Lorna Carter

+44 (0)1223 785299 lecarter@greenwoodsgrm.co.uk

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Why are construction documents important?

Construction / 16 March 2021

Our Construction team is led by partner, Lorna Carter. Lorna specialises is both construction dispute resolution and the drafting of documents for construction works. In particular, we work with a variety of education providers, from schools and academies to universities and colleges and independent schools advising about their construction-related issues.

Construction issues for education providers to be aware of include:

  • Advising on your own set of construction documents for any projects/works instructed by you;
  • If works/projects are being procured by others, protecting your contractual position; and
  • Understanding your repairing obligations.

The parties directly involved in a construction project will usually enter into written contracts outlining the extent of the parties’ duties and responsibilities to one another. However, there are also often third parties who have an interest in the project but are not a party to them, for example external funders. In this scenario, collateral warranties and third-party rights can be helpful.

What is a collateral warranty?

A collateral warranty is a contract under which a professional consultant (such as an architect or quantity surveyor), a building contractor or sub-contractor warrants to a third party (such as a funder or tenant) that it has complied with its professional appointment, building contract or sub-contract. The collateral warranty creates a contractual link where none had previously existed and gives those interested third parties a right to bring a contractual claim against the parties that designed or built the project. Without that protection any losses suffered by the third party would most likely be irrecoverable against the building contractor, professional or sub-contractor.

What is a third party right?

A third party is the right of a person who is not a party to the contract to enforce the benefit of a term of that contract, for example: enforcing a term of a professional appointment entered into between an employer and architect or a building contract entered into between the employer and its contractor. It is important for the benefit of the third party right to assigned in the right way.  The third party right operates in the same way tas a collateral warranty to aim to provide protection against losses that might otherwise be irrecoverable.

Collateral warranties and third-party rights are an important way to provide construction security and can be a useful tool for education providers, particularly for example academy trust tenants who are interested in works between local authorities and contractors/sub-contractors.

If you need help negotiating construction documents and/or enforcing your rights as a third party, please do get in touch with our highly experienced Construction team.

 

 

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This update is for general purposes and guidance only and does not constitute legal or professional advice. You should seek legal advice before relying on its content. For advice, get in touch with your usual Greenwoods GRM contact or scroll down to complete our enquiry form.

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