The Week That Was - 10 February 2023
Welcome to The Week That Was, a round-up of key events in the construction sector over the last seven days.
National Apprenticeship week: apprenticeship numbers rise
For the first time in six years, the uptake of construction and engineering apprenticeships has risen. Approximately 26,100 new apprentices started in the sector between August 2021 and July 2022, which is the first annual increase since 2016/17. This uptake represents a 31% uptake from the previous year, and the first time the number of apprentices has increased since the apprenticeship levy was introduced in 2017.
For further reading please see here. Government statistics on apprenticeships and traineeships can be found here.
Calls to monitor silica dust exposure as a "matter of urgency"
Silicosis is the most common chronic occupational lung disease worldwide, and silica dust poses the second-biggest dust danger to construction workers after asbestos. Although preventable, it is estimated that 600,000 workers are exposed to silica in the UK.
The All-Party Parliamentary Group for Respiratory Health is conducting further inquiries into silicosis, following the publication of its 2020 report, Silica – the next asbestos This report looked at the disease silicosis, the diagnosis, treatment and its impact on people's lives. The new inquiry will focus on the risk reduction strategies that may be employed to lower the risk of silica dust exposure.
Following the publication of the original 2020 report, the Parliamentary Group has received updates from industry bodies concerning new technologies offering protection to the workforce from silica dust. These technologies were not available/known about at the time of the original report. The updated report, titled Improving Silicosis Outcomes in the UK comments on these technologies. The report recommends that the HSE takes active steps to look into real time monitoring systems as a matter of urgency.
A copy of the 2020 report can be found here, and a copy of the most recent report can be accessed here.
Part 8 used to resist enforcement of an adjudicator's decision in A & V Building Solutions Ltd v J & B Hopkins Ltd [2023] EWCA Civ 54
The Court of Appeal held that a party, despite being non-compliant with an adjudicator's decision, was entitled to continue with Part 8 proceedings to seek a declaration to challenge the validity of the payment application on which the adjudicator's decision was based. This decision confirmed that a party is able to use Part 8 proceedings as a pre-emptive strike in order to attempt to avoid enforcement of an adjudicator's decision. The Court of Appeal also confirmed that a subsequent final account adjudication supersedes the decision in an earlier interim valuation adjudication. Importantly, the Court of Appeal remarked that the respondent had waived its right to challenge the validity of the payment application by issuing a payment notice.
For more information, please see here.
First Building Safety Act Remediation Contribution Order
On 13 January 2023, the First-Tier Tribunal Property Chamber issued a Remediation Contribution Order under Section 124 of the Building Safety Act 2022 requiring Inspired Sutton Limited to pay £194,680.62 in total to 18 Applicants. This is the first reported Remediation Contribution Order of its kind, and it is likely that similar such Orders will be made in the future.
The Applicants applied for reimbursement of "service charge payments for the remediation of relevant defects and they seek to have those payments returned. They contend that those service charge costs fall within the limiting provisions of Schedule 8 and that it is just and equitable to make a remediation contribution order in their favour" (paragraph 7 of the Final Decision). The First-Tier Tribunal Property Chamber agreed.
The Final Decision dated 13 January 2023 is available here.
McLaren Construction Group Increase in Annual Turnover and Profit
McLaren Construction Group has reported an increase in both turnover and profit from last year, with turnover increasing to c.£750m from c.£540m last year, and with profit increasing to c.£2m from a loss of c.£12.4m last year. McLaren has cited diversification into new sectors, including the refurbishment sector, as being central to its commercial growth strategy.
McLaren has also recently successfully bid for several high profile jobs including the £200m expansion of the ExCel Exhibition Centre and the £130m refurbishment of Portland House in Westminster, London.
For more information, please see here.
Barratt Demonstrates Strong H1 Performance Despite Uncertainty In Housing Market Outlook
Barratt, a UK housing company, showed strong performance in the first half of its fiscal year, with 7% growth in home completions and a 16% increase in profit before tax. Despite this, the CEO, David Thomas, remains uncertain about the outlook for the rest of the fiscal year due to factors such as mortgage availability, homebuyer confidence, and the overall health of the UK housing market. Barratt has already taken measures to respond to current market conditions, such as reducing land approvals, halting the hiring of new staff, and controlling new site openings to manage finances. The company will assess whether further action is necessary based on reservation activity in February and March 2023.
For more information, please see here.
Morgan Sindall Construction and Infrastructure Limited v Capita Property and Infrastructure (Structures) Limited, Sabre Structures Limited [2023] EWHC 166 (TCC)
Capita brought an application to strike out the claim on the basis that there had been an abuse of process in the form of "warehousing", the act of placing a dispute permanently 'on hold'. Mr Justice Eyre found that there were very significant and repeated periods of inaction and found it relevant that the delay had meant that, if the claim was struck out, Capita would have a limitation argument with the potential for success. However, Morgan Sindall argued that it put the action on hold for significant periods to bring the action in line with its action against Aviva, the insurers for Sabre (insolvent), and to get all parties to the stage of a mediation together. Mr Justice Eyre described this as a sensible course and held that the action of Morgan Sindall was not an abuse of process amounting to "warehousing" and dismissed the application.
To read the judgment, please see here.
Authors for this week's edition: Millie Aish, Charlie Underwood, Zack Gould-Wilson and Sikander Azam
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.