The Week That Was - 3 February 2023

Welcome to The Week That Was, a round-up of key events in the construction sector over the last seven days.

Michael Gove admits "ambiguous" building regulations contributed to Grenfell and commits to abolishing leasehold system

The Housing Secretary, Michael Gove, has stated when discussing the Grenfell tragedy that "faulty and ambiguous" building regulations meant that "it allowed unscrupulous people to exploit a broken system".  This is the first time a government minister has made such an admission regarding the regulations in place at the time of, and in the run up to, the Grenfell fire.  Mr Gove said "over many years" there were Government failures.  A six-week deadline of 13 March was announced on Monday 30 January 2023 for developers to sign the contract to pledge to fix the unsafe towers.  Developers who do not sign the contract will be banned from the market.

Whilst talking about the Grenfell tragedy, the senior Conservative told reporters that the party wants to introduce legislation in the final parliamentary sessions of the calendar year to change the leasehold system.  Mr Gove admitted that, legally, these changes would not be straightforward.  He was critical of management charges and expressed that he considers the leasehold system an unfair form of property ownership: "if you buy a flat that should be yours".

For more information, please see here and here.
 
Government commissions BSI to produce MMC standard

The Department for Levelling Up Housing and Communities (DLUHC) has commissioned the British Standards Institution (BSI) to create a new UK-wide standard for modern methods of construction (MMC) homes.  Over the past few years, the Government has been driving the adoption of MMC, which includes off-site manufacturing and construction, in order to improve the cost-effectiveness and timeliness of infrastructure delivery and construction projects.  The introduction of a British Standard for MMC is the latest step in the Government's MMC agenda and is aimed at reducing the costs of MMC Built Homes for both home builders and buyers.  The standard will recommend technical standards for the use of MMC methods to build new homes and will define quality assurance and compliance processes.

The new standard will be subject to consultation later this year, following which it will be introduced as a Publicly Available Specification (PAS).

For more information, please see here.
 
Energy Works (Hull) Ltd v MW High Tech Projects UK Ltd and others [2022] EWHC 3275 (TCC)

In proceedings relating to a waste-from-energy plant in Hull, Judge Pepperall in the Technology and Construction Court held that the contractor was not entitled to an extension of time, nor was it entitled to suspend the works under a IChemE Red Book form of contract on the basis of the employer's alleged breaches of that contract.  Consequently, the employer was entitled to terminate the contract on the basis of the suspension of the works relying on contractor default under the contract or, in the alternative, at common law for repudiatory breach.

To read the judgment, please see here.
 
Chancellor of the High Court calls on judges, practitioners and clients to make PD57AD disclosure regime work well

On 18 January 2023, the Chancellor of the High Court delivered a speech calling on judges, practitioners and clients to "embrace" the PD57AD, titled "Disclosure In the Business and Property Courts".

Key observations include:

• Genuine cooperation, discussion and engagement is required. In most cases, the exchange of letters will not suffice.  The culture should change and parties cannot ignore their obligations.
  
  
• Issues for Disclosure need be no more than "serviceable" for their relatively limited function, and can be revised or supplemented.  Practitioners should apply the mantra "short and concise" and remember that the list of issues should be a practical working document that assists the review team.
  
  
• There is no reason why the Less Complex Claims scheme cannot be used in relatively high value claims, if the nature and lack of complexity of the claim makes it appropriate.

The full text of the Chancellor's speech can be found here. 
 
BSA 2022: Government publishes response to consultation on safety regime for occupied higher-risk buildings and draft key building information regulations

The Government has published:

• Its response to its consultation on proposals for the in-occupation phase for higher-risk buildings in the new safety regime for occupied higher-risk buildings under the BSA 2022.
• A draft of the Higher-Risk Buildings (Key Building Information etc) (England) Regulations 2023, which it intends will come into force on 6 April 2023.

The draft regulations set out what information comprises key building information which must be submitted to the Building Safety Regulator by the principal accountable person alongside their application for registration.  It also sets out the duties on a principal accountable person regarding submitting key building information to the Building Safety Regulator and keeping the information up to date.

A summary of the Government's consultation response can be found here and the Higher-Risk Buildings (Key Building Information etc)(England) Regulations can be found here.

HS2: Jeremy Hunt dismisses media reports that line will end at Old Oak Common

It had been reported that the high speed railway, intended to connect London with Birmingham and Manchester, would terminate at Old Oak Common, approximately five miles away from its intended end point at London Euston.  When asked if he, and the Government, were committed to HS2 going all the way to London Euston, Jeremy Hunt said: "Yes we are and I don't see any conceivable circumstances to why that will not end up at Euston".

It was also reported that a two to five year delay to the entire project was being considered.  Mr Hunt confirmed that work on the first phase of the project - between London and Birmingham - is well under way and that part of the line is due to open by 2033.

For more information, please see here.

Authors for this week's edition: Merrick Morgan, Fiona Engledow, Ella Crawley-Till and Lauren Butler

Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice.  We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date.  You should seek legal or other professional advice before acting or relying on any of the content.