3.1 Construction Issues

Question 1

What form is usually used to appoint BC

Answer 1

JCT form

Question 2

What O must BC pass down in sub-Cs - relating to practical completion

Answer 2

DLP - 12-month period in which to rectify defects

Question 3

Why is Latent Defects Insurance unlikely

Answer 3

Premiums expensive

Question 4

Why is percentage of BC retained

Answer 4

For both Snagging List and Defect Liability Period

Question 5

What is the traditional method

Answer 5

Developer engages architects + PC + BC

Question 6

Why use deed for CW

Answer 6

Longer period to enforce + no need for consideration

Question 7

If C(RoTP)A is used as remedy instead of CW , check what

Answer 7

C/DoA will specify who can claim benefit

Question 8

Tort as remedy - based on what + requirements

Answer 8

Negligence - need DoC + loss reasonably foreseeable

Question 9

How much is the Performance Bond usually

Answer 9

Around 10% of BC sum

Question 10

What is the D&B method

Answer 10

Developer engages architect + BC, and then developer novates Cs to BC

Question 11

Kind of contract with BC

Answer 11

Building Contract

Question 12

Key promise in CW as to standard of work

Answer 12

Exercise all reasonable care, diligence and skill

Question 13

Why obtain CWs

Answer 13

To give direct contractual relationship w/ those involved

Question 14

Remedies for defective works if beyond DLP

Answer 14

Turn to CW - 6 or 12 years depending on if C or D

Question 15

In what method does developer hire employer’s agent

Answer 15

Design & build

Question 16

What is the relationship between CWs + DoA/BC

Answer 16

The two must be consistent w/ each other

Question 17

Who should obtain CWs

Answer 17

Purchaser/Tenant always, and employer if D&B

Question 18

What member of the Professional Team must be appointed by statute

Answer 18

CDM

Question 19

What Act implies certain terms into all construction Cs (w/ BC)

Answer 19

Construction Act

Question 20

What form is used to hire architect - form for DoA

Answer 20

RIBA standard form

Question 21

What might developer require from BC to ensure covenant strength

Answer 21

Performance Bond

Question 22

Two key terms implied into all construction Cs under Construction Act

Answer 22

Timing of payment and ADR

Question 23

Key statement in CW on T’s rights

Answer 23

Free licence to use designs and drawings

Question 24

Two kinds of methods for construction

Answer 24

Traditional and design & build

Question 25

When is CW valid for 12 years

Answer 25

Deed

Question 26

Who hires sub-contractors

Answer 26

BC

Question 27

Three examples of members of professional team

Answer 27

Quantity surveyor, Employers' Agent and sub-contractors

Question 28

What happens if delay in construction leads to late Certificate of Practical Completion - financial implications

Answer 28

Employer can claim liquidated and ascertained damages from BC

Question 29

Last resort remedy for defective building works

Answer 29

Issues should have been caught by architect/EA, but pursuing under warranty costly + time-consuming

Question 30

What is the DLP

Answer 30

12-month period where BC has O to rectify defects

Question 31

How do you achieve forced enforcement of remedies

Answer 31

Side letter/supplemental deed

Question 32

In what method is final control given to BC

Answer 32

Design & build

Question 33

Kind of contract with Professional Team

Answer 33

DoA

Question 34

Why might it be hard for T to rely on limited repair covenants

Answer 34

Issues of proving causation between disrepair + defect which is excluded

Question 35

When does BC get paid

Answer 35

Once completion certified by either architect or EA

Question 36

Why is it hard to force L to enforce remedies on behalf of T for defects

Answer 36

L has to prove loss to enforce - hard if lease is FR&I

Question 37

What role does CDM have

Answer 37

Health & safety role to ensure compliance w/ CDM Regulations

Question 38

Six other options for defective construction works (other than CW)

Answer 38

C(RoTP)A, tort, assignment/DoT, insurance, limiting repair covenants and forced enforcement of remedies

Question 39

What loss cannot be recovered if tort as remedy

Answer 39

Pure economic loss

Question 40

Remedies for defective building works if within DLP

Answer 40

Use second 1/2 of retained monies

Question 41

Who certifies completion in traditional method

Answer 41

Architect

Question 42

When is CW vaild for 6 years

Answer 42

Contract

Question 43

What does practical completion trigger

Answer 43

Snagging List and DLP

Question 44

What is the Snagging List

Answer 44

Minor defects to be corrected before 1st half of money retained paid to BC

Question 45

What are liquidated and ascertained damages

Answer 45

Pre-agree sum as genuine pre-estimate of loss

Question 46

Three main stages of construction

Answer 46

Tender & appointment, construction and practical completion

Question 47

What percentage of BC fee is usually retained

Answer 47

3 - 5%

Question 48

Key statement in CW on T's position

Answer 48

Deemed reliance by T on Consultant's skill, care and diligence AND T not liable to pay consultant