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Presidents Column: January 2018

January 3, 2018 by NSC in News
While the standards forms of construction contract – NEC and JCT – aren’t perfect, in my opinion they provide a pretty good balance for both main contractors and sub-contractors. And until the adversarial contracting model changes to something much more collaborative, they allow both parties to share project risk.

These contracts are also what’s been agreed by the construction sector as a whole. Together, representatives from all parts of the supply chain decide what stays, what goes and what needs to be added.

So it’s always galling to see clauses that have absolutely nothing to do with the project specification or risks specific to that job added to a sub-contract. These additions aren’t minor either. They can run on to hundreds of additional clauses, scattered throughout the contract, and can have significant consequences for a sub-contractor.

While all sub-contractors are affected, this is particularly unfair on small sub-contractors who don’t always have access to on-tap legal advice and who might miss a small yet important detail.

Those sub-contractors that belong to a trade association like BCSA are in a better position, being able to access targeted commercial and contracts training and dedicated legal help lines. But when tender negotiations have come down the wire and the main contractor wants work to start asap, the time available for due diligence evaporates for everyone.

Some of my personal bugbears are blatant attempts at risk shifting.

For example, when a contract says a sub-contractor can’t rely on any information about site conditions supplied by the main contractor and must verify all the information themselves. Of course this is an impossible task and it goes way beyond any realistic expectation of taking reasonable care.

Or the explosion in the number of indemnities and in how wide they are – indemnities are always onerous and this just adds to the burden on the sub-contractor.

So why can’t we just use the standard forms of contract, with additions limited to those necessary for the specific job? This would certainly save time and money for contractors and sub-contractors, and might even take us one step closer to a more collaborative way of working.

Tim Outteridge
BCSA President & Sales Director Cleveland Bridge

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