By Claire King 

Fenwick Elliott LLP

In June 2018 the NEC published its first Alliance Contract “designed for use on major projects or programmes of work where longer-term collaborative ways of working are to be created”.[1] In this Insight we examine what is meant by alliancing, its perceived benefits and when it tends to be used. We then review how the NEC4 Alliance Contract works and what it has to offer given the relatively limited market of standard form alliancing contracts. 

What is Alliancing?

HM Treasury’s Alliancing Best Practice in Infrastructure Delivery defines alliancing as:

“… an arrangement where a collaborative and integrated team is brought together from across the extended supply chain. The team shares a set of common goals which meet client requirements and work under common incentives.”[2]

The key to alliancing is the alignment of the parties’ goals commercially so that parties are financially motivated to focus on achieving agreed outcomes.  Typically in alliancing (as opposed to partnering), cost overruns and savings are shared between the parties regardless of how they came about.[3] The idea is that this results in the confrontational behaviour, sometimes associated with traditional construction contracts, being avoided. In particular, alliancing focuses on creating an integrated project team which is highly motivated to ensure the best overall project outcome as opposed to serving its own particular employer’s interests.  Alliancing arrangements often also extend down the supply chain in order to try and encourage innovation and good value.

Some alliancing contracts take the non-confrontation goal to its extreme by including “no dispute” clauses which essentially waive contractual and tortious claims against alliance members in advance with the exception of fraud or wilful default. It is debatable whether such clauses are in fact enforceable, and their impact on insurance policies, but historically they have been widely used in Australian alliancing contracts.[4] 

What types of construction works tend to use alliancing?

Contracts using alliancing tend to be high value and are frequently for longer-term projects.  Alliancing was first used in the UK for delivering investment in the North Sea oil fields during the 1990s.[5] In Australia and New Zealand alliancing is also widely used for delivering high value infrastructure investment such as for roads.[6]

Examples of alliancing contracts within the UK include:

1. Alliances entered into by British Gas with lead partners and members of their onward supply chain to deliver their brownfield investment programme;

2. The Anglian Water @one alliance which describes itself as: “a collaborative organisation of consultants and contractors working together to deliver more than half of Anglian Water’s capital investment programme”;[7]

3. Alliances entered into by Network Rail. For example, Network Rail entered into an alliance with Atkins, Laing O’Rourke and VolkerRail for the design and construction of the East–West Rail phase 2.[8] 

What are the perceived benefits of alliancing?

Alliancing is perceived as particularly beneficial where there is a complex environment with multiple stakeholders, interests and goals. The idea is that creating an alliancing contract will help collaboration and enable better performance. Similarly, it is viewed as a good tool for achieving performance improvement and changing behaviour patterns. Alliances are also popular where there is an extended supply chain and either innovation of some form is required or direct customer access if through that supply chain.

As outlined above, alliancing is generally perceived to be more beneficial for long-term and high value projects. This is essentially because the costs of setting up an alliance are high and the benefits that alliancing may bring will need to be discounted against this cost. Obviously for higher value projects the benefits are likely to be more tangible from a cost/benefit point of view.[9] Time is also required to build the relationships and trust required within the alliancing chain and that means that alliancing is more likely to suit longer-term projects. 

What standard alliancing contract options are already available?

For high value construction projects a bespoke alliancing contract may well be used.  Indeed in the 2012 Effectiveness of Frameworks Report, it was found that the absence of a suitable standard form is impeding progress in the use of alliancing etc.[10]

Other standard form alliancing contracts do exist including the recently published TAC-1 (Term Alliance Contract) published by the ACA[11] in conjunction with King’s College London.[12] The same group also publish the FAC-1 or Framework Alliance Contract which came out in 2016. The FAC-1 can be set up between one or more clients and other alliance members. These alliance members can include contractors, consultants and specialists as required. An Alliance Manager leads the agreed procedures and makes sure the FAC-1 is adhered to by the parties.[13]

The TAC-1 contract is described in detail on the ACA and King’s College joint website, Alliance Forms, as follows:

“TAC-1 is a versatile standard form term alliance contract which:

– enables a client and its team to obtain better results from any term contract

– helps to integrate a team into an alliance

– helps to obtain improved value through building information modelling

– is designed for use in any sector and in any jurisdiction.

TAC-1 supports and integrates the provision of any type or scale of works and/or services and/or supplies. It is endorsed by the Construction Industry Council and by Constructing Excellence. . . .

TAC-1 sets out:

– the ‘Alliance Members’including the ‘Client’, the ‘Provider’, and an in-house or external ‘Alliance Manager’with the facility to add ‘Additional Alliance Members’. . .

– why the term alliance is being created, stating agreed ‘Objectives, Success Measures, Targets’and‘Incentives’. . .

– mobilisation and handover procedures and improved engagement with Stakeholders . . .

– a clear ‘Order Procedure’for simple or complex ‘Orders’, supported by ‘Template Order Documents’. . .

– what the Alliance Members will do to seek ‘Improved Value’, working together through ‘Supply Chain Collaboration’and other agreed ‘Alliance Activities’in accordance with an agreed ‘Timetable’. . .

– how the Alliance Members will manage risks and avoid disputes using a shared ‘Risk Register’,‘Core Group’governance and ‘Early Warning’ with  options for an ‘Independent Adviser’and alternative dispute resolution . . .

– flexibility to include particular ‘Legal Requirements’and ‘Special Terms’required for any sector and in any jurisdiction . . .”

The same website also provides a very helpful description of the FAC-1.[14] 

How does the NEC4 Alliance  Contract work?

As can be seen from the above, the options for standard form alliance contracts are not very wide.[15] In that sense the arrival of the NEC4 Alliance Contract is a welcome one. The contract also has familiar provisions, management processes and terminology which are an advantage for those who are used to working with NEC form contracts.

So how does the NEC4 Alliance Contract work?

The NEC4 Alliance Contract describes itself as a “true alliancing contract” because all the parties involved sign up to the same single contract.[16] If a subcontractor is a member of the alliance then they become a partner with the same standing as other members. If they are not a member then the Guidance Notes make it clear they will need to be contracted to a member of the alliance in the traditional way. However, the Alliance Manager (see further below) would have to approve the subcontractor first.

The Alliance, Alliance Board and Alliance Manager

The Alliance itself consists of all of the parties who have joined together to deliver the project (potentially but not necessarily excluding subcontractors). The Alliance includes the Client. Members of the Alliance have an obligation to:

  • Collaborate with each other to achieve the objectives of the alliance as well as the objective of the individual “partners” to the alliance;
  • Work collectively to support the delivery of the contract on a “best for project basis”;
  • Develop and use common systems and processes as set out in the Implementation Plan;
  • Give advice, information and opinion “fully, openly and objectively” to the Alliance Board and others in alliance generally; and
  • Establish an integrated alliance delivery team[17]

As such they have more detailed and specific obligations to work together than the woollier “good faith” obligations seen in other forms of NEC4 contracts.

An Alliance Board is also set up, with each member of the Alliance (including the Client) nominating someone to sit on it.[18] The Alliance Board is tasked with:

Setting the strategy for achieving the Alliance’s objectives and the partner objectives;

  • Agreeing the work within the Alliance;
  • Making decisions as stated in the contract;
  • Appointing and instructing the Alliance Manager;
  • Resolving any disputes between the Alliance[19]

The Alliance Board also has the power to alter the scope and add partners to the Alliance as required. If the Client’s Requirements are changed then that is a Compensation Event as would be expected. However, the Client is on the Alliance Board meaning their requirements can’t be changed without their agreement.

The Alliance Manager has a similar role to the project manager in a standard NEC contract save for in one crucial respect. This is, namely, that he or she is acting on behalf of the Alliance Board NOT the Client.

The Alliance Manager must act in accordance with instructions from the Alliance Board and also the Implementation Plan more generally.[20] The NEC Guidance Notes state that for major projects the Alliance Manager will no doubt have staff to assist them in carrying out their duties.[21] This is perhaps to be expected given that projects using alliancing tend to be higher value.

The Implementation Plan and the Programme

There are two key documents which govern the project as a whole. These are:

1. The Implementation Plan; and

2. The Programme.

The Implementation Plan sets out the management structure for the Alliance, roles and responsibilities, delegation by the Alliance Board, the use of common systems and processes[22] and (rather widely!) “any other information which the Alliance Board requires to be included” which is either in the documents referred to in the Contract Data or in an instruction.

The provisions in respect of the Programme, as you might expect for NEC contracts, require detailed provisions for float, time risks, health and safety requirements and procedures within the contract generally. Access dates, information deadlines and breakdowns of operations are also required.[23] If the Programme is set up properly (and updated regularly as per the intervals provided for in the Contract Data[24]) then it will obviously be a powerful project management tool.

Dispute Resolution Provisions

As discussed above, alliancing contracts do sometimes restrict the extent to which parties can engage the classic dispute resolution processes should problems arise. Unlike the FAC-1, which contains relatively standard dispute escalation provisions,[25] the NEC4 Alliancing Contract limits both what can constitute a “dispute” and also what methods of dispute resolution can be used to resolve them.

Clause 94 provides as follows:

“The members of the Alliance Agree that any failure by a member of the Alliance to comply with their obligations stated in these conditions of contract does not give rise to any enforceable right of obligation at law except for an event which is a Client’s or Partners’ liability. Any disputes between the members of the Alliance arising out of or in connection with the contract are only resolved in accordance with these conditions of contract.” [Emphasis added]

There are broadly speaking four categories of Client Liabilities. These are:

1. An intention act or omission to not comply with an obligation (e.g. wilful default);

2. A liability which the Client takes on from takeover (and the guidance notes make a point of emphasising that any liabilities for the Alliance are likely to be very small post-takeover and almost disappear after the Defects Certificate is issued);[26\]

3. Loss or damage to property owned and occupied by the Client;

4. Any other categories listed in the Contract Data.

The Partners’ liabilities are similarly limited and include (broadly speaking) wilful default, a breach of intellectual rights, death or bodily injury caused to an employee and any other liabilities stated in the Contract Data.[27]

As such, very real limitations are placed on what Alliance members can raise claims for.

In terms of Dispute Resolution options provided for, the main options are referring a dispute to an independent expert for “an opinion” (not a decision) and referring the dispute to Senior Representatives of each member of the Alliance. They in turn can decide to mediate. Adjudication is an additional option although there is a query as to how useful this would be to run given the limitations on what is a “dispute” in the first place. There is no provision for the resolution of disputes by court or arbitration.

It goes without saying that parties entering into the NEC4 Alliancing Contract need to be aware that their rights to seek redress if disputes arise are severely curtailed. They either need to take this on board or amend the dispute resolution provisions accordingly to amend the risk profile being taken on. Their insurance position also needs to be carefully considered.

Additional Options

As well as these core provisions, the Contract also gives options for early alliance involvement (a two- stage process) and Project Bank Accounts amongst others. 


The NEC4 Alliance Contract is a useful addition to standard form alliance contracts and benefits from the fact that NEC users will be familiar with its terminology. It also provides for a range of tools to ensure that collaboration can be integrated into the team from the offset. That said, as is ever the case with contracts aimed at integrating teams and fostering collaboration, it is essential that entrenched attitudes of “them and us” are tackled early on and the integrated team is educated as to how to use these tools effectively. This may take time and will undoubtedly require additional costs and investment to set up these processes at the beginning of the contract, which is why its use is likely to be confined to higher value and longer-term contracts.

Further, parties do need to take note of the dispute resolution provisions and the limitations placed on the ability to dispute certain types of claims. Whilst the reasoning behind these limitations is clear there is always a risk that these provisions are overlooked until such claims arise.

End Notes

1. See the introduction to the NEC4 Alliance Contract dated June 2018.

2. See Infrastructure Client Group, Improving Infrastructure Delivery: Alliancing Best Practice in Infrastructure Delivery, p. 5.

3. See Julian Bailey, Construction Law, vol. I, 2nd edn (Informa Law from Routledge), p. 39.

4. See Andrew Chew, “Some Practical and Legal Considerations when bidding and structuring alliancing projects”, Australian Construction Law Newsletter, #106 January/February 2006.

5. See the Infrastructure Client Group, “Preface”, in Improving Infrastructure Delivery: Alliancing Code of Practice (HM Treasury, 2015).

6. See Douglas D. Gransberg, Eric Scheepbouwer and Michel C. Loulakis, Alliance Contracting Evolving Alternative Project Delivery, ch. 2 (National Academies Press), for some detailed examples of alliancing as used in these countries as well as in the Netherlands.

7. The @One alliance web page notes that: “The Anglian Water @one Alliance will design and build around 800 schemes worth approximately £1.2 billion between April 2015 and March 2020, known as AMP6 – the current five year investment period, working closely with Anglian Water operations teams and other key stakeholders. We design and construct water and water recycling (waste water) treatment centres that serve more than six million people in the East of England (and Hartlepool Water) and maintain and improve the water mains and the sewerage network in the region.”

8. See Tom Fitzpatrick, “Rail Phase 2 Deal”, Construction News, 4 December 2015.

9. See Infrastructure Client Group, Improving Infrastructure Delivery: Alliancing Code of Practice (HM Treasury, 2015), p. 4.

10. See For further information see…

11. Association of Consultant Architects.

12. See

13. See “Framework Alliance Contract used on construction projects totalling £9.5 billion” posted on 11 August 2017 on the King’s College website.


15. Partnering contracts standard forms are more widespread and include PPC2000 and TPC2000. See also the JCT’s non-binding partnering charter and the JCT Constructing Excellence contract.

16. See “Managing an alliance contract”, NEC4 User Guide, vol. 4, June 2018, p. 1

17. See Clause 20.1 [The Alliance].

18. See Clause 21 [The Alliance Board].

19. See Clause 21.5 [The Alliance Board].

20. See Clause 22 [The Alliance Manager].

21. See “Managing an Alliance Contract”, NEC4, vol. 4, p. 20.

22. These may include: communication methods between partners, costs, procurement and tendering for subcontractors and suppliers, reporting, documents, resources, progressing monitoring and programme reports and risk (including risk registers). See “Preparing an Alliance Contract”, NEC4, vol. 2, p. 57.

23. See Clause 32 [The Programme].

24. See Clause 33 [Revising the Programme].

25. See Clause 15 of FAC-1.

26. See “Managing an Alliance Contract”, NEC4, vol. 4, section 80.1.

27. See Clause 81.1 [Partners; liabilities]

Obstructed view review

Written by Maria Cole Introduction In Wynyard Quarter Residents Association Incorporated v Auckland Council and Orams Group Limited,[1] a group of apartment owners filed judicial review proceedings seeking to overturn an Auckland Council decision to grant resource...

The losing streak is over: English rugby wins… right to bring claim against contractor

Written by Alexander Lyall Nearly 10 years on, English rugby finally has a victory related to the 2015 Rugby World Cup. In FM Conway Ltd v Rugby Football Union,[1] a company contracted by the English Rugby Football Union (the RFU) for maintenance works at Twickenham...

Keep calm and carry on: English Court of Appeal overturns controversial High Court ruling and clarifies guiding principles in serial adjudications

By Kate Holland The English High Court caused concern earlier this year when it held that an adjudicator had breached natural justice by holding himself bound by a previous adjudicator’s findings. Now, in Sudlows Ltd v Global Switch Estates 1 Limited,[1] the Court of...

Moving home

Written by Richard Pidgeon A family became dissatisfied with a house removal firm who had shifted their home from Remuera to Katikati. In Stott v Uplifting Homes Ltd [2023] NZHC 1514, the High Court determined the level of compensation after the contract was...

Big loss for insurer in legal battle with Napier Council over leaky building clause

Written by Sam Dorne In a recent case, the Supreme Court of New Zealand ruled in favour of the Napier City Council in an insurance claim involving building defects including weathertightness or “leaky building” issues, in what is seen as a return to the status quo...

BuildLaw Issue 51

September 2023Download PDF   CONTENTS BuildLaw in Brief Keep calm and carry on Mainzeal saga ends in the Supreme Court New Zealand: Insurance under Scrutiny Obstructed view review Case in Brief: Esk Valley marae injunction Res judicata and declarations relating...

Take a rain cheque – Full Federal Court of Australia reads common sense into insurance policy

By Alexander Lyall A decision by the Full Federal Court of Australia has provided clarification about the wording of an insurance policy for a construction project. In Acciona Infrastructure Australia Pty Ltd v Zurich Australian Insurance Limited [2023] FCAFC 47,[1] ...

Case update: English Court of Appeal confirms ‘useless’ ADR procedure too uncertain to enforce

By Kate Holland In our December 2022 issue of BuildLaw, we reported on a case in the English High Court[1] about an unusual alternative dispute resolution (ADR) procedure in a construction contract that was held to be too uncertain to be an enforceable condition...

English Court of Appeal confirms ‘useless’ ADR procedure too uncertain to enforce

By Kate Holland In our December 2022 issue of BuildLaw, we reported on a case in the English High Court[1] about an unusual alternative dispute resolution (ADR) procedure in a construction contract that was held to be too uncertain to be an enforceable condition...

Disgruntled builders lose defective cladding dispute

By Sam Dorne In Goodman-Jones v Hughey & ors [2023] NZHC 604, two experienced builders brought a claim for damages for a perceived defective installation of cladding for a new build. Despite the action being brought against multiple defendants the Court found that...

BuildLaw Issue 50

June 2023Download PDF   CONTENTS BuildLaw in Brief: Recent key developments in the construction industry Bad faith and without substantial merit – What it means and what it takes Disgruntled builders lose defective cladding dispute High-rise blues Build-to-Rent:...

Craftiness is not an abuse of process

With cashflow a persistent concern for companies in the construction industry, a recent decision in the New South Wales Supreme Court may alleviate some of the stress. The decision should affirm to struggling parties that there is no problem with taking strategic...

Privileged glimpses: Curtain falls on art gallery’s nuisance ‘human zoo’ exhibit

By Kate Holland The UK Supreme Court has ruled that the London Tate Modern’s public viewing gallery overlooking the luxury glass-walled apartments nearby, is a visual intrusion amounting to the tort of nuisance. The decision in has attracted criticism for prioritising...

Waiver and estoppel arguments raised in interim payment dispute

By Sam Dorne The English Court of Appeal case of A & V Building Solutions Limited v J & B Hopkins Limited has highlighted issues parties face when there is ambiguity in relation to dates for requesting interim payment in construction contracts.[1] The case...

Doing business in Australia? Then you need to know when you still might have to pick up the whole tab

By Maria Cole If you have a commercial contract in Australia, it’s probably governed by Australian law, which includes the proportionate liability regime.[1] Broadly, proportionate liability means if there are multiple parties to a contract and things go wrong, a...

Parliament passes sweeping amendments to construction payment regime

By Alexander Lyall Parliament has recently enacted legislation allowing for comprehensive changes to the Construction Contracts Act 2002. The Construction Contracts (Retention Money) Amendment Act 2023 passed its third reading on Wednesday 29 March and received Royal...

BuildLaw Issue 49

March 2023Download pdf   CONTENTS Diamond Glass slices damages in airport contract Case in Brief: Craftiness is not an abuse of process (Kennedy Civil Contracting Pty Ltd (Administrators Appointed) v Richard Crookes Construction Pty Ltd [2023] NSWSC 99) That...

Builder terminates contract with a “sorry mate…costs are going through the roof”

By Kate Holland With the construction industry in the grip of labour and supply shortages and spiralling costs, a recent decision of the Queensland court is a timely reminder of the established principles of contractual repudiation. The decision is a warning to...

Ripping up the Resource Management Act

By Adrian Sharma The Resource Management Act 1991 (RMA) is one of New Zealand’s most important pieces of legislation. It governs what can be built where, when, and how. But more than 30 years on from its introduction, and after numerous amendments, the controversial...

To bespoke or too bespoke – the case of an ADR clause that couldn’t be enforced

By Kate Holland In a recent English decision, the Technology and Construction Court held that a clause in a construction contract requiring the parties to refer a dispute to ADR was a condition precedent to commencing litigation in the courts. However, the Court also...

The Court of Appeal sounds the all clear and it’s business as usual under the CCA: so file a payment schedule or pay up!

By Maria Cole A decision issued by the High Court last year caused a “head in hands” moment in the construction industry in relation to the payment claim regime. The High Court set aside a statutory demand which had been filed to enforce a payment claim as a debt due...

BuildLaw Issue 48

December 2022Download pdf   CONTENTS The Court of Appeal sounds the all clear and it’s business as usual under the CCA: so issue a payment schedule or pay up! Case in Brief: Builder terminates contract with a “sorry mate… costs are going through the roof” but...

Labelling an image as an ‘artist impression’ was found not to give a developer artistic licence in a claim of misleading and deceptive conduct over an ‘off-the-plan’ premium apartment

By Maria Cole Australian consumer protection law was given an outing in the Federal Court of Australia when a developer merely added the words ‘artist impression’ to a computer generated image it intended to use in its marketing materials for an ‘off-the-plan’...

Fire risk – defective cladding litigation heats up

By Sam Dorne In England and Wales, the Technology and Construction Court in Martlet Homes Ltd v Mulalley & Co Ltd [2022] EWHC 1813 (TCC) (14 July 2022) has released the first decision arising out of a defective cladding dispute following the Grenfell Tower...

BuildLaw Issue 47

September 2022CONTENTS Competition not working well in residential building suppliesmarket Fire risk – defective cladding litigation heats up Case in Brief: Supreme Court of New South Wales finds forcemajeure clause offered no protection for loss and damage togoods in...

WA Supreme Court finds no implied licence to use home design plan

By Kate Holland In a recent Australian case, the WA Supreme Court was unwilling to interpret a contract between a home builder and their client to imply a licence allowing the client to use the builder’s design in whatever way they pleased. Although the case was...

Overhaul coming to the regulation of engineers

By Sam Dorne The Ministry of Business, Innovation and Employment (MBIE) undertook a consultation in 2021 to reform the regulatory regime for engineers. The reforms will move away from a voluntary accreditation scheme into a formal regulated regime.   Current...

Expert “evidence” needs to be more than just bald assertions to win the day

By Adrian Sharma Leakage issues in a building can be a real dampener. A recent decision of the Queensland Civil and Administrative Tribunal (the Tribunal) which considered conflicting expert evidence on water ingress issues in a newly built property highlighted the...

An adjudicator’s decision on a construction contract is definitely worth the paper it’s written on!

By Maria Cole It’s only in rare circumstances that the courts will interfere with the decision of an adjudicator on a construction contract. A recent decision out of the English Technology and Construction Court (TCC) considered arguments that an adjudicator acted in...

You break it you bought it: Supreme Court confirms you can’t cancel a contract for failure to satisfy a condition if your own behaviour had a material effect on the failure

By Belinda Green.   We’ve known for a long time that a party can’t rely on a failure to satisfy a condition if the condition failed to satisfy because of their action. But we never really had an explanation of how bad that “failure” had to be until now. In its...

BuildLaw Issue 46

March 2022CONTENTS You break it you bought it: Supreme Court confirms you can’t cancel a contract for failure to satisfy a condition if your own behaviour had a material effect on the failure Case in Brief: Unhelpful expert witness sees homeowners succeed in defective...

Vicarious liability and subcontractors

By Sam Dorne Liability in tort depends upon proof of a personal breach of duty, with one true exception, vicarious liability. The law of negligence is generally fault based; a defendant is personally liable only for the defendant’s own negligent acts and omissions....

Limitation for payment claims under construction contracts

By Sam Dorne The decision in Hirst v Dunbar [2022] EWHC 41 (TCC) considers the impact of payment provisions in a construction contract, whether through contract or implied terms, and the commencement of the limitation period for payment claims under the contract. It...

Extensions of time in construction contracts

By Jo O’Dea   In an extension of time claim, blame for the delay was a relevant consideration when assessing what was “fair and reasonable”.   In CAJ v CAI [2021] 5 GCA 102, the Singapore Court of Appeal considered the issue of extensions of time in...

BuildLaw Issue 45

March 2022CONTENTS Extensions of time in construction contracts Construction contract procedure and dispute resolution: There really is a reason to pay attention to the boring stuff Principals beware, constructive acceleration is here UK: Important announcement on the...

Testing the waters: New South Wales Supreme Court considers the prevention principle

By Hannah Aziz  Court provides further confirmation that the prevention principle can be excluded by the terms of a contract.   Introduction Following our recent commentary comparing the operation of the prevention principle in New South Wales and Victoria, the...

Construction contract or product warranty? Not all collateral warranty disputes can be adjudicated

By Belinda Green Collateral warranties might be parasitic on a construction contract, but that doesn’t automatically mean they are one. The individual wording and circumstances need to be considered. In some cases, like in Toppan Holdings Limited v Simply Construction...

When you think the amount of your personal guarantee had a limit – but it didn’t.

In a recent Court of Appeal case, Cancian v Carters [2021] NZCA 397, Carters sought to enforce a personal guarantee against Mr Canican.  The Court dismissed an argument from Mr Cancian that Carters had not notified him that that the limit on his personal guarantee had...

BuildLaw Issue 44

December 2021CONTENTS Testing the waters: New South Wales Supreme Court considers the prevention principle Adjudication enforcement by companies in liquidation: Court of Appeal raises fundamental objections Wilful breaches of contract – Do exclusion clauses and...

Leaky Home Case: Failure to obtain a building report results in reduction of damages for contributory negligence

By Melt Strydom. Apportionment for contributory negligence allows a court to share the responsibility between parties in circumstances where the test for causation and remoteness of damage justifies it. It doesn’t mean a respondent will not be held liable for...

Do payment claims for retention money ‘fit’ with the standard terms of contract in New Zealand?

By Maria Cole The New Zealand Construction Contracts Act 2002 (CCA) does not explicitly state that payment claims can be used to recover retention money. That said, it is clear the 2015 amendments to the definition of a ‘payment’ under the CCA are broad enough to...

Resolving Construction Disputes – Is Adjudication a Good Option?

By Natalia Vila.   With few exceptions, the Construction Contracts Act 2002 (the Act) applies to every construction contract relating to construction work carried out in New Zealand. Statutory adjudication under the Act is the most commonly used dispute...

BuildLaw Issue 43

September 2021CONTENTS Construction contracts: enforcement of debts due and mandatory alternative dispute resolution clauses Cost certainty for resolving building and construction disputes: extension to the BDT Adjudication Low Value Claim scheme Engineers’ corner:...

Cost certainty for resolving building and construction disputes: Extension to the BDT Adjudication Low Value Claim Scheme

By Belinda Green.   One of the main barriers to dispute resolution is cost: no one wants to risk spending more than the amount they recover. With inflation and construction costs always on the rise, BDT is extending its Low Value Claim (LVC) Scheme for...

Construction Contracts – Enforcement of Debts Due and Mandatory Alternative Dispute Resolution Clauses

By Melissa Perkin. The recent High Court decision in Hellaby Resources Services Limited v Body Corporate 197281 [2021] NZHC 554 is of particular interest in the construction sector for several key reasons: it is a rare example where a stay of enforcement of summary...

The Enforceability of Liquidated Damages Clauses

Author: Melissa Perkin  Liquidated damages clauses, a common feature of construction contracts, stipulate the amount of money payable as damages for loss caused by a breach of contract, irrespective of the actual loss suffered. A recent United Kingdom decision of the...

Building and Construction Under COVID-19 Alert Level 4

For information and guidance on what building and construction work can be done at Alert Level 4: ·       Health and Safety protocols at different alert levels, visit CHASNZ COVID-19 and working at the current alert level (; and ·       COVID-19 guidance...

Class-action lawsuit against Harditex cladding fails

By Melissa Perkin.  A second class-action lawsuit[1] brought by a group of 144 homeowners whose homes were clad in Harditex fibre-cement cladding, has failed. The homeowners alleged that Harditex manufacturer James Hardie, between 1987 – 2005, knowingly sold defective...

What types of disputes can be referred to adjudication?

The types of dispute that can be referred to adjudication are listed below:  Default liability claim These are claims for technical non-compliance with the payment regime under the Act. Where a valid payment claim has been served by a payee on a payer and the payer...

Important Guidance on Contract Interpretation Issued by the Supreme Court

Bathurst Resources Ltd v L & M Coal Holdings Ltd [2021] NZSC 85 The Supreme Court in Bathurst Resources Ltd v L & M Coal Holdings Ltd [2021] NZSC 85 has provided important guidance on how extrinsic evidence and implied terms are used to aid interpretation of...
Skip to content