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Top ten legal issues

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Legal firm Simmons & Simmons has produced a summary of the top ten construction issues of 1997 in its latest Construction Law Group Newsletter. It defines these as:

1 Questions and answers on the New Arbitration Act 1996. The Act became effective on 31 January 1997, and the overriding question, according to Simmons & Simmons, is: will the Act reform the process of arbitration so that disputes can be resolved more easily? It discusses this and other questions.

2 Claims under performance bond. A recent commercial court decision has sought to clarify some of the issues. Contractors who are party to a bonded contract need to ensure that their position is protected and the beneficiary is unable to claim under the bond in circumstances where he does not genuinely believe that any sums are due under the bond.

3 The Party Wall etc. Act 1996. It came into force on 1 July 1997 and has extended the current party-wall procedure in London to the rest of England and Wales.

4 Limitation of the Loss; The Case of bbl and following. Reform of the laws of joint and several liability was rejected, but a number of cases introduce precedents which may limit the extent of liability for construction professionals and their insurers.

5 Contribution by wrongdoers. Two recent cases have clarified the law to allow an employer on a construction project to recover against a professional adviser who, while not directly responsible for a mistake, was responsible for failing to spot the error.

6 The Statutory Scheme for Adjudication: the Scheme for Construction Contracts Regulations 1997. This follows the trend towards less adversarial forms of dispute resolution by imposing a form of adjudication if there is no such provision in the contract.

7 Outlawing 'Pay when Paid' clauses. Simmons & Simmons argues that although the Construction Act goes some way toward improving the subcontractor's position, it does not necessarily go far enough.

8 Certification: 'De-Crouching' arrangements. A complex issue following a legal case in 1984, it deals with the efforts of parties to disable the arbitration clauses in their contract. Simmons & Simmons proposes some alternative wording.

9 Set-Off vs. Abatement: the distinction. The Court of Appeal has set out the difference, which is vitally important for main contractors, sub- contractors and employers in determining whether they have a right to withhold money.

10 The Treasure Act 1996. This changes the law relating to discovered portable antiquities in England and Wales.

For copies of the newsletter, tel 0171 628 2020.

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