FAVOURED FORUM: DISPUTE RESOLUTION IN THE UK CONSTRUCTION INDUSTRY
The construction industry, like so many others, has had a torrid time in recent years due to coronavirus (COVID-19). Disruption has resulted in a multitude of delays, cost overruns and cancellations.
Across the globe, the pandemic has severely impacted the industry’s status quo. Many international construction projects were impacted by a range of COVID-19-related matters, including government-imposed lockdowns, workforce shortages (including a reduction in migrant workers), travel restrictions, pandemic-related health and safety requirements, border closures and export restrictions.
In the UK, the impact of the pandemic has been no less severe. “Unexpected events have always impacted construction projects, compounding the potential for full-scale disputes, but COVID-19 has had the single greatest effect over the last 18 months,” says Adrian Bell, a partner at Cameron McKenna Nabarro Olswang LLP. “It has inevitably resulted in a lot of pain for the UK construction industry in terms of delayed and disrupted projects, increased project costs and numerous insolvencies.”
For Martin Burns, head of alternative dispute resolution (ADR) research and development at the Royal Institution of Chartered Surveyors (RICS), the construction world of pre-2020 has gone, perhaps forever. “Many projects were halted, some permanently, sites shut down and employees have been absent or laid off,” he laments. “Cash flow, a perennial problem, has become a deepening crisis. The signs are that things are likely to improve, but the effects of COVID-19 will be with us for months, even years, ahead.”
According to Osborne Clarke, despite optimism for recovery, historic claims and disputes arising from almost two years of challenging working conditions means the UK construction industry is likely to see a rise in the number of claims that turn into formal disputes.
Jan-Mar 2022 issue
Fraser Tennant