BuildLaw, Issue 14: June 2012

Welcome to the June 2012 Issue of BuildLaw in which we bring you articles from New Zealand, Australia and the United Kingdom on building and construction law matters.

You can either download and print the complete newsletter or read those articles of interest.

Articles in Issue 14 are as follows:
 
Editorial Concurrent Delay:
City Inn not Law in England, but what is?
John Green's comments on articles in this issue and developments in the industry since our last issue...

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Our first article by Aidan Steensma of CMS discusses the perennial issue of concurrent delay in light of the recent decision of the Commercial Court in 2011 in Adyard Abu Dhabi v S D Marine Services [2011] EWHC 848 (Comm) which has raised doubts over the majority and minority views in decision of the Scottish court in City Inn Ltd v Shepherd Construction Ltd [2010] CSIH 68. The Adyard Abu Dhabi case is an excellent and simple judicial statement about entitlement to time in the event of concurrent delays. It is well worth looking at – especially paragraph 276...

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BONDS Encouraging people to do what they said they would. Copyright Infringement in House Plans: When will inferences be drawn about similar features?
John Walton’s paper; Bonds - Encouraging people to do what they said they would, questions the need for issuing bonds using the standard form attached to NZS3910:2003. NZS3910 and NZS3915 are the only civil engineering standard forms of contract published in New Zealand and this comprehensive and thought provoking paper is most timely given the latest round of revisions to NZS3910 is currently underway...

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This article and the judgment (which can be found on our website) will be of particular interest to those who are in the business of designing residential homes for the general market where ‘standard plans’ are commonplace, readily obtained,  and in respect of which, there appear to be more design and construction similarities than differences these days. A word of caution to would be architects. The plans at issue are annexed to the judgment - do not become the subject of another!...

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Councils' Duty of Care for LIM Information is Confirmed Council Avoids Liability for Leaky Building
The Supreme Court has confirmed, in the long awaited decision in Marlborough District Council v Altimarloch Joint Venture Limited and Others [2012] NZSC 11, that councils owe a duty of care to the recipient of a Land Information Memorandum (LIM) if the LIM negligently misstates information it is obliged to contain. Denis Sheard, Special Counsel in the Local Government and Environment practice at Simpson Grierson says the judgment is a reminder to all territorial and unitary authorities of the need to ensure that information held is accurate, easily accessible, accurately captured and correctly recorded in the LIM preparation processes...

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In the article ‘Council avoids liability for leaky building’ we look at the recent Supreme Court decision in McNamara & Ors v Auckland City Council  SC 85/2010 [2012] NZSC 34 in which the Supreme Court upheld the Court of Appeal's decision that the Auckland City Council did not owe a duty of care in respect of a building certificate issued by Approved Building Certifiers Ltd, a private certifier approved by the Building Industry Authority...

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BINGHAMS CORNER Was There a Dispute? - Crystallisation of Disputes and the Severability of an Adjudicator's Decision
In All Aboard The Fair Pay Express, Tony Bingham tells us that Network Rail buys an awful lot of building work … something in the order of £4bn worth a year. He also says government departments were the worst payers in the business once, but the light has dawned. Really?...

In Careful Who You Trust, Tony discusses the recent TCC decision in Walter Lilly & Company Ltd v Mackay & Anor [2012] EWHC 649 (TCC). Walter Lilly decided to sue the developer DMW and asked for copies of all the correspondence between DMW and its claims consultant. That caused the balloon to go up....

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We look at the recent decision of Mr Justice Akenhead in the case of Working Environments Ltd v Greencoat Construction Ltd, [2012] EWHC 1039 (TCC) to look at the whether a dispute can arise before the date for payment? And when issues of jurisdiction arise, can an adjudicator’s determination be severed by the courts to exclude those issues that fall outside his or her jurisdiction so as to give effect to that part of the determination in respect of which the adjudicator did have jurisdiction? 

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Superintendent’s Obligation to Act Honestly, Fairly and Reasonably Sweett As - No Duty Owed by QS to ensure Bond executed
In the article, Superintendent’s Obligation to Act Honestly, Fairly and Reasonably, we discuss the New South Wales Supreme Court case of Walton V Illawarra [2011] NSWSC 1188 in which McDougall J held that the obligations on the Superintendent were to act honestly and fairly and determine reasonable EOTs to be granted where Walton had shown a right to them and to determine reasonable values for the variations. The Judge observed that the Superintendent could act honestly and fairly, but if she did not arrive at a reasonable decision in respect of EOTs and the value for variations, then Walton had not received what it was entitled to receive under the contract and Illawarra was in breach.

This case demonstrates that when the Engineer is the designer, the contract administrator, and the employer’s agent, the potential for conflict of interest is patently obviously for all to see, save for perhaps by the poor blinkered Engineer!...

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In ‘Sweett As’ we look at the duties of professionals to procure bonds following the recent decision of HHJ Childblood QC in Sweett (UK) Ltd (formerly Cyril Sweett Ltd) v Michael Wight Homes Ltd [2012] EW Misc 3 (CC).

Whilst this is a UK county court judgment, it will no doubt come as some relief to those who act as consultants and principal’s agents and whose obligations include, inter alia, “arranging” for bonds to be provided by contractors. It would seem that such obligations are subject only to an implied common law duty to exercise reasonable skill and care, rather than being strict or absolute obligations as was argued in this case...

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Book Reviews:

Kennedy-Grant on Construction Law, 2nd Edition
This book is a truly impressive publication in every respect. It comprises 958 pages. The text is set out in 31 Chapters. The full table of contents runs to 40 pages and there is a summary of contents for ease of reference. The author’s helpful introduction sets out the scope and structure of the book and the introductory remarks put the component parts of the text in perspective.

This is the second edition of the work first published in 1999. Although the basic structure of the book remains unchanged, this new edition is, in large measure, a comprehensive new text. The first edition has been extensively rewritten and the coverage of New Zealand law substantially updated and widened. 

"This work is truly indispensable. It is already a standard work of reference, and the author is to be congratulated."

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An Authorised Nominating Authority
under section 65 of the Construction Contracts Act 2002