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Construction Leadership Council release a new briefing - Covid-19 and Claims and Disputes in Construction Contracts

  • United Kingdom
  • Construction and engineering
  • Litigation and dispute management

19-01-2021

The Construction Leadership Council (“CLC”) released on 11 January 2021 a new briefing in which it summarises the results of a recent survey relating to construction claims and disputes during the Covid-19 pandemic.

The CLC has issued a number of briefings since the beginning of the pandemic which covered, amongst other issues, best practice guidance and collaboration around disputes arising as a result of the pandemic.

These earlier publications were aimed at encouraging the industry as a whole to approach disputes arising out of Covid-19 collaboratively and pragmatically and, so far as is possible, to attempt to resolve these on a commercial basis without resorting to formal dispute resolution.

The research undertaken by the CLC indicates that, whilst efforts have been made across the industry to adopt such an approach, as restrictions continue into 2021 productivity is down, risk of insolvency is rising and, as a result, there has been an increase in the levels of notifications and claims under construction contracts.

Although in the short-term, there were reports of a positive level of collaboration, commercial behaviour in the industry is hardening. In addition, some of those projects which were started before the outbreak of the pandemic are now coming to final account stage.

These factors will likely contribute to an increase in disputes across the industry and a potential move away from the collaborative approach seen at the beginning of the pandemic.

We considered the practicalities around the parties adopting the CLC recommended approach to construction disputes in our article ‘Practical advice to construction projects affected by Covid19: Disruption and prolongation costs’ (which also predicted that this collaborative approach was unlikely to last, and projected a rise in claims in 2021). This article also provided some tips around best practice for Employers and Contractors dealing with claims arising out of Covid-19, particularly in respect of disruption and prolongation, which are the likely bases upon which Contractors will attempt to hang their claims.  

For more information on COVID-19 related disputes, please see our notes on Top 5 COVID-19 issues affecting construction contracts; mitigation and acceleration; Assessing claims for extensions of time; and Practical advice to construction projects affected by COVID-19: Disruption and prolongation costs, or get in touch.