Beale & Co News: Market Trends in the Construction Industry in 2023 and how to Tackle Them in 2024

As the first two months of 2024 draws to a close, we feel it is an opportune time to reflect on some of the trends we saw in the construction industry in 2023 and hopefully look with some positivity at what is to come in 2024.

2023 was, in lots of ways, a difficult year for the construction industry. It was plagued by inflation, increased cost of materials, skilled labour shortages, a cost-of-living crisis and the ongoing effects of the Russo-Ukrainian war. It was not all doom and gloom though. We saw a real increase in the focus on climate change and decarbonisation in construction projects globally and in the use of digital technologies to improve efficiencies. We also saw the introduction of secondary legislation under the Building Safety Act which reflected a hugely important step towards a safer built environment.

This article will reflect on these important trends.

Market trends in the construction industry in 2023 and how to tackle them in 2024 | Beale & Co (beale-law.com)

Written by Andrew Croft & Ellie Eastwood

Lunchtime Webinar Report: Consultants – Is your duty of care under attack?

On the 3rd of May AIA UK members were invited to attend another of Beale and Company’s popular lunchtime legal webinars. The subject was how the use of new standard owner/consultant contracts place a more onerous duty of care requirement on architects than the traditional “reasonable skill and care” clauses of earlier contract versions. Entitled, “Is Your Duty of Care Under Attack?”, the webinar was presented by Will Buckley and Simi Sivapalan. Attendees received one continuing education learning unit for attending.

Traditional standard forms of contract, such as those provided by the RIBA and ACE make statements such as “exercise reasonable skill and care in conformity with the normal standards of the Architects’ profession” and “exercise reasonable skill, care and diligence in the performance of the Services”. Architects need to be aware that new versions of standard forms of contract from the ACE, FIDIC, NEC4, and the RIBA provide for an elevated duty of care! These contracts have moved beyond the use of “reasonable skill and care” with clauses such as those shown in the slides below.

The new contracts also have more onerous requirements regarding fitness for purpose, specification of deleterious materials, and use hard to define terminology such as “in the spirit of mutual trust and cooperation”. The webinar also addressed non standard contracts like those often provided by clients. These must be reviewed carefully as they often contain clauses that impose an even higher standard of care. Watch out for clauses such as those illustrated in the slides below.

The presenters discussed several recent legal cases to illustrate the challenges an elevated duty of care can present to design professionals. The important “take aways” from this fascinating webinar are:

• Where possible, try and limit standard of care to “reasonable skill and care”
• Include an overarching duty to exercise reasonable skill and care
  •  But remember, an obligation to use reasonable skill and care is not an overriding provision unless stated
  • Best practice to qualify strict obligations by “exercising reasonable skill and care” “subject to” wording may not always be sufficient
• Check for hidden obligations - strict and fitness for purpose obligations may not always be obvious Civil liability policy is much preferred to a negligence based one!

For further information on this subject, Will Buckby can be contacted at 020 7469 0411 and w.buckby@beale-law.com

Also, AIA UK members have access to the free Legal Helpline provided by Beale & Co at (0) 20 7469 0400 (please quote “AIA UK Helpline”).

By Michel Lischer FAIA

Construction payment charter updated – a missed opportunity?

The Government’s Construction Leadership Council has published an updated Construction Supply Chain Payment Charter to reflect commitments in the original charter. In our view much more could have been done to strengthen the updated charter; the onus remains very much on the industry to tackle the issue of late payment.

READ our article which details what's new and what impact the new charter will have.

By Will Buckby and Andrew Croft

Beale & Company Reports from the Courts - February 2016

In our regular round up of recent court cases of importance to the construction industry, Andrew Croft (Associate) and Simii Sivapalan (Assistant Solicitor) of Beale & Company consider a case highlighting that a limitation clause does not remove liabilities to all parties on a contract; and another where a court considered the late payment provisions of the ‘Construction Act’ where insolvency was a risk.

This article was first published in Construction Law's February edition.

To read the full article, please click on this link.

Authors: Andrew Croft and Simii Sivapalan

RECEPTION WELCOMES NEW CHAPTER SPONSOR, BEALE & COMPANY

On October 6th, Beale & Company hosted a reception and seminar for Chapter members at their new City office.  The purpose of the event was to introduce members to Beale's new Legal Telephone Helpline and to make attendees aware of the onerous new rules of CDM 2015.  We had a good turnout for the event with many familiar faces and a few new members in attendance.  

An introduction was made to the exciting new member benefit that is being provided by Beale & Company - the free Legal Helpline!  An experienced team of solicitors is a phone call away and happy to provide members with guidance in respect of issues arising in connection with their practices in relation to:

• Appointments and collateral warranties
• Assignment and novation
• Non-payment
• Disputes
• Intellectual property rights
• IT
• Employment
• Corporate and commercial matters

To get in touch simply telephone +44 (0) 20 7469 0400 (please quote "AIA UK Helpline"!After an enjoyable drinks and canapé reception, attendees earned 1.5 LUs by participating in a discussion about the new CDM 2015 requirements.  These now applies to all construction projects in the UK.

Solicitors Andrew Croft and James Vernon gave an overview of the regulations and spoke specificallyabout the new role of the so called Principal Designer.  The new regulations came into effect on the first of October and expand the responsibilities of the architect.  The regulations apply to every construction project in the UK, no matter how small, if more than one contractor or subcontractor is involved.

There was certainly a great deal of uncertainty among the attendees about the architect's responsibilities and liabilities with the new regulations.  This was reflected in the questions asked by the audience.  Beale & Company have several resources available to help Chapter members better understand CDM 2015.  These include a "white paper" and a pre-recorded webinar.  For those needing additional guidance, please contact Beale & Company on the Chapter's new Helpline.Beale & Company is a commercial law firm with a long history of acting for consultants and architects, with specialist experience in the construction, engineering and infrastructure sectors, both in the UK and internationally.  We are pleased to welcome Beale & Company to the AIA UK!

BEALE & COMPANY HOSTS BIM WEBINAR - MICHAEL LISCHER

On the 16th of September AIA UK Chapter sponsor, Beale & Company, hosted another of their popular lunchtime webinars.  This webinar was entitled, "Taking Stock on the Practical and Legal Implications of BIM", and was co-hosted with Arup Associates.  Andrew Croft from Beale & Company and Casey Rutland from Arup Associates spoke about current best practice and the legal issues that architects need to consider in relation to BIM (Building Information Modelling).

The use of BIM has increased significantly in recent years and the UK construction industry is making progress in the adoption of BIM.  This follows the UK Government’s mandate to use BIM on all public sector projects by 2016.

Casey noted, "there are many benefits to using BIM, there are also barriers to its use".  Benefits include:

• Better communication among project team members
• Information is continually updated
• Enhanced confidence
• Barriers to the use of BIM include:
• Concerns over rights and liabilities
• Intellectual property rights issues
• A lack of case law for legal guidance

Andrew discussed the legal issues and illustrated how the concerns can be mitigated with an understanding of the risks and use of the appropriate contract.  He concluded by stating, "BIM does impact on the architect's rights, obligations and liabilities, and this must be managed.  Agreeing the basis of collaboration is key, and making certain the design contract reflects the use of BIM are the best ways to minimize the risk."  

The webinar pointed out that BIM type collaborative contracts are becoming more common and everyone should be prepared to use them!  

AIA UK members earned 1 learning unit for listening to the webinar.