QS

For Quantity Surveyors

EYE
SPRING 2012

QSi Second Annual Conference

7th November 2012 - University of Wolverhampton
POST PARTNERING
Back To Lowest Price and Claims - Making the Best of it
Session 1 - Cost Reduction on Government Session 5 – Is PFI/PPP Finished or Will LABV Save
Projects its Bacon?
• Government’s plans to reduce construction • Models
costs by 20% before 2015 • Pros and cons
• Price Benchmarking and Cost Targeting • Comparisons between PFI/PPP and LABV
• Incentivised programme • Added Value
• Integrated supply side • Socio economic regeneration
• Use of Standard Forms with few amendments
• Employing “trained civil servants” to lead the Session 6 - Staying Afloat Financially
construction team • Fully detailed applications for payment
• Front loading stage payments
Session 2 - Building Information Modelling (BIM) • Maximising value of variations
• What is it? • Early warning of delay and disruption claims
• Who will be inputting into the design? • Suspension of work – is it effective?
• Who will be able to afford the set up costs?
• Will it result in significant overall cost savings? Session 7 - Contractor’s Insolvency
• Who will take the blame if things go wrong? • Entering administration
• Securing the site
Session 3 - Government’s Green Deal • Retention of title on site materials
• What is it? • Payment obligations
• How much work will it provide for the • Additional cost to complete and other
construction industry? problems
• What will be the cost?
• What is the pay-back period? Session 8 - Formal Dispute Resolution - the Truth
• How will it affect energy prices? • Mediation
• Adjudication
Session 4 – Public Sector Procurement – Where Did • Litigation
it All Go Wrong? • Arbitration
• Are the Public Contracts Regulations too • What does it cost?
woolly? • What are you likely to recover?
• Lowest price or most economically • What are realistic time scales
advantageous?
• What should go in the OJEU Notice? For further information please visit our website at
• Are the judges getting it wrong? www.theqsi.com/seminars.asp or
• Is it in danger of becoming a lawyers’ bonanza? email [email protected]

To join the QSi please visit our website www.theqsi.com

Designed by The Print Concierge. Tel: 07703 033649 e:[email protected]
RELEASE OF SUBCONTRACTORS’
RETENTIONS by Dr Derek Ross
I suspect that many main contractors will be in for retention during the
a nasty shock in respect of subcontractors’ bulk of its main
retentions when the implications of recent contract defects
amendments to the UK Construction Act finally correction period, if its
sink in. Up to now it has been usual for subcontractors are
construction subcontracts to stipulate that the final minded to avail of this,
moiety of a subcontractor’s retention is not due for probably fleeting,
release until after the main contractor has received window of opportunity.
a Certificate of Making Good, or some such Whether
document, under the main contract. However, subcontractors will, of
such a provision in a subcontract made in England course, is another
or Wales since 1 October 2011, or in Scotland matter.
since 1 November 2011, is no longer compliant Dr Derek Ross
with the Act, and the implications are worth noting. 26 March 2012

The Act has always required construction contracts Please Note: The foregoing article has been
to contain an adequate mechanism for determining prepared by Dr Derek Ross for the general interest
what payments become due under the contract, and benefit of readers. It is not intended to be a
and when. The Act now states that this definitive analysis of the law or of other matters
requirement is not satisfied where the construction discussed. Neither does it create a client relation-
contract makes payment conditional on the ship between the recipient and Dr Ross. Thus no
performance of obligations under another contract liability is accepted in respect of any reliance
(see s.110(1A)), other than a subcontract of the placed on any statements made in the foregoing
construction contract (see s.110(1C)). This gets article. Proper advice ought always to be taken
rid of the main contractors’ dodge of using ‘pay before deciding to take, or not to take, action in
when certified’ clauses to perpetuate ‘pay when respect of a specific issue.
paid’ clauses, which, for the most part, the Act
outlaws. Thus, whilst a main contractor’s © 2011 Dr Derek Ross & Layng Ross Construction
entitlement to payment is still dependent of the Disputes Resolution.
performance of its subcontractors, the
subcontractors’ entitlement to payment can no
longer be made dependent upon the main
contractor’s performance under the main contract.
Where subcontracts recently entered into still try,
the relevant parts of the Scheme for Construction
Contracts will apply in respect of payment due
dates instead.

Applying this to the release of subcontractors’

retentions, paragraphs 5 & 6 of Part 2 of the
Scheme stipulate that the final payment under a
construction contract ‘shall become due on the
expiry of 30 days following completion of the
works’, which in this case means completion of the
subcontract works. Thus any main contractor, who
in the past six months has tied the release of its
subcontractors’ retentions to an event under the
main contract, rather than to an event under each
individual subcontract, may find itself holding
considerably less by way of subcontractors’

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Page 02 - QSi Spring 2012
Pay Less Notice as Referred to In the New Construction Act
Exchange of Correspondence With the JCT
Dear Mr
Knowles,
Your 23
February
letter to
The slight Peter Hib
delay in berd has
and also re been pa
to a subs sponding owes to ssed to m
e as edito
same qu eq the fact th
estion, th uent series of th at it was r of JCT
2005 an
Magazin e first tw ree artic originally d 2011.
e copy en o by asso les from sent to R
closed). ci ates and Th om as Egga IBA rath
They wer
e not en
the third
from Mar r in various pu er than here
tirely cons k Clinton bl ic
the reva
luation su is (in this w ations on the
another ggestion tent with each ot eek’s Bu
ilding
monthly on the he he
payment ad, pointin r but, as you’ll se
As the co has beco g out that e, the third
urts occa me due, if the pay one does
interpret sionally it would le ss no ap pe
JCT’s co po pr ob ably beco tic e ar to hit
Victoria ntracts – inted out to my pr me a ‘pay can be given afte
Peckett or, a forti edecesso more’ no r
will no do or
Under SB ubt let us i, statute law. Bu rs, it’s for them, no tice.
C clause know if sh t in my vi t for the
Contract 4.4, DB e disagree ew the sh JCT, to
Sum afte clause 3. s – is that ort answ
r due da 3 valuatio the issue er – and
Yes, ther te are to ns, asce is a nons
e is ambi be taken rtainmen ense.
into acco ts
110(B)(3
) and 11
guity in th
e new se unt in the and other adjust
1(9)(b) – ct next mon ments to
sub-sect
ion 111( but if you ion 111 – just as thly valu
at
the
3) it is qu read sub- th ion, not be
period co
vered by ite pl section 11 ere is poor draftin fore.
the notifie ain that it is sim 1( g
period.
d sum in ply talkin 4) in conjunction in sections 108A
g about ,
The poin
an amou
nt less th a cheque with the governin
t of the Ac an that su or bank g
drafting t here was m, not a transfer
changes payment for th
non-pc te wer to change for some e
rms such e needed in the section 11
0, not sectio
other
as withho latter as n 111, th
I think it lding. a result, ough cons
is safe to perhaps
monthly sa made m equentia
valuation y that Parliamen ore difficu
lt by avoi
l
the paye an d paymen t did not in dance of
r to pay t cycles or te nd to change
default no more – or , in or
possibly th e in
tic
second su e, or deferral of to have to context of pay le terrupt proper, co
a certific gi ss nv
results at
m due is
! Nor is it ate for th ve a notice when, notices in month entional
e extra 5 two, requ
different
levels of
likely to
have inte days, the through a late ap ire
It is not an the supp nded som payer do plication
issue that ly chain. ething th esn’t even or
telling hi I would w at might know wha
m clearly ish to argu pr od uc e widely t the
difficult to what am e in front differing
get a de ount he of the TC
claration is to
of invalid get for the releva C. If the
pa yee gets
But do le ity. nt period a notice
t us know and why in time
if you he , he is go
ar of any ing to fin
Yours si further de d it
ncerely, velopmen
ts.
Alastair
Robertson

Reads across

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QSi Spring 2012 - Page 03
 The Administrator’s View
With green issues and lower carbon emissions high on the construction agenda, I
thought our readers may be interested in how the transportation industry is
tackling the problem with some lateral thinking.
Transport apparently accounts for 15% of all global greenhouse emissions, with a
45% increase seen between 1990 and 2007. A further 40% is currently predicted
by 2030. So what’s the answer?
The most obvious solution is to reduce the number of miles which transport covers
when empty. So route planning has become a fundamental of the transport
system in many businesses. Additionally, many organisations are building more warehouses in order to
reduce the number of miles travelled. The constant rise in oil prices, has led companies to reconsider the
location of its production. Where this was moved out to Asia at the end of the last century, many are now
bringing it back home.
Packaging is another issue. By reducing packaging, the load is lightened, for example a wine importer
now brings in the wine in tankers and bottles it here in the UK. This has reduced carbon emissions by
almost half.
So what else is happening? In Holland, goods are being shipped to port by barge. Others are opting for
the rail alternative. However, by far the cleanest mode of transport is sea, and many have replaced their
air freight with container ships. This is of course much slower, and requires companies to plan ahead to a
far greater degree.
Not content with already holding the prize for cleanest mode of transport, the shipping industry is looking
for ways to reduce emissions even further. Biofuels are under investigation, sails and solar panels are
being fitted to freight ships, and special paints are being formulated.
Much freight however remains on our roads. Progress is being made though with increased use of
electric vehicles and hybrids. These are not only good for the environment, but significantly reduce
costs. Even McDonald’s is doing its bit, now recycling a large proportion of its cooking oil to create
biodiesel for its trucks. Suzanne Cash
What are you doing? Administration Manager

The British Border

Patrol is asking BORDER PATROL ALERT!!!!
citizens to keep on
the lookout for a
red 1951 Chevy
that they suspect is
being used to
smuggle illegal
immigrants from
Calais to Dover,
through the
Channel Tunnel.

If you see the

vehicle pictured
and have reason to
believe that it is the
suspect vehicle,
you are urged to
contact your local
police.

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Page 04 - QSi Spring 2012
Advice From Claims Consultants- Is It Subject
to the Rules of Legal Professional Privilege?
In accordance with CPR Part 31.15 there is in legal civil alleged that four of the documents had mistakenly been
proceedings a right of inspection relating to documents in disclosed and as they attracted legal professional privilege
the possession of the opposing party. Upon written notice should not have been included in the trial bundle. The two
a party is entitled to inspect any document which is consultants acting for Knowles, Andrew Rainsberry and
disclosed. A court order for disclosure can be made in Adam Tomlinson are both non practising barristers and
respect of documents which are not disclosed. therefore DMD’s solicitors considered that they were
The exception to the rule relates to documents which are entitled to claim legal professional privilege.
the subject of legal professional privilege. This is a
fundamental principle of justice and grants a protection This matter has been aired before the courts on a number
from disclosure, which attaches to a client and affects of occasions. In the case of R (Prudential plc and or
confidential communications between lawyers and their another) v Special Commissioner of Income Tax (2010)
clients for the purposes of giving or receiving legal advice. Lord Justice Lloyd in the Court of Appeal who gave the
Documents which may or may not be the subject of Legal lead judgement said:
Professional Privilege was an issue in the case of Walter “I consider that this court is bound to hold that LPP (legal
Lilley and Company Ltd v McKay and DMW Developments professional privilege) does not apply at common law in
Ltd (2012). The case arose out of a contract let by DMW to relation to any profession other than a qualified lawyer, a
Walter Lilley and Company for the construction of a barrister or solicitor
substantial house in London for Mr and Mrs McKay. The
Architect, Barrett Lloyd Davies Associates (BLD) was The judge Mr Justice Akenhead considered he had to
retained in connection with the project together with decide whether Knowles were engaged as solicitors or
Gardner and Theobald the QS firm. There were significant barristers. There was no suggestion that Knowles as a firm
delays to the project and BLD was inclined to grant were qualified or certified to provide legal advice. It was
extensive extensions of time for completion. Mr and Mrs argued on behalf of DMW that a client who in good faith
McKay became disillusioned with BLD and appointed instructs an organisation which he mistakenly believes is a
Knowles Ltd to provide them with advice. Knowles in their qualified solicitor or barrister and then receives legal
conditions of appointment quoted rates for Senior advice from them is entitled to legal protection.
Consultants and Secretarial Support as well as
It seems that one of the main factors in the judge arriving
“Advocate /Director /Legally Qualified Person (and) at his decision was that the conditions of appointment
Adjudication Manager/Delay Analyst/Expert Witness” under which Knowles operated, required them to provide
contractual and adjudication advice and it was noted that
Clause 11 of the Conditions of Appointment stated they were not retained to provide legal advice. Further, in
the rates quoted in the conditions of appointment, there
“ In cases where it appears to the Company that this were no rates offered for barristers or solicitors. The
appointment may or is likely to result in a need for the conditions also referred to a procedure for the
Client to appoint Solicitors to act for, advise or otherwise appointment of a solicitor, which adds to the argument
provide a service to the Client then by this appointment that Knowles were not providing legal advice. The judge
the Client appoints the Company as the Clients’ agent for concluded that Knowles were not engaged as solicitors or
the purpose of assisting in the definition of the scope of barristers, even though Messrs Rainsberry and Tomlinson
the conduct of the Solicitors and for the purpose of were both barristers, therefore the documents produced
inviting suitable Solicitors to approach the Client direct by Knowles did not attract legal professional privilege.
with a view to them receiving whatever instructions the
Client may choose to give such Solicitors in this regard” It would have been interesting to see what the court would
have decided if Knowles had indicated in its conditions of
The claimant considered that based upon disclosed appointment that it would provide legal advice and that
documents a strategy was applied between Knowles and the advice was to be provided by Mrs Rainsberry and
Mr McKay by which the authority of BLD was constantly Tomlinson.
monitored, whereby the claimant was manoeuvred into a
position in which it could be held liable for any delays. Gordon Banks
Some of the correspondence to and from Knowles was
disclosed by DMW’s solicitors, but it seemed to them,
during the disclosure process, that much of the Knowles
documentation attracted legal professional privilege. They

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QSi Spring 2012 - Page 05
 Nomination-Has the JCT Got it Right This Time?
Architects in general like to have the power to choose the amount of risk being carried by the employer relating
subcontractors who will be engaged by the main to nominated subcontractors work and no doubt as a
contractor to undertake some of the specialist work on a result of the many complaints concerning the complexity
project. M and E and external cladding regularly fall into of the process. The provisions in JCT 80, regarding the
this category. How does the contract deal with the inclusion of a list of at least three specialists in the
procedure and who carries the time and cost burden if contract documents were retained. The contract refers to
things go wrong? In pre- JCT 80 times, a PC sum was these specialists as being engaged as subcontractors but
included in the contract and the contractor invited to there is no reference to them being domestic
include in his tender for profit and the provision of subcontractors. There seems no relevance to this as the
attendance. The Architect in due course instructed the contractor appears to be fully responsible for their
contractor to place an order with his chosen subcontractor, performance in like manner to that of a domestic
styled a nominated subcontractor and the PC sum subcontractor. The naming of three or more in the
replaced with the sum included in the quotation. contract is the only method available to the Architect or
Contract Administrator in JCT 2005 and its successor
This system was applied successfully where JCT 63 and JCT 2011, for selecting a specialist.
earlier versions were used; however difficulties of a
contractual nature began to surface. There had always In the never ending saga, the JCT has announced a new
been an entitlement for the contractor to be granted an change, styled the Named Specialist Update which was
extension of time, if delays had been caused by the published in February of this year. The change provides
nominated subcontractor. However who was responsible an additional method of selecting a specialist to the sole
for the subcontractor’s design faults and the delay costs method included in JCT 2005 and JCT 2011 of listing
and responsibility for defects where the subcontractor three or more in the contract documents. The update
became insolvent? A number of high profile legal cases goes back to providing for the naming of a single
grappled with these problems. The JCT attempted to specialist to carry out specialist work. The person who is
clarify matters when drafting JCT 80. Provisions were set to carry out the specialist work referred to as a Named
out in the contract which spelt out that specialist work Specialist may be named in the Contract Particulars, the
could be undertaken either by a specialist named in the work being referred to as Pre-Named Specialist Work.
contract documents, or as a result of the expenditure of a There is as an option; a provisional sum to be included in
provisional sum included in the contract for the work, or by the contract, in respect of the work, referred to as
means of a variation. A lengthy and complex system was Post – Named Specialist Work to be carried by a Named
introduced into the contract to operate the nomination Specialist in accordance with the Architect or Contract
procedure, which included standard tender forms, Administrator’s instruction. The revision introduces an
subcontract conditions, warranty agreements, conditions extension of time and loss and expense entitlement if the
covering payment of the subcontractor, subcontractor’s Named Specialist becomes insolvent or has its
insolvency, termination and re-nomination, all of which subcontract terminated by the main contractor in
were mandatory. Unfortunately whilst these conditions accordance with the terms of the subcontract.
were intended to cover all eventualities, they left many of
those responsible for their use totally confused. An The contract with the latest revision, seems to bring us
alternative method of selection of a subcontractor by the back to the requirements of JCT 80, of either naming at
Architect was provided in JCT 80 in the form of naming least three in the contract documents leaving the
persons included in the contract documents for the contractor to make the choice from the list, or a single
purpose of carrying out specific specialist work. The person named in the contract, or a provisional sum where
contract requires a list to be provided of at least three the work is to be carried out by a specialist in accordance
names, from which the contractor makes a choice. The with an instruction of the Architect or Contract
subcontractor is referred to in the contract as a domestic Administrator. However whilst the power of selection
subcontractor with the main contractor wholly responsible seems to take us back to JCT 80, the complex procedure
for the performance of the specialist in the same manner has not been re-introduced. Does this mean a return visit
as any other domestic subcontractor. There is not even an to the court for answers to questions which invariably will
entitlement to an extension of time where delays have arise?
been caused by the specialist.
The Editor
The JCT took the decision when producing JCT 2005 to
scrap totally the nomination procedure, probably due to

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Page 06 - QSi Spring 2012
 NEW RULES OF
MEASUREMENT
The RICS, our much older rival, has recently done
what it does best, produced some new rules of
measurement. All QSs are familiar with the SMM, March 2012
which has been produced by the RICS for longer Spring is here and so are more employment law
than anyone can remember. The RICS has now changes for employers to grapple with. The
produced the New Rules of Measurement (NRM) in qualifying period for an employee to bring a
three volumes, which includes an element of claim of unfair dismissal will increase from 1-2
updating of existing, together with something years on 6th April 2012. The changes are part of
completely new and comprises: the Coalition’s Red Tape Challenge, intended to
trim back employment law that businesses are
NRM 1 -This was first published in 2009 and deals
with the order of cost estimating and planning for often burdened with. The changes mean that
capital building works and has been updated to employees will have to have been in continued
capture best practice and documents in a single employment with a company for at least two
reference source. The BICS has produced a 4th years to be able to make an unfair dismissal
Edition of the Standard Form of Cost Analysis which claim. However the new rule will apply only to
is aligned with NRM1. new employees starting employment on or after
6th April 2012. Therefore any employees that
NRM 2- The intention of this document is to supplant were employed before this date will still be able
SMM7 which will be discontinued in 2013. NRM2 is a to claim for unfair dismissal with a qualifying
set of detailed measurement rules, which enables
period of one year.
work to be tendered for, either through the medium of
a bill of quantities, or a schedule of rates and is
intended for use on capital works or maintenance The HR Dept reminds employers not to get their
projects. hopes up too high as the earliest this could have
any effect is April 2014 and there could well be a
NRM 3- A new document which is intended for use hike in discrimination claims then as those
with regard to cost estimating and cost planning for claims do not require any minimum length of
building maintenance. This new document will be a service. Disgruntled dismissed employees,
great aid when QSs are involved in life cycle costing. unable to make an unfair dismissal claim could
well bring a claim based on discrimination on
NRM 1 and 2 are to be launched in late April of this
the grounds of race, sex, sexual orientation,
year with NRM 3 in the autumn. The RICS should be
congratulated for the production of the NRM suite pregnancy or maternity, marriage or civil
which should be of great benefit to all QSs. partnership, religion or belief, pregnancy or
maternity, age, disability or a whistle blowing
claim. These claims are by their very nature
more complex and therefore more expensive.

Latest Upgrades Nigel Finch, Director, HR Dept comments:

“Though headline grabbing, it is unlikely this will
Congratulations to the following members make a difference in average awards (£9,120).
who have recently upgraded their level of Employees who want their day in court will find
membership: alternative ways to make a claim, especially
To Fellow: To Member: since ‘tag on’ claims are becoming increasingly
John Carmichael Steven Westmoreland popular. It often is the SME business owner who
Gary Dacosta has to fork out more legal expense/cost to
Myles Gretton If you would like to upgrade defend against a claim whether vexatious or
Alan Hunton your membership please not”.
Stuart Livesey contact Suzanne Cash at The HR Dept specialises in advising small and
Trevor Mitchell [email protected] medium sized businesses on all employment
Charles Silvester issues.
Mark Wall
www.hrdept.co.uk

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QSi Spring 2012 - Page 07
Are you going to remain a student
all your life?
Climbing the QSi ladder.
The QSi was founded several years ago to represent
and support the Quantity Surveying profession
worldwide.

A small but loyal band of active QSi members is still

pursuing this objective.

Help us to help you by upgrading your membership. All

you have to do is fill in the form below, scan it and then
email the attachment back to
[email protected]
Looking forward to hearing from you.
Andrew Williams FQSi FRICS
President
I want to upgrade my QSi membership
Name ……………………………………..
QSi number ……………………………….
(If you can not locate your number we will
find it on our register)
email address ……………………………
Current grade …………………………..
I confirm that I am working as a Quantity
Surveyor
And I wish to apply for Associate / Member/ Fel-
low
I am interested in writing for the QS Eye magazine Y/N
I am interested in linking with the QSi website Y/N
I am interested in advertising my business on the
QSi Website (Special rates available to members) Y/N
I am interested in helping the QSi Nationally / Regionally Y/N
I am interested in benefiting from cheaper utilities and
would like more information Y/N

Signed ……………………………………..
Qualifications …………………………………..

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Page 08 - QSi Spring 2012
ADJUDICATION PROVISIONS OF NEC 3
In the last edition of QS Eye I discussed how the unwary could fall dispute to the Project Manager and the other Party.
foul of the notice requirements of the NEC 3 compensation event So how does Option W1 work in practice? Take for example the
provisions. situation where a compensation event has been issued by the
There are other provisions of the NEC 3 contract which the unwary Project Manager and the Contractor has issued a compensation
could fall foul of and the provision I wish to explore in this issue of event quotation in accordance with clause 61.4, which the Project
QS Eye is found in Option W1 of the Main Option Clauses of NEC 3. Manager has rejected by giving notice to the Contractor in
Most contracts in England and Wales will be governed by the accordance with clause 62.3 that he will make his own
adjudication provisions of the Housing Grants, Construction and assessment. If the Project Manager assesses changes to the
Regeneration Act 1996 (as amended by the Local Democracy Prices, as he is entitled to do by virtue of clause 63, and neither
Economic, Development and Construction Act 2009 (the “Act”). the Contractor nor the Employer are satisfied with his assessment
However, Main Option Clause W1 concerns dispute resolution they are both entitled to dispute it.
under a contract to which the adjudication provisions of the Act do The assessment is an action by the Project Manager. The
not apply. Adjudication Table requires the Contractor to give notice of a
Clause W1.1 states that a dispute arising under or in connection dispute to the Project Manager and to the Employer within 4
with the contract shall be referred to and decided by an weeks of the Project Manager’s action. The Contractor then has
adjudicator. Clause W1.2 identifies the procedure for appointing to refer the dispute to adjudication between 2 and 4 weeks of
an adjudicator. giving notice of the dispute. If the Contractor does not issue a
notice of dispute within 4 weeks of the Project Manager’s action
Clause W1.3(1) provides the first pitfall for the unwary. It states the Contractor is prevented from referring the dispute to
that disputes are notified and referred to the adjudicator in adjudication. Even if the Contractor has given a timely notice the
accordance with the Adjudication Table. The Adjudication Table Contractor will be prevented from referring the dispute to
identifies various types of dispute, who may refer the dispute to adjudication if it does not refer the dispute to adjudication
the adjudicator, and when the dispute has to be referred to the between 2 and 4 weeks of giving notice of the dispute.
adjudicator. It is the latter which is of concern.
By contrast the Adjudication Table does not require the Employer
The Adjudication Table states that a dispute concerning the action to give notice of a dispute within 4 weeks of an action of the
of the Project Manager or the Supervisor is to be referred to Project Manager. The matter falls within “any other matter” and so
adjudication by the Contractor between 2 and 4 weeks after the Employer can notify the Project Manager and the Contractor of
notification of the dispute to the Employer and the Project the dispute at any time. The only limitation on the Employer is that
Manager. The table also states that the notification to the Project when he does notify the dispute he must refer the matter to
Manager and the Employer must be made not more than 4 weeks adjudication between 2 and 4 weeks of giving notice. Failure to
after the Contractor becomes aware of the action taken by the refer the dispute between 2 and 4 weeks of giving notice will debar
Project Manager or the Supervisor, which has caused the dispute. the Employer from referring the dispute to adjudication.
Clause W1.3(2) states that the times for notifying and referring Assuming that the requirements of the Adjudication Table have
disputes to adjudication may be extended by agreement between been complied with and a dispute has been referred to
the Project Manager and the Contractor before the notification or adjudication and decided by an adjudicator all in accordance with
referral are due. However, the clause goes on to state “If a Option W1 there is yet another timing hurdle to overcome in the
disputed matter is not notified and referred within the times set out event that the adjudicator’s decision is to be challenged.
in this contract, neither Party may subsequently refer it to the
Adjudicator or the tribunal.” Clause W1.3(10) states that the Adjudicator’s decision is final and
binding on the Parties unless and until it is revised by the tribunal.
The tribunal is identified in clause W1.4. It provides that a dispute
shall not be referred to the tribunal unless it has first been referred As stated earlier, clause W1.4(1) states that a dispute may not be
to the adjudicator in accordance with the contract. So, as will be referred to the tribunal unless it has first been referred “to the
seen later, if a dispute cannot be referred to an adjudicator Adjudicator in accordance with this contract”. The tribunal is
because the timing provisions of the Adjudication Table have not defined in the Contract Data and may be arbitration or litigation (or
been complied with, the dispute cannot be referred to the tribunal. some other dispute resolution proceedings chosen by the parties).
The effect of clause W1.3(2) is that if the timing provisions of the Clause W1.4(2) provides that a Party may not refer a dispute to the
Adjudication Table are not complied with the party pursuing the tribunal unless a notice of intention to refer the dispute to the
dispute has no remedy. Put another way the effect of the clause is tribunal is given within 4 weeks of the adjudicator’s decision. The
that there is no dispute between the parties; the dispute has been clause is clear and will be enforced by the courts. Failure to give
resolved by default. notice of a dispute within 4 weeks of the adjudicator’s decision
The Adjudication Table includes similar timing provisions in means that the adjudicator’s decision is final.
consequence of the failure of the Project Manager or Supervisor to Like clause W1.3(2) the effect of clause W1.4(2) is that if the timing
take an action. The Contractor must notify the Employer and the provision of clause W1.4(1) is not complied with the party pursuing
Project Manager within 4 weeks of becoming aware of the action the dispute has no remedy. The effect of the clause is that there is
that was not taken by the Project Manager or the Supervisor and no dispute between the parties. The dispute has been resolved by
the Contractor must refer the matter to adjudication between 2 default.
and 4 weeks of giving notice of the dispute.
Once again the importance of complying with the notice provi-
It is not just the Contractor who could fall foul of the requirements sions of the NEC 3 contract cannot be over emphasised. Failure
of the Adjudication Table. If a quotation issued by the Contractor to comply with the notice provisions can leave an aggrieved party
is treated as being accepted by the Project Manager under clause very aggrieved indeed.
62.6 and the Employer wishes to dispute it, the Employer has to
give notice of a dispute to the Contractor and the Project Manager
within 4 weeks of the quotation being accepted and commence Mark Wright is joint editor of Construction Contract Claims, third
adjudication proceedings between 2 and 4 weeks of giving notice. edition, published by Palgrave MacMillan Press. Construction
The only type of dispute which is not subject to the same strict Contract Claims includes a worked example of a compensation
timing provisions is “any other matter”, which can be notified to event and the latest amendments to Part II of the Housing Grants,
the Project Manager and the other Party at any time. However, the Construction and Regeneration Act 1996. Mark can be contacted
Adjudication Table requires “any other matter” to be referred to via [email protected]
adjudication between 2 and 4 weeks after notification of the

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QSi Spring 2012 - Page 09
Building Information Modelling (BIM) and Its
Legal Implications commence a joint action against those who could be
liable. Having heard the evidence the court may decide to
From time to time a new invention or process results in a apportion the costs between the defendants to represent
revolution in the manner in which businesses operate. The their level of culpability. This is never an easy task for a
telephone, photocopying and computers immediately judge to perform and often results in the apportionment
spring to mind. Some inventions and new processes only being arbitrary. Alternatively the client may decide to
affect certain types of business; Computer Aided Design, commence an action against the most likely candidate. If
CAD drastically affected the efficiency of businesses such this occurs the defendant so selected may apply to the
as Architects and Engineers which communicate court to join in the other possible miscreants as co-
information by means of drawings, being a good example. defendants. If the defendant decides to fight on alone and
BIM, which is likely to change the manner in which the loses, it is open to him to attempt the recovery of
construction industry operates, has been around for a few contributions from others who may have been responsible
years, but it is only in the past twelve months or so that the for the problem.
media has recognised its potential and given it due
publicity. One of the difficulties with legal actions for the recovery of
financial loss is that they normally proceed at a snail’s
There will be many involved in the construction industry pace and are accompanied by huge legal costs which
who either haven’t heard of BIM, or if they have, are not often run into millions of pounds. If the award is not in the
aware of its function and potential. In view of an an- tens of millions, the legal costs often exceed the amount of
nouncement in May 2011, by the government, that BIM is a reasonable award. Where alleged design fault is involved
to be phased in on all government construction projects the defendants usually have the comfort of Professional
between 2012 and 2016; those in this sector who rely on Indemnity Insurance to protect them; in which case
public sector work to assist in turning a profit need to look Insurance companies become involved at an early stage.
lively and get on board with BIM. From long experience they are fully aware of the legal cost
implications and usually when the time is right settle the
So what is BIM? It has been described as a three dispute. The first reported legal case occurred in the USA
dimension modelling tool that encompasses spatial and involved an Architect and Mechanical and Electrical
relationships, geographic information and quantities and Engineer who employed BIM to fit MEP systems in the
attributes of building components. Architects, Engineers, ceilings plenum at a university life sciences building. The
Contractors and Subcontractors involved in design where design team failed to advise the Contractor that due to the
BIM is employed will all be using the same data and tight fit, a very specific installation sequence was required.
inputting it to produce drawings which are consistent. BIM When the assembly was about 70% complete they ran out
tools allow for extracting different views from a building of space. The Contractor sued the owner, who sued the
model which are three dimensional. The process Architect who brought the Engineer into the action. The
eliminates many of the errors which plague the industry dispute was settled by the PI insurers paying out many
and the many clashes of services which often carry a high millions of dollars. A lack of proper communication
cost to eliminate. It is claimed that rapid cost analysis is a appeared to be the root cause of the problem!
feature of BIM which will be attractive to tendering
contractors and subcontractors. Planning from start to Roger Knowles FRICS FCIArb FQSi Barrister
finish of the project should be improved by the use of BIM, Independent Consultant
as should cost management. Ordering of materials should
be more accurate and thus help eliminate waste. Achieve QSi Membership
Completion to time and on budget should be more readily
NB - These approved courses will also provide
achieved using BIM than the more traditional methods.
membership of the CIOB
QSi Approved Learning Provider WMR Ltd
With Architect, Engineer, Contractor and some of the offers the following routes to membership
Subcontractors inputting into the design model ,who is EXPERIENCED PRACTITIONER ASSESSED (EPA)
responsible if errors arise and the client is put to 8 x 1 day weekend workshops over 9 months
considerable expense in overcoming the problem? Where SENIOR MANAGEMENT ROUTE
BIM is employed it could, in many cases, be almost 1 to 1 mentoring for EPAR report completion & interview
impossible to identify who was responsible for the costly PROFESSIONAL REVIEW/INTERVIEW
error. Where does this leave the client who has spent a 1 day Workshop - Degree or EPA Part B holders-
great deal of money correcting the error, if there is no includes review & feedback on your draft package
obvious miscreant? With no smoking gun what options, if DISTANCE LEARNING OPTIONS: UK & Overseas
any, are open to the client. For the client to take an Contact: Chris Westacott FCIOB MQSi CEnv
educated stab in the dark as to who caused the problem Westacott Management Resources Ltd
could prove costly with no guarantee of success. The law Tel: 01233 503691 Email: [email protected]
relating to joint and several liability may come to the aid of
the employer which allows a disappointed client to

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Page 10 - QSi Spring 2012
Architectural
Photography
Re-Defined
What does an architectural photographer
actually do? The obvious answer is they
photograph buildings, although I’ve worked
as an Architectural Photographer for several
decades and I’ve found the job to be both
more complex and on the whole much more
interesting than this implies. Most people
are interested in photographs of their own
buildings, or buildings they are thinking of
acquiring; however if the offerings of most Hand printed photgraph of Leeds Market Roof Stucture c 1969
estate agents are anything to go by, the general public is
designed houses and offices. Interiors are notoriously
likely to have a very low opinion of buildings as the subject
difficult to photograph and this in particular is an area
matter for photography. Everybody will have their holiday
where the skills of the professional can really be telling.
photos with iconic structures, Buckingham Palace, the
Not only can indoor lighting be a problem for the
Eiffel tower, the Taj Mahal, but people and animals are the
inexperienced photographer, but the wide angle lenses
most popular subjects, not many outside the construction
which are needed to photograph the room as a whole,
industry are very interested in pictures of the buildings
rather than just a series of corners, cause considerable
around them.
distortion which is both disconcerting and potentially
Historically the work of the architectural photographer was misleading. Estate agents take note.
to document buildings which were regarded as important.
My first big job as an architectural photographer was in
Their clients were the great and the wealthy who wanted
Milton Keynes, where the palatial shopping building in
their new city hall, mansion or factory recorded in all its
the city centre had just been completed and the units
glory. Guillermo Kahlo, whose work I saw in an exhibition
were filling with shops. I had the task of recording each
in Chichester, was paid to photograph the ‘cultural
let unit, both indoors and on the periphery of the
patrimony’ of Mexico before the 1910 revolution. His sepia
building, once they were up and running. While some
pictures of self-important government buildings were as
may say this is documentary not architectural
dull as officially sanctioned photographs are, far too often.
photography, I would argue that the same skills are
Senor Kahlo’s work was only exhibited as complimentary
required. Photographing plate glass windows and
to the main exhibition, which showed the paintings of his
stainless steel framed shop-fronts presents the same
daughter Frida Kahlo. It is improbable that an exhibition
problems as photographing a glass clad, multi-million
dedicated to this dated style of photography could be a
pound office building; reflective surfaces are
major attraction.
notoriously tricky to photograph.
The process of creating the large, high-quality architectural
prints which many clients require was labour intensive
even into the 1990’s. It needed very bulky camera
equipment, even a good hand- held camera was not
regarded as up to the job and large plate cameras on
tripods were still used, producing huge negatives each
one five by four or even ten by eight inches. These could
record very high quality images which then needed
hand-printing, involving hours in a darkroom. Digital
photography has ended all that, today almost anyone
might take reasonable shots of buildings, manipulate them
using a package such as Photoshop and print them to
whatever size they like.
Google the term ‘architectural photographer’ and you will
Photographing reflective surfaces.
find a number of websites featuring great photographs of Sculpture by Wendy Taylor at Norfolk House, Milton
both exteriors and interiors of beautiful, architect Keynes C1986

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QSi Spring 2012 - Page 11
My career has been mainly within the building industry accurate photographs, some jobs need hundreds.
and involves a great deal of ‘documentary’ photography,
much of it working with construction professionals who Thus far I have never actually been asked to make a
need photographic records of the condition of buildings building look important, though I’m quite ready to do
or parts of buildings. Accuracy is the key. For example, so should the need arise. Accuracy has been the most
twenty years ago a factory unit on the Wirral had important requirement of each job, there is no room for
problems with the metal panels which clad the building. guesswork or digital manipulation when what is needed
My job was to individually photograph and record the is a completely reliable record. The photograph must
exact location of every single panel, whether defective or be accurate when the shutter is released. Such
not, as well as record every defect in close-up. photographs are not just record keeping exercises;
Photographic prints had to be clear and detailed and the they are often used in dispute resolutions and even
job required very accurate record keeping as well as the litigation so, whether I’m photographing the recladding
photography. Digital technology makes this highly of apartment blocks on the Mediterranean or a
tedious aspect of such tasks much easier, though these decaying concrete bridge in Yorkshire, the client wants
pictures can’t be taken with a mobile phone, however to see exactly and often in minute detail what is there,
many apps it contains! The images need to be very down to the last hairline crack and drip of
detailed and accurate in the first place, which is where condensation. They aren’t necessarily concerned with
the skill of the professional comes in. how pretty it can be made to look.
The easiest job I’ve ever done is one I don’t remember,
because easy is far less interesting, but the trickiest was
photographing the progress of major refurbishment
works which took place in Weston Favell shopping
centre in Bedfordshire. The weather was atrocious, so
my exterior shots were gloomy and I didn’t dare to climb
to vantage points to find better camera angles. Indoors,
the air was full of dust and the builder’s floodlights
combined with ceiling strip-lights to create a dingy
yellow colour-cast over everything. I was also required to
photograph into deep, shadowy areas where my flash
was totally ineffectual, making accurate recording of
anything almost impossible.
Clients are not always just concerned with looks…
When I did my photographic training, most fellow
students were obsessed with the latest equipment,
whereas I’ve always regarded cameras as mere tools of
the trade. It is the images I’m interested in and so are my
clients. Much better a reliable, high-quality tool which I’m
totally familiar with and can use instinctively than the
latest gizmo that I don’t have time to figure out once
reaching site, to my clients’ disadvantage. However I’ve
moved with the times; I’ve used the Canon EOS range
before and since their introduction of digital cameras and
I haven’t touched a rising-front camera, the type I was
Recording in minute detail – ageing in reinforced originally taught was the only possible tool for
concrete. photographing buildings, since I left college. The
versatility and accuracy of a good quality digital SLR
The architectural photographer’s job always involves makes it the choice of most professional photographers
some travelling. Mine has taken me to important and the architectural photographer is no exception.
Georgian buildings in Edinburgh, sheltered housing in So the job of this architectural photographer is not
Morcambe, the roof of a major Manchester hospital, always what historical precedent might suggest.
seaside homes in Torquay, millionaire’s homes in Guillermo Kahlo was a good photographer and produced
Jersey and as far afield as Gibraltar and Warsaw. The the images his client required. I do the same, but these
most tedious task was photographing crumbling days clients’ requirements are somewhat different.
boundary walls around a Liverpool housing estate, Impressive or romantic images are not always needed,
when there are so many better things to do in that while accuracy and detail are essential and with the aid
fascinating city! The most interesting job, so far, was of new technology, today’s architectural photographer
spending hours, mainly on the roofs, recording the can provide this service with confidence and success.
extent and complexity of the construction work for the
Crowngate development in the historic centre of Susan Gilbert, Director and Architectural
Worcester. Every one of these jobs required many Photographer with ArchiFACT Limited.

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Page 12 - QSi Spring 2012
Claims Class - Case Studies
In Claims Class - Case Studies, we present a case study of details, which include the construction details of the
a real situation for the reader to study and decide on the driveways and footpaths and contain references to the
correct contractual outcome. The author’s opinion of the specification for materials and workmanship.
solution is presented elsewhere in the magazine.
9) The Preambles to the Bill of Quantities contains the
The following describes the situation for this edition’s case following clause:
study.
‘4.3 The Contractor is reminded that this Contract is a
1) The project consists of 30 executive houses together Lump Sum Price. The quantities inserted in the Bills of
with roads and infrastructure. There are five different types Quantities are indicative only and the Contractor is
of dwelling, referred to as Types A, B, C, D and E and six of required to check and verify each prior to submission
each house type are included at various locations within the of his tender. Quantities shall be deemed to be entirely
project. The plots of each house type are identical in size at the Contractor’s risk and no adjustment or variation
and layout. The Works include driveways, and two-vehicle in price will be allowed due to error or omission in the
carports which are attached to the house. quantities, or error in the computation of the tender,
2) The order of priority of the contract documents is as discovered after submission of the tender.’
follows: 10) Bills of Quantities are provided for each house
a) The Contract type. The bills of quantities for each individual house
b) The specification type include an item for block paving and driveways
c) The drawings and the quantities correspond to the areas shown on
d) The bill of quantities the house type drawings.
e) Any other documents It is a reasonable assumption that the designer has
simply omitted the herringbone pattern and the block
3) The contract contains the following provision in relation paving annotation from the house Type B drawings, but
to the contracts documents: ‘The above order of priority is what is the contractual outcome from this error? Refer
to be followed in the event of conflicting requirements as to page 14 for the author’s opinion.
between the foregoing documents. If an item is required by
any document it should have precedence over a document
not requiring it.’
4) The contract price is defined in the conditions of
contract as follows:
(a) The Contract Price shall be the lump sum price
inserted in the Appendix to Tender and be subject to
adjustments in accordance with the Contract;
(b) the items and quantities given in the Bill of
Quantities or any Schedules are indicative only and
shall not be considered as accurately representing the
In-House
work to be executed by the Contractor in performing
the Works. The quantities will not be re-measured and
the lump sum Contract Price shall be deemed to cover
Training
for the whole of the Works as shown on the Drawings,
described in the Specification or otherwise required by
Hart Construction Training offers comprehensive
the Contract and whether or not included in the Bill of training on all aspects of construction contract
Quantities or any Schedules..’ law. Our topics include, but are not limited to:
5) The Specification contains a generic specification for I Contractual Awareness I Partnering and Partnering Contracts
I Contract Administration I Open Book Accounting
block paving, which consists of 100 mm thick concrete I Contractual Problems I NEC3
I Delays, Extensions of Time and I CDM Regulations
block paving, laid to a herringbone pattern, on a 50 mm Liquidated Damages I Private Finance Initiative
sand bed, on a 100 mm bed of compacted stone. The I Design and Construct Contracts I Measurement
I JCT05 I Taxation
Specification includes descriptions of the materials and I JCT Constructing Excellence – I The New Construction Contracts Bill
workmanship and does not include any information as to the New Partnering Contract I Maximising Cash Collection During
A Recession
where the block paving is to be located. Our course leaders are all experienced lecturers, working within the industry for many years.

6) The drawings for house Types A, C D and E show a Our in-house courses can be tailored to suit your specific requirements and held at a time and location to
suit your staff.
herringbone pattern to the area beneath the carport and the For further information please call on: 01606 786698, email: [email protected],
or complete the form below and return to: Hart Construction Training Ltd, 61 School Lane, Hartford,
driveway leading from the carport to the road. The drawings Northwich CW8 1NY.

contain the following annotation to the herringbone Please contact me to discuss my training requirements:

patterned areas ‘Block paving as specified’. NAME: ........................................................................................... POSITION: ............................................................................................

7) The house type drawings for Type B show only an ORGANISATION: ....................................................................................................................................................................................................

outline of the area beneath the carport and driveway and ADDRESS: ......................................................................................................................................................................................................................

there is no note relating to block paving as shown on the ......................................................................................................................................... POSTCODE: ............................................................

drawings for the other house types. TEL: ........................................................................................... EMAIL: .............................................................................................................

61 School Lane, Hartford, Northwich CW8 1NY Tel: 01606 786698 Email: [email protected]
Company registered in England and Wales. Registered number: 05681875

8) The drawings also contain typical external works

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QSi Spring 2012 - Page 13
 Claims Class Case Studies –
documents, that any document requiring an item should

Author’s Opinion have precedence over something not requiring it. Looking
at the situation from this angle it seems that the bills of
quantities which include block paving to house Type B, has
The contract is a lump precedence over the drawings and that therefore, the
sum price for ‘the whole of paving should be included in the contract. The following
the Works as shown on arguments may however be brought against such a stance.
the Drawings, described in The contractor is not the designer and he therefore has no
the Specification or responsibility other than to construct what is shown.
otherwise required by the Consequently, if the employer wishes to have something, it
Contract’. needs to be included in the design.
Both the conditions of
Both the conditions of contract and the preambles to the
contract and the
bill of quantities provide that the bills of quantities are to be
preambles to the bill of
regarded as indicative and not to accurately represent the
quantities provide that the
work. If the contract specifically makes this point, then how
bills of quantities are to be
can a document described as indicative and not accurate
regarded as indicative and
take precedence over the design drawing?
not to accurately represent
the work. Hence, if they The principle of contra proferentem may also be taken into
do not include for something that is included in the account here. Osborn’s Concise Law Dictionary offers the
specification and/or drawings, no adjustment shall be made following definition of contra proferentem: ‘The doctrine that
to the contract price. Similarly therefore, if they do include for the construction least favourable to the person putting
something that is not included in the specification and forwards an instrument should be adopted against him’,
drawings, which is the case here, then again, no adjustment where “instrument” is defined as ‘A formal legal document
to the contract price may be made. In this case, the block in writing’. Simply put, this means that the drafter of the
paving to house Type B is not shown on the drawings and document had every chance produce a clear and
so, is not included in the contract. unambiguous document and if any mistakes, ambiguities
The Specification includes only a description of the or conflicts exist in the document, they must be interpreted
materials and workmanship and does not include any in the favour of the other party.
requirements with reference to the location of the block Taking all the above into consideration it is my opinion that
paving. Consequently, the block paving to house Type B any requirement to provide block paving to house Type B
cannot be construed as being required by the Specification. would constitute a variation to the contract.
This may be a design error and it may be obvious that block
paving would be required to house Type B, but the paving is Andy Hewitt
not included in the specification and/or drawings and Hewitt Construction Consultancy
therefore, any instruction to provide the paving would thus www.contructionclaimsclass.com
far constitute a variation.
The employer has tried to protect himself against such
situations by including the provision under the precedence of

We can offer you decades of expertise in the

prevention, analysis and resolution of building
disputes and defects, including technical reports,
litigation support, forensic analysis and expert
evidence.
Contact us today.

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Page 14 - QSi Spring 2012
 SWEETT (UK) LTD. (FORMERLY CYRIL SWEETT
LTD. V MICHAEL WIGHT HOMES LTD.; 23 FEBRUARY 2012
CLAIM NO. 8XJ30307
EXETER COUNTY COURT

Keywords: Extent of Quantity Surveyors Duty to “Arrange”

Performance Bond

Sweett acted as quantity surveyor and employer’s agent for Michael Wight Homes (MWH) on a site in Somerset.
MWH had been established specifically to develop the site, and entered into a JCT 2005 Design and Build Contract
with Diamond for the project. Diamond went into liquidation in June 2009 and MWH terminated its contract. The
contractor took no part in the present litigation.

Under the contract, Diamond was required to provide a performance bond of 10% of the contract sum. The contract
documentation included a draft of the bond which Sweett had prepared. It was accepted that the terms of the bond
were incorporated into the contract between Diamond and MWH.

Sweett terminated their engagement in September 2008 because their fees had not been paid. Following an
exchange of e-mails on 4 February 2008, it had been an express term of their engagement that Sweett would
‘prepare contract documentation and arrange for such documents to be executed by the parties thereto’.

The issues between the parties concerned Sweett’s entitlement to fees, and its duties to MWH, particularly in
relation to the provision of the performance bond. MWH argued that Sweett had been in breach of its duty to ensure
that Diamond provided the bond. MWH said that one of Sweett’s duties had been to prepare the works contract and
associated documentation and that this included a duty to ensure that Diamond provided the required performance
bond which Sweett had drafted. Alternatively, MWH said that if the requirement to arrange a performance bond to
be executed were not an absolute obligation, there was an implied term that Sweett would use reasonable skill and
care to arrange for a performance bond to be executed, and Sweett was in breach of contract. MWH also alleged
that Sweett had been under a duty to advise MWH about the risk of Diamond commencing work without the
performance bond being in place.

In its defence, Sweett argued that, as employer’s agent and quantity surveyor, its contractual obligations had been
solely to review and identify the risks between the parties to the contract i.e. MWH and Diamond. It had not been
responsible for identifying other risks and consequences. Sweett alleged that it had advised MWH on several
occasions that it should have a performance bond in place. Sweett admitted that there was an implied term that it
would exercise its duties with reasonable skill and care, but submitted that MWH had failed to particularise the basis
upon which a tortious duty of care had been owed. Sweett said that the tortious duty of care mirrored the
contractual duty. Sweett denied that it had any duty to ensure that Diamond had provided a performance bond.
Sweett provided evidence that it had chased both MWH and Diamond for updates on the provision of the bond.

Part of Sweett’s ‘schedule of duties - employer’s agent, quantity surveying and CDM co-coordinator services’
stated:

“Prepare contract documentation and arrange for such documents to be executed by the parties thereto.”

ABSOLUTE DUTY

Sweett suggested that a duty arises either as an absolute duty or as the default duty which requires the taking and
exercise of reasonable care, but the court rejected this. Where there is an agreement between parties the
agreement has to be construed in order to determine the nature of the obligations between the parties. The
agreement could not be ignored. In the judge’s view, the wording of the engagement did not impose an absolute
duty on Sweett to ensure that Diamond entered into a performance bond. The words used could be construed as
imposing an obligation on Sweett to ensure that Diamond executed the bond. Those were not the words that were
used. The word ‘arrange’ did not have the same meaning as ‘ensure’.

The judge considered the meaning of the word “arrange”, finding that the dictionary definitions did not mean that
Sweett had an absolute duty to ensure that Diamond signed the bond. It meant that it had a duty to put into proper
order the execution by Diamond of the bond, which was what Sweett had done. Sweett had drafted the bond,
ensured that it was a contractual term of the agreement between the MWH and Diamond that the bond would be
signed, had advised the MWH of the importance and meaning of the bond, put pressure on the contractor, both in
writing and in meetings, to sign it and informed MWH of the steps that had been taken. Sweett had put in place

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QSi Spring 2012 - Page 15
 arrangements for the bond to be executed by the parties and had put into proper order the execution of the bond.

THE EXTENT OF SWEETT’S DUTY

By 7 May 2008, MWH’s Mr. Wight had been anxious for the work to progress, and he was being put under pressure by
the project funders to complete the documentation which did not include the bond. Diamond had already been on site
for 43 days. Mr. Wight had known about the importance of the bond, having been repeatedly reminded by Sweett. A
draft bond had been sent to Diamond which had been chased to sign and return it. The contract had been signed on
23 May 2008, and it was accepted that the wording of the draft bond was expressly incorporated into it. Sweett’s Mr.
Clough, who had drafted the bond, said that, since the contract stated that the bond was to be provided and
incorporated into the contract, it should be assumed that Diamond was happy with the proposed wording of the bond.
The judge accepted this. Mr. Clough also said, rightly in the judge’s opinion, that he did not need the name of the
surety that would provide the bond, since that was for Diamond to sort out.

Sweett had not advised MWH to delay signing the contract until the bond was in place, possibly, Mr. Clough had
testified, because the work was already under way. Any suggestion that there was a breach of duty in this regard was
directly counter to the evidence of the experts.

MWH had been well informed about the bond and Diamond’s inaction. It had been aware of what Mr. Clough was
doing and was not pressing for more action from him. Diamond was saying that it was chasing up the bond, work was
progressing well, but Diamond was being paid less than was being certified. In the circumstances, the judge
considered that a reasonably competent quantity surveyor and employer’s agent would have done what Sweett had.

On 18 August 2008, Diamond had contacted MWH to say that unless they received a payment, there would be
problems in them continuing on site. At this stage, both MWH and Sweett had thought that a performance bond was in
place. Mr. Clough had been told that the bond had been signed. However, in fact, Diamond had refused to pay the
£4,500 required to obtain the bond. MWH suggested that Sweett should have put pressure on Diamond by, for
example, withholding payments or proposing that the bond should be a lower percentage of the contract value.

The judge took into account the expert evidence in finding that Sweett had not been in breach of its duty. He preferred
the evidence of Sweett’s expert Mr. Haywood, whose evidence he found to be logical and careful. He said that he
would have done exactly what Mr. Clough had done i.e. try to persuade Diamond to take out of the bond. If they then
failed to do so, the withholding of money might be used. However, in 9 times out 10 the withholding of money was not
necessary as the threat was enough. However, the position was made more complicated by the fact that Diamond was
alleging that MWH had underpaid them. In those circumstances, would an employer threaten to withhold money when
the contractor was already alleging serious underpayment by the employer? Mr. Haywood thought that withholding the
whole of the amount of the bond (£93,300) might be outside the powers of the employer’s agent. He had said that it is
quite rare for an employer’s agent to withhold payments.

Copyright: BLISS, the Building Law Information

Subscriber Service 2012
Andrew R Williams
& Associates
This summary has been selected from the current weekly First Floor H.S.L. Buildings
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construction case law alert. Please contact us for Web: www.andrewrwilliams.co.uk
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Mob: 07940 875076

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Page 16 - QSi Spring 2012
 2. University of Wolverhampton provides

Press Release professionally accredited courses throughout the

region in Construction and the Built Environment
disciplines by the Chartered Institute of Building,

For immediate release the Royal Institution of Chartered Surveyors, the

Institution of Civil Engineers and the Chartered
Quantity Surveyors International Institute of Architectural Technologists.
61 School Lane, Hartford, Northwich CW8 1NY
3. The University as well as delivering programmes
University of Wolverhampton overseas also has a large overseas student
School of Technology, Department of Built population in the UK. Anyone interested in courses
Environment. Wulfruna Street, Wolverhampton WV1 1SB should contact the University directly on
For more details contact Mr Paul Hampton on 01902 323232
01902 322256
Wolverhampton: 22nd March 2012
A Vision for the Future - QSi West Midlands
Mr Steve Newcombe (Chair) and Glynis Hampton
(Vice-Chair of QSi West Midlands) and representatives from
the University of Wolverhampton were delighted to
welcome new committee members to the West Midlands
Board of Quantity Surveyors International (QSi).
Hosted at the University, new members some of whom
undertook their professional studies and Industrial
Placement at the University were invited to share their vision
for the future, and identified new ways of making more
direct interface with QSi members.
One of the newly appointed committee members Mr Jason
Coffey said
From left to right (Front row) - Peter Bryant,
"I am delighted in becoming a committee member of the Glynis Hampton (Vice Chair), Steve Newcombe
West Midlands Branch. I look forward to promoting the QSi (Chair), Robert Francis, Jakub Kubica, (back row),
to my fellow Quantity Surveyors and hope to see many of Jason Coffey, Scott Adshead, Jason Stanley
them at this year’s conference"
QSi has historically held a presence within the West
Midlands, but the “vision for the future” will look to build a
Dear Sir
more sustainable platform moving forward. QSi was also
I read with concern the report which appeared in
delighted to announce that this year’s annual conference Building 10 February to the effect that David Pritchard,
will be held at the University of Wolverhampton on executive director of the Major Projects Authority, has
Wednesday 7th November. For further details please visit indicated that in future, consultancy companies will
our website at www.theqsi.com/seminars.asp or email receive less work. His intention is to appoint civil
[email protected] servants to the lead role in the construction process in
place of external consultants. The plan is to train civil
Notes servants with little or no previous experience to lead
1. The Quantity Surveyors International (QSi) provides: major projects efficiently. An arrangement has been
entered into whereby the civil servants will be trained at
• Major Annual QS Conference Oxford University’s Said Business School. Many of the
• Branch Network, supporting local members through external consultants to be replaced will have
networking and training events appropriate degrees and many years of experience at
• Regular News Update – weekly bulletin of construction leading the construction process as Project Managers,
news (individual subscriptions would cost £1,495 but it Architects or Engineers. To consider that all this
is free to all QSi members) expertise can be replaced by civil servants who have
been theoretically trained in a limited period of time,
• 100 Legal Cases available online
displays naivety in the extreme. The waste leading to
• CPD modules available online enormous additional costs in projects undertaken by the
• Reduced insurance costs through out links with Ministry of Defence illustrates what happens when there
Howdens is a lack of proper expertise at the top. When this
• Quarterly magazine change comes into effect, major contractors in the
• Advertising opportunities construction industry may follow the lead of the
• Reduced rates for CapIT – the world’s first defence industry contractors, and look forward to some
online carbon and cost estimator easy pickings.
10% reduction on fees with Ask an Expert
Roger Knowles
Independent Consultant
Anyone interested in becoming a member of QSi should Email roger @rogerknowles.com
contact Suzanne at [email protected]

To join the QSi please visit our website www.theqsi.com

QSi Spring 2012 - Page 17
Special Offer to QSi Members
200 Contractual Problems and their
Solutions, 3rd edition - Roger Knowles.
This book examines 200 contractual problems which regularly arise on building and engineering
projects and provides a detailed explanation of their solutions, citing standard contract conditions
and key parts of legal judgements as authority. A succinct summary is provided at the end of each
detailed solution. The book deals with a broad range of construction contracts including JCT
Standard Form and Design and Build, New Engineering Contract NEC3, ICE and GC/Works/1.
Special Offer Price £62.00. Please call BLISS Books on 01565 777234 quoting reference qsi200
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VISIT THE CONTRACT SHOP AT BLISSBOOKS.CO.UK
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Telephone: 01942 716755 (Direct)
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Prompt Online Contractual and Claims Advice

• Do you have a contractual problem?

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• Would you like an interpretation of the
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• Do you think you have entitlement for a claim?
• Have you received a claim and are unsure of its
merits or how to proceed?
• Do you need to compose or respond to a Discount on all fees for
contractual letter?
• Would you like a claim which you have prepared QSi members
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To join the QSi please visit our website www.theqsi.com

Page 18 - QSi Spring 2012
Stopping heat going up the flue. -
Passive Flue Gas Heat Recovery Devices. (PFGHRD)
Over the last few years energy prices had been rising inexorably.
Every new international crisis and increasing demand from countries
like China push fuel prices even higher. And Finally some comic
Even if the new Irish oil discoveries provide additional supply and
new finds are discovered in UK waters (following the budget) and
pics from around the
Cuadrilla are successful in extracting shale gas near Blackpool,
(without allegedly causing earthquakes) it seemed reasonable to world
assume that fuel prices will still just keep on rising. The best we can
hope for is if we have a larger domestic supply it will slow the price
rises down a bit.

One way of reducing costs (and carbon emissions) is by installing

new condensing boilers. However, even these let a significant
amount of energy escape. In order to extract even more heat, some
condensing boilers (both gas and oil) are now being fitted with
Passive Flue Gas Heat Recovery Devices. (PFGHRD)

These devices are a boiler flue attachment that recover heat from
the waste combustion gases and then use it to pre-heat the
domestic hot water supply. In other words, this device extracts even
more heat out of the flue gases. It works by saving heat that would
normally be lost into the air.

An added bonus is that PFGHRDs do not require any more electric

power or gas to operate and having pre-warmed water to work with;
the boiler can deliver water faster to the tap. The device also
reduces water loss because there is less need to run off lukewarm
water while waiting for the hot supply to arrive.

As the EU and the UK are looking for more ways to save energy, it
won’t be long before all new homes are fitted with these devices.

Andrew Williams
Andrew R Williams & Associates
St Helens 01744 644 042
Liverpool 0150 426 9660
Warrington 01925 670 447
[email protected]

ROGER KNOWLES
Independent Consultant
• Procurement • Dispute Resolution • Training
Knowledge and Experience Second to None
Contact
Roger Knowles Administration
Bracken House Suzanne Cash
Moss Lane 61 School Lane
Mere Hartford
Cheshire Northwich
WA16 OTA CW8 1NY
Email: [email protected] Email: [email protected]
Tel: 07712 134999 Tel: 01606 786698

To join the QSi please visit our website www.theqsi.com

QSi Spring 2012 - Page 19