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Will COVID-19 have an impact on Construction & Development?

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Will COVID-19 have an impact on Construction & Development?

Will COVID-19 have an impact on Construction & Development?

COVID-19 is upon us and we're assisting our clients to manage the effects on development on an ongoing basis.

The important thing is not to panic, to recognise and mitigate the effects wherever possible and put the wellbeing of the workforce above all else. Legally speaking the greatest asset is the protection afforded by a well-drafted contract. Below are some of the key things to check in the JCT Design and Build 2016 (“JCT 2016”):

Force Majeure

Most building contracts include a force majeure clause, which enables the parties to recognise an event which intervenes with progress outside of both parties’ control and determines the steps the parties will take. The JCT 2016 contract lists force majeure as a Relevant Event (which enables extensions of time to be legitimately and objectively made), but no definition of what force majeure might constitute is offered.

Insurance

The insurance requirements under the contract will determine who bears the cost of the effects on the works. Most JCT contracts place the burden of works insurance on the contractor, but if the works are taking place on an existing structure, the Employer will bear the cost. This means ensuring that cover is available for delays, damage and gaps in materials which are likely to appear as a result of the diminished resource.

You should also check the requirements for employer’s liability insurance on both sides of the coin to assess whether provision is adequate for the effects of COVID-19 on the respective workforces.

Health & Safety

Health and Safety is a statutory requirement and is often as contractual as the parties decide to make it. The JCT 2016 separates the statutory health and safety requirements under the Construction (Design and Management) Regulations 2015 (“CDM Regulations”) from a supplemental clause detailing more in-depth health and safety measures such as site inductions and employee consultations.

Supplemental Provision 6 enhances the contractor’s contractual duties as regards health and safety and stands both parties in good stead for good health and safety practice throughout the life of the contract. Usefully, the provision requires the contractor to comply with any and all approved codes of practice produced or promulgated by the Health and Safety Executive, so any and all updates issued by HSE are immediately applicable.

​GET IN TOUCH

If your business needs legal support with any issues arising from COVID-19, please get in touch with Caroline Watkins.

All information in this document is accurate at the time of writing. It is meant for general information only and is not legal advice.