Draft Construction Bill: I’m amphibious about it

The tadpole has arrived. It has no arms and no legs but it does have a name. It’s the Draft Construction Contracts Bill and if it is passed in law it will replace the adjudication and payment law in the Housing Grants Construction and Regeneration Act 1996. Parliament will probably turn the taddie into a frog.

Now then, it’s four years since Gordon Brown announced a review of what you and I call the Construction Act. Four bloomin’ years! And now that I have the draft bill on my desk I want to shout, “Hurrah! At last! Well done!”

But I’m in that mud again. Well, actually I’m out of my depth in it because this is the world of the parliamentary draftsman. Parliamentary draftsmen and me and plasters don’t mix. And yet and yet … these drafting folk are drafting rules for my plasters. Hear this: the construction industry will be utterly fogged by the language in the proposed rules, which will govern their waking and sleeping hours. Even if what is said is oh so sound, it’s mud.

So what are the proposed revisions? Do you recall that the act requires a contract to be “in writing” before it qualifies for adjudication and payment rules? How much money has been wasted conducting an adjudication only to find that the court would not enforce it because of a technical knock out? We call that the section 107 rule. No mud here in the bill. Section 107 is repealed.

Hear this: the industry will be utterly fogged by the language in the proposed rules, which will govern their waking and sleeping hours. Even if what is said is oh so sound, it’s mud

But slotted back in to the bill is a new command. Seemingly, the contract must provide “in writing” the right to adjudicate and “in writing” the effect of the adjudicator’s decision and if not then the Scheme for Construction Contracts applies. Then the new payment rules demand that the duty to give notices be “in writing” in the contract … and if not, the scheme applies.

Credit: Simone Lia

Do you sniff a great big waste of words here? It would be so easy to make the act an implied term that is automatically imported into the contract. Why not simply say (1) the following type of works are construction contracts, and (2) all such contracts shall enable a party to adjudicate and (3) all construction contracts shall require payments to be made in the following way.

Banned in the new act will be the idea that whoever brings the adjudication has to pay all the costs. That idea got the thumbs down from a lot of folk. So it goes out. Mind you, it could be spelled out more simply. There is an entire awkward page on it … more mud.

Banned also is the idea that there can be a clause in the contract making an interim payment decision binding if it is made by an outsider to the contract – say an architect or PQS or engineer. In other words, it’s not on to shut out the review of a payment certificate.

Going out, hurrah, is the old payment and withholding notices system. Instead we have another mistake …

And now we get more deeply in the mud with the proposed payment rules. Going out, hurrah, is the old payment and withholding notices system. It was painful. Instead we have another mistake. The parliamentary draftsmen insist on using phrases such as “payee notices”, “notified sums” by payees if a payee notice is not given by the payer. Oh dear. There is a “payment due date” and a “final date for payment”. The essence of the system requires, first, that the payer notifies the payee what it intends to pay, how it is calculated and when it will be handed over. If not given, the payee may give its own notice and it becomes the notified sum. That sum (whoever gives it) is to be paid on or before “the final date for payment”. But if the payer wishes to pay less then it gives a “pay less notice” and that also has strict rules.

So, in short, if a builder fails to inform his subcontractor of sums due and how calculated and if the subcontractor has sent or sends his valuation to the builder with chapter and verse, that subcontract amount is payable unless a pay less notice is issued swiftly by the builder.

Then if the subcontractor is undervalued or underpaid it can pack up and go fishing. As a kid, I used to go fishing … with a sixpenny fishing net, jam jar and my wellies. The jam jar was for the taddies and the wellies for the mud. None of the tadpoles survived my jam jar. But one day many years later I met a beautiful parliamentary draftsman and when I kissed her, she turned into a frog. I wonder if this bill is written by that frog?