Related Services under the Construction Contracts Act 2002

The definition of construction work under section 6 of the Construction Contracts Act 2002 has, with effect from 1 September 2016, been extended to include related services, which are defined in the new subsection (1A) as including:

(1A)   construction work includes –

(a)    design or engineering work carried out in New Zealand in respect of work of the kind referred to in subsection (1)(a) to (d) and (f):

(b)    quantity surveying work carried out in New Zealand in respect of work of the kind referred to in subsection (1)(a) to (g)

For architects, engineers and quantity surveyors, the protections for progress payments under the Act now apply.  Similarly, the provisions relating to adjudicating disputes under their appointment agreements also apply.


LawTalk article – Construction Contracts Amendment Act 2015

A revised version of my article on the Construction Contracts Amendment Act 2015 has been published in the 2 June 2016 edition of Law Talk, the New Zealand Law Society’s magazine.

To read the article online, click here.


Securing Positive Project Outcomes using NEC3

The NEC3 suite of contracts is growing in use in New Zealand.  The contracts were used with apparent success for the development of the stadium and other facilities for the London Olympics in 2012, and it is the preferred form of contract by the Office of Government Commerce for all public private partnerships in the UK.

In NZ, the engineering and construction contract was used for the development of the Northland Events Centre for the Rugby World Cup in 2011.  At $16.5 million, the development was more modest that some others, but it was on time, within budget, and effective.

This paper was prepared for the NEC Users’ Group Australasia conference in Christchurch on 27 August 2013.


Certifying payments under the Construction Contracts Act 2002

Two years after the Construction Contracts Act came into force, I looked at how the payment provisions of the Act were being enforced.

This article was published in the INstitute of Architects journal, Cross Section, following the Court of Appeal decision in George Developments v Canam Construction, which remains the leading case on certification of payments.


Architects’ terms of appointment

When preparing the design consultancy agreement for the development of the new Hong Kong airport terminal some years ago, I was severely done over by the design consortium’s contract representative (a large, heavily perfumed engineer with a penchant for loud stripy suits and pocket handkerchiefs).  He was a force to be reckoned with.

He lead me through my drafting, page by page angrily pointing out split infinitives (I looked blank) and other transgressions.  His coupe de grace was that I was presenting them with a contract, like some nasty commercial arrangement, and not an agreement which gentlemen and trusted friends would enter into.  I felt times had changed, but did not have the courage to enlighten the formidable gentleman.


Architects’ appointments

Architects’ responsibilities, whether as set by the Institute of Architects, or imposed by the law, fall into three distinct categories:

  • As designer, the architect is specialist.  The designs are used for consenting, costing and contracting.  Any design error is covered by professional indemnity insurance.
  • As supervisor, the architect monitors performance under the contract and issues instructions and variations and approves costs.
  • As the first stage in the disputes process, the architect is the independent professional.

The relationships arising from these roles will often give rise to unmanageable conflicts of interest.  While balancing acting as the owner’s agent, the architect must protect the integrity of the design and keep in context relationships with contractors and subcontractors, with whom there is probably a longer term relationship, if not stronger, than with the owner.


Architects’ liability to owners

In two English cases, the High Court and the Court of Appeal had reason to consider the relationship between architects and property owners in tort and in negligence.

Tesco Stores Ltd v Costain Construction Ltd & Ors [2003] EWHC 1487

Sahib Foods Ltd & Anor v Paskin Kyriakides Sands [2003] EWCA Civ 1832

This article was published in the NZIA journal, Cross Section


Architect’s ownership of their designs

It has long been established at law that the physical plans and drawings prepared by architects on behalf of clients are, unless the parties agree otherwise, the property of the client on payment.  Where architects need to be careful is to ensure that their terms of appointment properly protect them.