Helen Stuart of Trowers & Hamlins has advised on the Construction Leadership Council's new guidance on future proofing construction contracts to deal with Covid-19 and record keeping. This new guidance builds on the previous guidance on Covid-19 contractual best practice which Helen also advised on.
The contractual best practice sought to encourage parties to hold collaborative discussions to try and resolve covid-19 related issues as and when they arise, whilst also making sure that parties comply with their contract administration obligations, and provided proformas to assist the parties in doing this.
The guidance on record keeping builds on this previous guidance by advising parties on what records to keep and how they should be stored to ensure that parties can adduce substantiation to support any covid-19 related claims. Such substantiation can help the parties resolve claims efficiently as well as potentially helping to mitigate any delays and/ or additional costs.
The guidance on future proofing contracts has been developed in response to feedback from the industry that many would benefit from further guidance on amendments to new contracts to specifically deal with the impact of Covid-19. It provides 3 basic options for amending both the JCT Design and Build 2016 and the NEC 3&4 ECC forms of contract, depending on the parties' negotiation on the allocation of risk for pandemics going forward.
Helen Stuart commented:
"I am pleased to have been able to contribute to the development of this guidance to assist parties in the industry further in trying to resolve claims and to assist with considerations for future contracts so that parties can get new projects on site and look towards recovery.
Good record keeping can make or break claims and far too often we see good claims fail because they don’t have the records to back them up. At a time when staff resources may be limited due to furloughing it becomes even more imperative to ensure that good record keeping procedures are in place.
In terms of future contracts our advice is to discuss the implications of covid-19 on costs and the programme early on in negotiations and then the contract can be amended accordingly to specifically address the issue. The guidance gives options as a starting point for parties to consider going forward."
Whilst the future proofing guidance and draft amendments provide a good starting point for parties, as the guidance suggests, parties may want to take advice on any amendments (particularly on sharing financial risk).
If you would like further assistance on contract amendments please contact us as we have already dealt with amending different forms of contract which specifically deal with the risk of covid-19 on projects going forward.
To review the guide please click here.
