1984 revisited

I wrote my first column for Building Magazine in 1984 and this is my last. Even if it makes me sound pre-historic and pompous, it is irresistible to look back and reflect. There is no-one at Building’s offices or here at Macfarlanes offices who was around in 1984 so I have posed my own questions – and answered them as well.

Have the industry’s procurement routes changed?

In 1984 the bulk of contracts were traditional but clients were experimenting with management contracting and construction management. From the hay day of management routes in the 1980s/1990s, we are back where we started - traditional or design and build.

Are forms of contract simpler and more comprehensible?

JCT Standard Building Contract and Design and Build Contract are both still over a 100 pages. But they do now include forms of bond, third party rights and sectional completion requirements. Some of the drafting is less opaque – “moiety” has become “half”, “PC Sums” and “nominated subcontractors” have disappeared; and new provisions have been added in relation to CDM Regulations, adjudication, payless notices and so on. But it is still all pretty dense – we all think we know exactly what JCT forms say but get tripped up constantly when we look at the details. The exception to this, of course, is JCT Major Project Construction Contract 2011 which you can actually read and understand.

The NEC suite is beguilingly simple to read but devastatingly difficult to manage. Those of us who were around in 1984 probably prefer the ICC conditions

And what about engineering forms?

The old ICE conditions have disappeared; NEC suite has replaced them. And now we have the ICC conditions. The NEC suite is beguilingly simple to read but devastatingly difficult to manage. Those of us who were around in 1984 probably prefer the ICC conditions.

And is the allocation of design responsibility any different?

In 1984 we still operated under the pretence that the architect (with an engineer) designed the building. The Contractor’s Designed Portion Supplemental recognised the possibility of subcontractors’ design but by exception and only when specified. Since 1984, specialist subcontractors’ design elements have expanded and proprietary systems increased. Buildings have got more technical and the architect assembles a kit of specialist parts. The standard form still treats CDP elements as the exception, although at least the standard form now includes proper design approval procedures, copyright licences and design warranties – even if always amended. And maybe this is why design and build has eclipsed traditional procurement on most big projects.

What about tendering?

In 1984 most projects were subject to competitive tender usually based on a bill of quantities devised under the arcane principles of the standard methods of measurement. Quantity surveyors were a key part of any team. Now – perhaps because so much of the project is carried out by specialist subcontractors – bills are a rarity. Indeed in buoyant construction markets such as the present one, tendering is a rarity. We keep up the pretence of competition by adopting two-stage tender processes but the choice is based on the people provided and the price is then negotiated.

In buoyant construction markets such as the present one, tendering is a rarity. We keep up the pretence of competition by adopting two-stage tender processes

Has the emphasis on supply chains and partnering improved the industry?

Yes and no. Genuine integration still seems to be the exception and the sort of unfair relationships experienced by Tesco’s suppliers a few years ago will be recognised by large parts of the construction industry supply chain today.

Have we engendered the “right spirit” within the industry?

I spotted a quote from Peter Rogers in the Latham Report which suggested we would only be doing this by “being more cohesive and better educated”. Call me a cynic but I am not sure we have quite got there.

And what about resolving disputes?

Most construction lawyers in 1984 were litigators and arbitrations absorbed years of their lives. Most construction lawyers now are still litigators and adjudications destroy their social lives but only for a few weeks at a time. Is this better? It is certainly quicker and cheaper but the result is more unpredictable.

Some of you will disagree with almost everything I have said and most of you will disagree with something – but you are not qualified to do so unless you were around in the construction industry in 1984…

Ann Minogue retired from her position as a partner in Macfarlanes last month. Building’s editorial team would like to wish her well in her retirement