Due Diligence in Construction Contracts

May 22, 2014

In Sabic UK Petrochemicals Limited v Punji Lloyd Ltd [2013]EWHC 2916 (TCC) the Court considered the meaning of the obligation in the contract to carry out the works “with due diligence”. Mr Justice Stuart-Smith decided that it meant to proceed “continuously, industriously and efficiently with appropriate physical resources so as to progress the works steadily towards completion substantially in accordance with the contractual obligations.” The Judgment, much of which is case specific, goes on to make it clear that if one of the specific contractual objectives becomes impossible to achieve there is no reason to consider that “due diligence” obligation will become less onerous, and indeed may require the contractor to take accelerative or other measures. Delay, of itself, does not automatically demonstrate a lack of due diligence, and whether it does will depend upon the construction of the contract and the other contractual obligations undertaken by the contractor.

Nuisance and Planning Law

In Coventry v Lawrence [2014] UKSC 13 the Supreme Court gave Judgment in respect of a private nuisance appeal. The particular nuisance was noise, and as such it is highly relevant to all construction sites in the United Kingdom, especially those in built-up areas. The Judgments cover many aspects of the tort of private nuisance but one of the most interesting aspects was that it made clear that the fact that the nuisance was committed as an inevitable consequence of the conduct of an activity for which planning consent had been granted will not deprive the complainant of their right to make a claim in respect of that nuisance. In other words the carrying on of a lawfully authorised activity under planning law will not, by reason of that fact, over-ride the complainant’s common law rights. At first instance His Honour Judge Seymour QC had taken the view that planning consents should not be considered when determining whether a nuisance had been committed. In the Supreme Court, Lord Neuberger stated that the grant of planning consent does not make a development lawful, and all that it means is that the bar imposed by planning law on the development , in the public interest, has been removed. The Supreme Court disagreed with the approach of the Judge at first instance on the effect of there being a valid planning consent in place, but it restored his Order on other grounds, thereby reversing the Court of Appeal’s Order.

Rolling Road Tax Exemption

Owners of classic cars should be pleased to learn that the Government have reintroduced the rolling road tax exemption. This will apply to vehicles 40 years old, and took effect from 1 April 2014. It is unlikely in itself to mean the difference between running a “classic” and not doing so, but it demonstrates a recognition by the Government that such vehicles are part of our heritage, which can only be a good thing for the industry, as well as the owners.

Employment:Garden Leave

February 27, 2014

The case of J M Finn Limited v Holliday is the most recent case to grapple with the vexed concept of garden leave, and what duration may be reasonable.


Construction: Building Information Management

Although BIM (Building Information Management) first appeared conceptually many years ago, it has come to prominence much more recently, partly as a result of the UK Government Report entitled “Construction 2025”.