytics, smart contracts and others) and construction procurement.

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• Deeper coverage of the strategies that need to be considered in respect of contract selection.

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• Improved discussion of sustainability and the increasing importance of resilience in the built environment.

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• Concise descriptions of some the more important construction case laws.

Contents

List of Figures

List of Tables

List of Boxes

Preface

Acknowledgements

Table of relevant statutes (Acts of Parliament)

PART 1
Contract law

1 The English legal system

1.1 The nature of law

1.2 Classification of law

1.3 Sources of English law

1.4 The courts

1.5 The lawyers

1.6 Modernisation

1.7 Some legal jargon

2 Legal aspects of contracts

2.1 Definition of a contract

2.2 Agreement

2.3 The elements of a contract

2.4 Offer and acceptance

2.5 Form

2.6 Consideration

2.7 Duress and undue influence

2.8 Unenforceable contracts

2.9 Mistake

2.10 Misrepresentation

2.11 Disclosure of information

2.12 Privity of contract

2.13 Express and implied terms

2.14 Limitations of actions

2.15 The Unfair Contract Terms Act 1977

2.16 Contra proferentem

2.17 Collateral warranties

2.18 Agency

2.19 Subcontracting, assignment and novation

3 Discharge of contracts

3.1 Discharge by performance

3.2 Discharge under condition

3.3 Discharge by renunciation

3.4 Discharge by fresh agreement

3.5 Frustration

3.6 Determination of contract

3.7 Assignment

4 Remedies for breach of contract

4.1 Nominal damages

4.2 Substantial damages

4.3 Remoteness of damage

4.4 Special damage

4.5 Liquidated damages

4.6 Unliquidated damages

4.7 Specific performance

4.8 Injunction

4.9 Rescission

4.10 Quantum meruit

5 Settlement of disputes

5.1 The reasons why disputes arise

5.2 Issues for the resolution of disputes

5.3 Claims

5.4 Adjudication

5.5 Arbitration

5.6 Litigation

5.7 Alternative dispute resolution

PART 2
Procurement

6 Forms of contract

6.1 The standard form of contract for building works

6.2 Types of contract envisaged

6.3 Employer and contractor

6.4 Main contract forms

6.5 Joint Contracts Tribunal (JCT) forms 2016

6.6 JCT agreements

6.7 JCT contract guides

6.8 Other main forms of contract

6.9 The Housing Grants, Construction and Regeneration Act 1996

6.10 Other contractual documentation

6.11 Appointment of consultants

7 Contract strategy

7.1 Industry analysis

7.2 The use of construction contracts in the industry

7.3 Major issues to be resolved

7.4 The framework of society

7.5 Employers’ essential requirements

7.6 Procurement management

7.7 Coordinated project information (CPI)

7.8 Added value

7.9 Conclusions

8 Contract procurement

8.1 Methods of price determination

8.2 Measurement contracts

8.3 Cost reimbursement contracts

8.4 Contractor selection

8.5 Contractual options

8.6 Review

9 Contract selection

9.1 Employers’ requirements

9.2 Factors in the decision process

9.3 Conclusions

10 Contract documents

10.1 Form of contract

10.2 Contract drawings

10.3 Contract bills

10.4 Contract specification

10.5 Schedule of rates

10.6 Master programme

10.7 Information release schedule

10.8 Contractual provisions

11 Design and build

11.1 Design and build practice

11.2 Advantages and disadvantages

11.3 Choice of design and build

11.4 Contractual arrangements

11.5 Procurement: three main methods

11.6 Selection factors

11.7 Use worldwide

11.8 Design and manage

11.9 Partnering

11.10 Public private partnerships

11.11 Form of contract

11.12 Conclusion

12 Procurement in the twenty-first century

12.1 Relevant published reports

12.2 Employers’ main requirements

12.3 Major considerations

12.4 Procurement selection

12.5 Current considerations

12.6 Carbon pricing

12.7 Risk analysis and management

12.8 Other industry comparisons

13 Lean construction

13.1 Lean manufacturing

13.2 Production and management principles

13.3 Design and product development

13.4 Lean production

13.5 Supply chain management

13.6 Benchmarking

13.7 Lean thinking construction

13.8 Case studies

13.9 Conclusion

14 Public private partnerships (PPP) and the private finance initiative (PFI)

14.1 Reasons for change

14.2 Public private partnerships

14.3 Private finance initiative (PFI)

14.4 Advantages of PPP/PFI procurement

14.5 Disadvantages of PPP/PFI procurement

14.6 The Priority School Building Programme (PSBP)

14.7 Value for money (VfM)

PART 3
Process and parties

15 Partnering and supply chain management

15.1 Partnering

15.2 Categories of partnering

15.3 Evaluating partnering

15.4 Summary of partnering

15.5 Supply chain management

15.6 The underlying principles of supply chain management

16 The construction process

16.1 Demand for development

16.2 Marketing

16.3 Customer satisfaction

16.4 Site identification

16.5 The development process

16.6 Feasibility and viability

16.7 In use

16.8 Demolition

16.9 Environmental impact assessment

16.10 Neighbourhood environmental data

17 Parties involved in the construction industry

17.1 Employers

17.2 Landowners

17.3 Professional advisers

17.4 Contractors

17.5 Regulation

17.6 Direct labour

17.7 Professional bodies

17.8 Construction associations

17.9 Industry skill needs

18 Site communications

18.1 Communication principles

18.2 Site information

18.3 Site meetings

18.4 Site diaries

18.5 Planning and programming

19 Constructing excellence in the built environment

19.1 Constructing the Team (the Latham Report)

19.2 Rethinking Construction (the Egan Report)

19.3 Rethinking Construction achievements

19.4 Construction Best Practice

19.5 Constructing Excellence

20 Health, safety and welfare

20.1 The construction industry

20.2 Health and safety in the construction industry

20.3 The Health and Safety at Work Act 1974

20.4 The Construction (Design and Management) Regulations 2007 and 2015

20.5 The Construction (Health, Safety and Welfare) Regulations 1996

20.6 Management of Health and Safety at Work Regulations 1999

20.7 Health, safety and welfare in contract documents

21 Sustainable development and construction

21.1 The concept of sustainability

21.2 The construction industry

21.3 Sustainable development

21.4 Environmental impact assessment

21.5 Sustainable business

21.6 Case study: the Swiss Re headquarters

21.7 Building resilience

21.8 Sustainability and contractual procedures

22 Information communication technologies in construction procurement

22.1 The fourth industrial revolution

22.2 E-procurement

22.3 Building information modelling (BIM)

22.4 The Internet of Things (IoT)

22.5 Big data analytics

22.6 Blockchain technology and crypto currencies

22.7 Smart construction and smart contracts

22.8 Future directions

PART 4
Principles of the conditions of contract

23 Introduction, articles of agreement, appendix

23.1 Articles of agreement

23.2 Settlement of disputes – adjudication

23.3 Attestation

23.4 The appendix

24 Quality of work during construction

24.1 Statutory requirements

24.2 Setting out of the works

24.3 Work, materials, goods and components

24.4 Royalties and patent rights

24.5 Person in charge

24.6 Access to the works

24.7 Clerk or inspector of works

25 Costs of construction

25.1 Contract sum – adjustments to the contract

25.2 Variations, change orders and provisional sums

25.3 Variation instruction – contractor’s quotation in compliance with the instruction

25.4 Contract sum

25.5 Materials and goods unfixed or off site

25.6 Damages for non-completion

25.7 Loss and expense claims

25.8 Valuations, certificates and payments

26 Time factor of construction

26.1 Practical completion

26.2 Partial possession by employer

26.3 Date for possession, completion and postponement

26.4 Extension of time

26.5 Termination by employer

26.6 Termination by contractor

26.7 Termination by employer or principal contractor

27 Works by other parties

27.1 Assignment and subcontracts

27.2 Works by employer or persons employed or engaged by employer

27.3 Named or nominated subcontractors

28 Injury and insurance of the works

28.1 Injury to persons and property and indemnity to the employer

28.2 Insurance against injury to persons and property

28.3 Insurance of the works

28.4 Erection of new buildings – all-risks insurance of the works by the contractor

28.5 Erection of new buildings – all-risks insurance of the works by the employer

28.6 Insurance of existing structures – insurance of the works in or extensions to existing structures

28.7 Insurance for the employer’s loss of liquidated damages

28.8 Joint fire code

29 Fluctuations in costs

29.1 Fluctuations

29.2 Contributions, levy and tax fluctuations

29.3 Labour and materials costs and tax fluctuations

29.4 Use of price adjustment formulae

30 Financial matters

30.1 Value added tax (VAT)

30.2 Construction industry scheme

31 Clauses of a general nature

31.1 Interpretations, definitions, etc.

31.2 Contractor’s obligations

31.3 Instructions

31.4 Contract documents

31.5 Antiquities

31.6 Settlement of disputes

Appendix A

Appendix B

Appendix C

Bibliography

Index

Figures

1.1 The court system.

2.1 The elements of a contract.

6.1 JCT forms of contract 2016.

6.2 Guide to selecting the appropriate JCT main contract.

6.3 Trends in forms of professional appointments.

7.1 Use of popular standard forms of contract.

7.2 Forms of professional appointments.

7.3 Use of e-tendering in the last twelve months reported by NCCL Survey 2015.

7.4 State of BIM in construction contracts.

7.5 Value of contract v. type of contract.

7.6 Contractual terminology: (a) expected contractual position, (b) likely contractual position.

8.1 Traditional relationships.

8.2 Design and build relationships.

8.3 Construction management relationships.

8.4 Project management relationships.

8.5 Different contractual arrangements and their effects upon time.

9.1 Client’s main requirements (%).

9.2 Range of contract types.

13.1 Lean construction.

14.1 PPP models: private and public sector risk.

14.2 Typical PPP/PFI organisational structure.

14.3 PPP payment system.

14.4 Traditional vs PFI cost to client.

14.5 PFI project portfolio in the UK.

14.6 VfM in PPP/PFI projects.

17.1 The construction industry profile.

17.2 Construction skills network forecasts 2017–2021.

18.1 Site diary.

19.1 CBPP cycle.

19.2 CBPP action plan.

19.3 Engagement.

20.1 Fatal injuries to workers by main industry.

20.2 Analysis of fatal injuries in the construction sector.

20.3 Standardised incidence rates (per 100,000 employees) of fatal injuries at work for 2014.

20.4 Analysis of non-fatal injuries in the construction sector.

21.1 The triple bottom line approach.

21.2 Factors to consider in sustainable construction.

21.3 Overview of the Sendai Framework 2015–30.

22.1 Chronology of industrial revolutions.

22.2 The scope of IoT @home.

22.3 Data hierarchy in the context of construction.

22.4 Bitcoin can represent any property.

22.5 A typical construction blockchain network.

25.1 Valuation of variations.

Tables

5.1 Characteristics of dispute resolution

7.1 Trends in methods of procurement (by value of contracts)

7.2 Trends in methods of procurement (by number of contracts)

7.3 Trend in use ...