In the beginning…
A lot has changed in the ten years since “Packaging construction and engineering documents”, the first of my occasional blogs on construction law issues, was published.
In October 2008 we were living in St Albans, our son was still at school and Labour were in power. Lehman Brothers had recently collapsed and the global financial crisis was in full swing. Liverpool were top of the Premier League, with Aston Villa and Hull City in the top five. Tottenham Hotspur were bottom and, having sacked Juande Ramos, had just hired Harry Redknapp to revive their fortunes. Lewis Hamilton was on the verge of being crowned F1 world champion (well, not everything changes).
Meanwhile the Government was consulting on proposed changes to the Construction Act, responding to concerns (expressed loudly by Rudi Klein and others) that the legislation didn’t offer sufficient protection to the “little guy” and needed beefing up in order to achieve its objectives. (Some of us look back wistfully to a time without pay less notices, when Tolent clauses - Bridgeway Construction Ltd v Tolent Construction Ltd (2000) CILL1662 - roamed the earth devouring any small sub-contractor who dared to challenge them.)
As time goes by
Unlike some prolific authors, my approach to blogging has been selective. I have tended to go into print only when some judicial pronouncement or other legal development has particularly piqued my interest (or outrage). I don’t do social media, but blogging is perhaps a halfway house; allowing me to express opinions that would seem brash in a learned article, without stooping to Trump-style insults.
I’ve been pleased to receive occasional supportive comments, and very few that could remotely be classified as hostile. My blog on fitness for purpose remains the all-time “most read” (presumably thanks to the Google search engine) and is still regularly invoked by clients and colleagues as the “Authorised Version”. I even managed to elicit a sympathetic response from a bondsman after trashing the surety industry in Ziggurat, although my friends at the NEC didn’t take quite so kindly to my (largely tongue-in-cheek) analysis of their “alliancing” guidance note.
However, my main focus has been on recent cases, particularly those in which (IMHO – as my son would say) the judiciary has gone astray. The Court of Appeal’s decision in Rainy Sky was perhaps the high water mark of this. It struck me as a classic case of “ivory tower syndrome”; a bunch of very clever people completely failing to understand the commercial context that had given rise to the issue before them. I was bold enough to describe their decision as “ludicrous” and expressed the hope that the Supreme Court would look again at the matter. Thankfully, they listened to me (well, I don’t suppose they actually read my blog, but at least they came to the right result).
Rainy Sky was, of course, the precursor to probably the most significant judge-driven development in the law over the last ten years; the line of Supreme Court cases dealing with contract interpretation, from Arnold v Britton through to Wood v Capita. As is well-known, those cases restated the primacy of the words used by the parties over considerations of business common sense.
On one analysis, this may be seen as an abnegation of the Rainy Sky approach. However, in my view that analysis is over-simplistic. Rainy Sky concerned a sloppily-drafted provision which the parties accepted was capable of two different meanings, one of which (that chosen by the Court of Appeal) led to an uncommercial result. In Arnold v Britton, on the contrary, the drafting of the price adjustment clause was perfectly clear. With hindsight it may seem to have produced a harsh result, but looked at through the eyes of the parties in 1977 (when double digit inflation was the norm) it would have appeared neither unusual nor especially onerous.
In the end, as the Supreme Court noted, the Court’s task is to determine what the parties (objectively) meant by the words they had chosen to use. On that basis, in my view, Rainy Sky and Arnold v Britton are not merely readily reconcilable, but in fact entirely consistent.
Other cases where I have taken issue with the judiciary have included Langstane (Scottish, but nevertheless influential; I described the reasoning as “highly dubious” and suggested the court was “out of touch with the real world”); Parkwood (“simply wrong”; worryingly it is still good law, although whether it will be followed in a future case is another matter); and Lakehouse, where I suggested that “justice has been sacrificed on the altar of literalism”. I was quite pleased with that one! I understand that Lakehouse is being appealed and it will be interesting to see what the higher courts make of it.
To be honest, I won’t even attempt to predict how the law might develop over the next ten years. The judiciary will no doubt continue to surprise us and of course Brexit (in whatever form) is likely to have impacts that none of us can foresee.
However, I strongly believe that the UK construction industry itself will need to change radically if it is to remain competitive in a post-Brexit world. Tinkering around the edges of tendering and payment practices will not solve the deep-rooted structural issues that bedevil the industry. Something much more fundamental is needed, and I have little doubt that modularisation and robotics will provide at least part of the answer.
The route from today’s dysfunctional and unproductive industry to the new Nirvana isn’t immediately obvious, but I expect some brilliant disruptor will find a way to bridge the gap. That in turn will drive seismic changes in the content and shape of the supply chain and the contracting models used to deliver projects, in ways that we cannot currently imagine. I suspect (and hope) that the industry in 2028 will look very different from what it does today.
On a lighter note, maybe Liverpool will finally have won their first Premier League title. And what price Lewis Hamilton for another F1 crown in 2028?
A version of this blog was first published by Practical Law Company.