Construction Law/Payment Dates

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Question
Hi John,

A contract we are in with a main contractor has ran past the contract date by several months through no fault of our own. The due dates and payment dates where clearly stated in the contract up to and including July, however the final valuation was done in September.

Am i correct to say that as the due dates and payment dates were the same couple of days each month, I could reasonably expect that a precedent had been set and that the due dates and payment dates for August onwards would be the same?

Answer
Dear Neil,

Thank you for this question.

Although the date for completion has passed the obligations on both Parties will continue until complete. Most construction contracts set out a mechanism by which payment will be operated, and under English law dates for payment need to be certain. If the dates were established for the period before the original completion date by using the contract mechanism then you can assume safely that the like dates will apply each month for the period after the original completion date.

If the dates were originally set by agreement and the contract does not have a mechanism then the prior practice will certainly be of significance if the Parties do not agree expressly; however, the default position is that the payment scheme found in the Housing Grants, Construction and Regeneration Act (the Construction Act) as amended by Part 8 of the Local Democracy, Economic Development and Construction Act and the Scheme for Construction Contracts (England and Wales) Regulations will apply.

The Scheme for Construction Contracts (England and Wales) Regulations (the Scheme) provides, amongst other things, that the payment provisions of the contract that are in compliance with the Construction Act will continue to take effect and any missing payment provisions or non-complaint provisions will be implied into the contract by the Scheme.

If you are not aware of the provisions of the Construction Act (as amended) or the Scheme, I will be happy to provide further guidance.


I hope that this assists you.

Kind regards,
John Dowse

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John Dowse

Expertise

Legal; contract interpretation; quantum; delay analysis. Practitioner in arbitration, adjudication and mediation.

Experience

Thirty-three (33) years experience in building and construction, at all levels both within contracting and consulting organisations. Practising arbitrator, adjudicator, and mediator. Faculty approved trainer for the Chartered Institute of Arbitrators. Lecturer on construction contract forms and dispute resolution practices.

Organizations
Chartered Institution of Civil Engineering Surveyors Chartered Institute of Arbitrators Institute of Directors Society of Construction Arbitrators

Publications
Various UK and International construction and legal publications.

Education/Credentials
LLB (Hons), Pg Dip (Legal Practice), MCInstCES MCIArb MIOD Barrister

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