JULY 1998 - 1
THE SCHEME FOR CONSTRUCTION CONTRACTS REGULATIONS 1998
NOW IN FORCE!
These Regulations came into force on 1st May 1998 and apply to most types of contract or agreement. With few exceptions, it affects everyone who procures or provides "building work".
The Regulations define contracts for "building work" widely as almost any agreement relating to the procurement of almost any building-related works (including sub-contracts and agreements with architects, engineers etc. to provide design services).
They impose special new terms covering entitlement to regular payments and resolution of disputes. You cannot contract out of these provisions.
It can affect the smallest scale work (e.g. maintenance and repairs) and work of almost every type (e.g. bar-fitting, shop-fitting, roof repairs, internal alterations, painting and decorating, drainage repairs etc. and new buildings of every size and type).
The principal effects of the Regulations are:
- Anyone providing building work is entitled to regular payment regardless of the payer’s entitlement to receive money from another party.
- If any dispute arises between the parties (e.g. regarding the amount or date of money due or the quality of the work done) an entirely new, quick (28 days) "adjudication" procedure can be invoked by either side to obtain an independent decision.
- The result of any "adjudication" is legally binding and enforceable (until the eventual outcome of any subsequent arbitration or litigation - perhaps many years later).
- Any contract entered into after 1st May 1998 has these terms implied if they have not already been agreed between the parties.
Knowing how problems can be resolved and how to go about it can save both time and money, especially if you take advice at an early stage.