ABSTRACT
The Housing Grants, Construction and Regeneration Act 1996 came into force on all new construction contracts entered into after 1 May 1998. The Act embraces all normal construction operations including labouronly contracts, site clearance, demolition, repair works, landscaping, and consultancy agreements such as architects, consulting engineers etc. However, excluded are supply-only, supply and fixing of plant in pro-
cess industries, off-site manufacture, contracts with residential occupiers, contracts not in writing, PFI contracts (but not the construction contracts entered into pursuant to them), and certain other definitions. Sweeping reforms were introduced, on the back of the Latham initia-
tive, aimed at removing the worst of the injustices, which have caused so much trouble in the construction industry. These reforms fall under two prime headings, namely ‘payment’ and ‘adjudication’. The Act and the accompanying Government scheme have each been
the subject of criticism. As to adjudication, the main criticism has focused on ‘enforceability’ of the decision. As to payment, the minimum requirements of the Act are rather modest, lacking in specifics, and in some ways offer less protection than that which was formerly available in the industry’s standard forms of contract. It also seems that there are many ‘loopholes’ that enable a party to
frame their conditions of contract in order to evade the true spirit of the Act. Later in this section, we summarise some of the ‘dirty tricks and dodges’ being used by various builders. However, despite these shortfalls, the fact remains that the Act rep-
resents, along with the previous Latham initiatives, a continuing ‘wind of change’ that is blowing throughout the industry, at the instigation of
the judiciary. One way or the other, it is going to become progressively harder to
operate like Al Capone and those who do so will probably incur a lot of unfavourable publicity in the trade press. This in itself may well be a major factor, and it is vital that individual subbies feed back their comments through their trade federation (e.g. ECA, HVCA). The author is not legally qualified, and does not pretend to be an
‘expert’ on the Construction Act. Professional advice should always be taken before action or reliance upon these modest notes. However, the following pages seek to highlight the main features in a practical way.
