Construction Law: Analysis of Contractual Issues Report

This report analyzes a construction law case involving Pig’s Ear Edifice LLP and Artless Enterprises Ltd. The report examines the contractual obligations and legal responsibilities of both parties under the JCT Standard Building Contract 2016. It addresses issues related to discrepancies in contract documentation, the lack of a professional architect/contract administrator, and the consequences of inadequate designs, specifically focusing on a dangerous roof truss, a disabled ramp, and a fire escape. The report explores the actions Pig’s Ear should take when encountering errors and inadequacies in the designs provided, and the steps Artless can take during the rectification period. The analysis considers the legal and contractual liabilities of each party, emphasizing the importance of communication, adherence to contract terms, and the implications of design flaws. The report concludes with a summary of the findings, highlighting the key responsibilities of the contractor and employer and the remedies available in case of errors or defects.

Running head CONSTRUCTION LAW
CONSTRUCTION LAW
Name of student-
Name of University-
Author Note-

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Table of Contents
PART A......................................................................................................................................2
Answer 1................................................................................................................................2
Issue:..................................................................................................................................2
Relevant Rule:....................................................................................................................2
Application:........................................................................................................................3
Conclusion:........................................................................................................................4
Answer 2................................................................................................................................4
Issue:..................................................................................................................................4
Relevant rule:.....................................................................................................................4
Application:........................................................................................................................5
Conclusion:........................................................................................................................6
Answer 3................................................................................................................................6
Issue:..................................................................................................................................6
Relevant Rule:....................................................................................................................6
Application:........................................................................................................................7
Conclusion:........................................................................................................................8
Part B..........................................................................................................................................9
References:...............................................................................................................................16

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PART A
Answer 1
Issue:
In the given case, the issue is regarding the steps/actions/procedurals which Pig’s Ear
Edifice LLP (Pig’s Ear) is ought to take for the divergences and discrepancies in the contract
documentation, presented by Artless Enterprises Ltd. (Artless) for the construction and the
contractual and legal position of Artless in relation to its failure to appoint a professional
architect or contract administrator.
Relevant Rule:
According to the JCT Standard Building Contract with Quantities 2016, vide clause-
2.15, it clearly states that when there is any divergences or discrepancies in – 1) contract
drawings 2) Contract Bills 3) any instruction or conditions issued by the architect/contract
administrator 4) any documents or drawings issued by the architect/contract administrator 5)
other contractor design documents or if there is any error, omission, inadequacy or departure,
mentioned in clause- 2.14, then it is the duty of the contractor to immediately issue a notice to
the contract administrator/architect and the contract administrator/architect shall give
instructions accordingly in such cases1. On the other hand according to where the employer
fails to appoint a professional architect or contract administrator, it is the responsibility of the
employer for any problem that occurs2. Contractually and legally the employer becomes
responsible for a mistake on his part as it is a duty of the employer to appoint a professional
contract administrator/architect.
1 Burr, Andrew, ed. Delay and disruption in construction contracts. CRC Press, 2016.
2 Chappell, David. Understanding JCT standard building contracts. Routledge, 2017.

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Application:
In the given case, Artless Enterprises ltd, a construction company, decides to expand
its business by building prestigious projects. Hence, it decides to build a student’s hall
residence for the students studying in Nottingham and also with a vision that one of the
universities in Nottingham will buy it in future. Artless, therefore, appointed Pig’s Ear
Edifice LLP, Builders, for the construction of the hall. Both companies were in experienced
in this type of project. After the foundation and basic structural construction was done, Pig’s
Ear found out that the contract documents, mainly the drawing, that Artless provided, were
erroneous. In this case it becomes the duty of pig’s Ear to inform the contractual
administrator or the architect of the contract drawing immediately and rectifications should
be made by the architect accordingly, because the provisions of the JCT Standard Building
Contract with Quantities 2016 edition states so in such situations and Pig’s Ear works in
accordance with the JCT Standard Building Contract with Quantities 2016 edition. On the
other hand, Pig’s Ear’s managing partner was in doubt whether Artless appointed a
professional architect/contract administrator after he saw the errors. In this case the liability
for any mistake, based on the drawings of the architect, falls on the Employer of the architect,
that is, Artless as according to the JCT Standard Building Contract with Quantities 2016
edition, it is the duty of the employer to appoint a professional architect/contract
administrator. Legally, Artless is legal responsibility for anything wrong and contractually,
both the contracts, that is, between Artless and the architect and Artless and Pig’s Ear will get
affected3. The architect is contractually liable to provide the assigned work to Artless with
expected professional skills and is responsible for any work below such expected level. On
the other hand, Artless is liable to provide with proper documents to Pig’s Ear and it is also
3 Adriaanse, Mr John. Construction contract law. Palgrave Macmillan, 2016.

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its duty to ensure that the documents are made by using proper professional skills. Hence,
both the contracts will get affected.
Conclusion:
Therefore, from the above discussion it can be concluded that Pig’s Ear is has an
obligation to inform about the errors in the contract drawing according to the JCT Standard
Building Contract with Quantities 2016 edition and Artless will become both legally and
contractually liable for not appointing a professional architect/contract administrator. It is so
because there are two contracts existing, that is between Artless and the architect/contract
administrator and between Artless and Pig’s Ear. Therefore, as to the legal and contractual
status of Artless is in one hand it is entitled to a claim for erroneous work from the architect
and Artless is liable for the erroneous designs provided to Pig’s Ear on the other hand.
Answer 2
Issue:
In the given case, the issue is whether there are any actions or procedurals or steps,
which Pig’s Ear could take for warning Artless for the inadequate and potentially dangerous
roof trusses given in the construction deigns provided by Artless to Pig’s Ear along with the
contract document for construction of the student’s hall residence4.
Relevant rule:
According to the JCT Standard Building Contract 2016 edition and according to the
common law of Construction, it is the duty of a contractor to inform the employer, if he finds
any errors in the documents. If the contract documents provided by the employer are
4 Thomas, Reginald William, and Mark Wright. Construction contract claims. Palgrave Macmillan, 2016.

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erroneous, then it does not make the contract invalid and the errors must be rectified
accordingly. But the contractor is not entitled for any additional sum of money for such
rectification. The liability or the obligations of the contractor does not end once the
construction is handed over to the employer. After the construction is over, the employer
hands a certificate of completion to the contractor5. However, the liability of the contractor
still remains for a certain period, in which, if any defect in the construction is found, the
contractor is liable to rectify it without any additional money6. The period in which this has to
be done is known as the rectification period.
Application:
In this case, the managing partner of Pig’s Ear found that Artless provided a design
for a roof tussle in the contract documents, which was erroneous. The design was made in
such a way by the architect that it would turn out to be potentially dangerous and inadequate
in the future. According to the construction law and the common law there is a step which
Pig’s Ear must take in this regard. Pig’s Ear, being the contractor must take necessary actions
to inform the employer, that is, Artless about the potentially dangerous and inadequate design
of the roof tussle, provide by Artless. According to the common law of construction, it is
mandatory for the contractor to inform the employer about any erroneous documents
provided by the employer to the contractor. Not only the common law, but the JCT Standard
Building Contract 2016 edition vide clause- 2.14 states the same and in addition states that if
any error or inadequacy is found in any design provided by the employer, and the contractor
is not responsible for verification under clause – 2.13.2, then if the error is not dealt with to
the extent in accordance with the requirements of the employer, the employer’s requirements
5 Hughes, Will, Ronan Champion, and John Murdoch. Construction contracts: law and management.
Routledge, 2015.
6 Llewellyn, Karl N. The common law tradition: Deciding appeals. Vol. 16. Quid Pro Books, 2016.

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shall be altered or modified7. The JCT, 2016 also states that the error or inadequacy in a
contract document will not vitiate the contract and it shall be rectified accordingly, without
any additional payment to the contractor for such rectification8.
Conclusion:
Therefore, in this case and according to the above discussion, it is clear that Pig’s Ear
should take a step for the inadequate and erroneous design of the roof tussle. It should inform
Artless about such error and inadequacy and warn artless as the JCT Standard Building
Contract, 2016 edition and the common law of construction states so. But Pig’s ear cannot
cancel the contract but needs to rectify the error and inadequacy after informing Artless about
it and for such rectification, Pig’s Ear cannot charge any additional payment of sum, as the
both the common law and the JCT, 2016 prohibits it.
Answer 3
Issue:
In the given case, the issue is whether the employer, that is, Artless is competent to
take any action or step during the rectification period of Pig’s Ear to put right the disabled
ramp and the fire escape, which it failed to construct in accordance with the designs provided
to build it9.
Relevant Rule:
According to the JCT Standard Building Contract, 2016 edition, when there has been
an error or defect made by the contractor, in the constructions, it is the duty of the contractor
7 Ndekugri, Issaka, and Michael Rycroft. The JCT 05 Standard Building Contract. Routledge, 2012.
8 Turner, Dennis F. Design and build contract practice. Routledge, 2014.
9 Chappell, David. Understanding JCT standard building contracts. Routledge, 2017.

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to inform the employer about such errors and inadequate construction. The time period of
rectification is called the rectification period and it is generally between 6 to 12 months. The
employer needs to inform the contractor about the defects with in this period and the defects
must be rectified without any additional money. Not only JCT Standard Building Contract
states so, but also the common law states the same10. The JCT Standards also states clearly
that after the work is completed, a certificate of completion is issued and after such
certification, if any defects are discovered, then it must be rectified within the rectification
period, which begins after the certification, when any defects are found. The certificate of
completion is usually issued before the commencement of the rectification period. In case
there is any defect found before the date of completion or the commencement of the
rectification period, then the defects must be rectified by the contractor immediately and in
such cases the certificate of completion can be withheld until the defects are rectified.
Application:
In the given case, Artless provided Pig’s Ear with all the contract documents,
including the contract designs. All the important designs for construction were provided
including the designs for the roof trusses, which was potentially dangerous and inadequate.
That is, it was erroneous in the provided design and it was the fault of the architect who had
designed it. Apart from this, designs for an exterior ramp and a fire escape, was provided by
Artless. The exterior ramp which Pig’s ear had built was terrifyingly vertiginous and narrow.
The ramp was a disabled one, as the ramp was built till the halfway up a stairway, leaving
five UN ramped stairs soaring above the end of the ramp. The local people soon started to
refer the disabled ramp as K2. There was also a design provided by Artless to Pig’s Ear to
build a fire escape stairway which was built by Pig’s Ear erroneously. The fire escape
stairway was built in such a way that ends in mid-air, halfway up an external gable wall in the
10 Ndekugri, Issaka E. "Late disputes and the NEC3 Engineering and Construction Contract." Proceedings of the
ICE-Management, Procurement and Law (2016).

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supposedly completed halls of residence. The fire escape ends at a landing suspended several
meters up the gable wall with no stairs to connect the landing to the ground. This erroneous
construction was focused on by the media and the images of the site went viral on the
internet. It was stated by the director of Artless that the designs provided to Pig’s Ear for the
construction of the fire escape and the ramp was not erroneous and was very much workable,
viable and complete and the way Pig’s Ear had built it was not in accordance with the
contract designs, given along with the other contract documents. In this case, as the
provisions of JCT Standard building Contract will apply. As the law says that when the
contractor makes an erroneous construction, the contractor is liable for such errors and it is
the duty of the employer to send a notice to the contractor for rectification of such errors
made without any additional cost. In this case, the employer, that is, Artless, after discovering
the defects in construction, must send a notice of the same to Pig’s Ear and ask them to
rectify the errors. This notice must be sent immediately after the defects are discovered.
Artless must send a notice for reconstruction. Pig’s Ear is bound to make such rectification by
reconstruction and they are not entitled to get any additional payment for such
reconstruction11. If such rectification is refused or any additional payment for rectification is
asked by Pig’s Ear then Artless has the right to sue Pig’s Ear for breach of contract and in this
case Artless can withhold the certificate of completion as well, as the defects were discovered
before the date of completion.
Conclusion:
Therefore, from the above discussion it is clear that the JCT Standard Building
Contract, 2016 Edition and the common law states the similar rules for construction law
regarding the steps the employer should take or the duties of the employer in case any
11 Hamid, ABDUL RAHIM ABDUL, D. M. C. Botiti, and SAEED REZA Mohandes. "Managing the Delayed
Completion on Construction Project." Journal of Advanced Research in Business and Management Studies 1.1
(2015): 14-24.

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erroneous construction by the contractor. Therefore, in accordance with the law, Artless,
being the employer must send a notice to Pig’s Ear within the specified time provided by the
law and Pig’s Ear is responsible for the rectification of the erroneous construction. In the
given case as the design provide by Artless was not erroneous and the construction made by
Pig’s Ear was not in accordance with the designs provided, Pig’s Ear is liable for the error
and the action that Artless should take up, is to send a proper notice of rectification to Pig’s
Ear, withhold the certificate of completion as the defects were discovered before the date of
completion and can take legal actions in case Pig’s Ear refuses to rectify.
Part B
The JCT Standard Building Contract with Quantities, 2016 Edition sets the standards
of building contracts and deals in details with the rules and regulations that govern the
building contracts. It includes the various types of building contracts. It includes the functions
of Contractors, Employers, Sub-Contractors, principal designers, contract administrators,
quantity and their duties and obligations12. The JCT also gives a detailed set of rules
regarding the contract sum and its payments under different circumstances13. In a construction
contract many disputes can arise anytime. The JCT, therefore includes provisions for solving
these disputes by using different legal solutions like arbitration, adjudication and legal
proceedings14. As the JCT focuses on the aspects of the building contracts, it attracts and
includes certain provisions of the Contract Law as well. Similar to the Contract law under the
common law, the JCT, 2016 also includes and mandates that the basic requirements of
12 Adriaanse, Mr John. Construction contract law. Palgrave Macmillan, 2016.
13 Brook, Martin. Estimating and tendering for construction work. Taylor & Francis, 2016.
14 Chern, Cyril. The Law of Construction Disputes. CRC Press, 2016.

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contract in case of building contracts in the same way. Apart from these, the JCT also
provides various rules regarding matters like supply of materials and documents, third party
rights, rules for errors, discrepancies and divergences, termination of contract by employers
and contractors, payment related rules and calculations, provisions related to injury, damage
and insurance and also about the dispute settlement methods to solve the disputes of building
contracts15.
The JCT mainly stresses on the rights and obligations of the employer and the
contractors. According to JCT, there are different types of building contracts and the payment
obligation of the employer is based on the type of building contract the employer and the
contractor enters into. The types of building contracts on which the payments of the
employers vary are- Firstly, the Lump sum contract, in which the employer pays a big sum
of money to the contractor after the completion of the work and no cost break down is
required in this method16. Secondly, in the Lump sum and scheduled contract the employer
has to make the payment after the completion of the work but in this case cost break down is
required17. Thirdly, in case of a cost plus fixed free contract the employer has to pay the
contractor a certain amount which is over and above the documented cost and such amount
shall be fixed and agreed amount18. Fourthly, in cost plus percentage of cost contracts, the
employer has to pay more than 100 percent of the documented cost but it requires a detailed
accounting of the expenses19. Therefore, the amount of sum to be paid by the employer to the
15 Atkinson, Andrew R., and Christopher J. Wright. "Containing the Cost of Complex Adjudications." Journal of
Legal Affairs and Dispute Resolution in Engineering and Construction 7.1 (2014): A4514002.
16 Potts, Keith, and Nii Ankrah. Construction cost management: learning from case studies. Routledge, 2014.
17 Hetland, P. W. "Exploring the value of project complexity—beyond lump sum contracting." Managing Risks
in Projects(2013): 149.
18 Dorey, Sean P., Josef Oehmen, and Ricardo Valerdi. Enhancing cost realism through risk-driven contracting:
Designing incentive fees based on probabilistic cost estimates. DEFENSE ACQUISITION UNIV FT
BELVOIR VA, 2012.
19 Meng, Xianhai, and Brendan Gallagher. "The impact of incentive mechanisms on project
performance." International Journal of Project Management 30.3 (2012): 352-362.

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contractor depends on the above mentioned types of building contracts. Lastly, there is
another type of building contract that is known as a special contract20. Special contracts can
be classified into- Firstly, Turn-key contract, in which a contractor completes his work and
hands it over to the employer or the client in full operational form and the employer or the
client just needs to “turn” a “key” to bring the work in motion21. Secondly, Negotiated
contract, is another special contract in which the employer directly negotiates with the
contractor on an agreed sum of money without any bidding process22. It is also known as a
negotiated agreement. Thirdly, there is the package contract in which the contractor,
designs, finances, specify, commission and construct the project entirely23. Fourthly, there is
the continuing contract which is attributed with periodic performances and the performance
is divided in different units over a particular time period24. Lastly, running contract is
another special contract, in which an approximate quantity of stores is supplied at a specified
price during a certain period25. These special contracts also affect the payment which is to be
paid by the employer to the contractor. The JCT, by its clause, 25 provides for extension of
the date of completion of the contract. In cases of most of the contracts, the time period for its
completion is usually extended. The extension takes place on the occurrence of certain
situations, which the JCT provides. It can happen that a contractor may fail to finish his work
with in the stipulated time, which may be provided in the contract due to certain
uncontrollable circumstances for which the employer can claim liquidated damages from the
20 Harris, Frank, and Ronald McCaffer. Modern construction management. John Wiley & Sons, 2013.
21 De Marco, Alberto, and Timur Narbaev. "Earned value-based performance monitoring of facility construction
projects." Journal of facilities Management 11.1 (2013): 69-80.
22 Schaufelberger, John E., and Len Holm. Management of construction projects: a constructor's perspective.
Taylor & Francis, 2017.
23 Brook, Martin. Estimating and tendering for construction work. Taylor & Francis, 2016.
24 Furst, Stephen, et al. Keating on construction contracts. Sweet & Maxwell, 2012.
25 Nowotarski, Piotr, and Jerzy Paslawski. "Barriers in running construction SME–case study on introduction of
agile methodology to electrical subcontractor." Procedia Engineering 122 (2015): 47-56.