Article Business Practice Data Management

New Construction Industry Scheme

28th May 2007 - by Ann-Marie Casserly

Tags: CIS HMRC subcontractor tax

On 6 April 2007 a new Construction Industry Scheme came into force. Though altered, the new CIS involves the same basic concept as the old scheme, whereby a contractor has to make deductions under certain circumstances when making payment to a subcontractor for construction work.

The old system of tax certificates has been abolished, and in its place a new system has been introduced whereby all subcontractors requiring payment for construction work have to be registered with HM Revenue and Customs (HMRC). Subcontractors who previously qualified for a tax exemption certificate will be registered for gross payment. Others will be registered for payment under deduction, at a level of 20%. If a subcontractor is not registered deduction is at a level of 30%.

On engagement by a contractor the subcontractor will have to provide identity details, which the contractor will check with HMRC. HMRC will confirm if payment is to be made gross or after deduction. The subcontractor’s status must be checked before the first payment is made. The contractor can assume the status has not changed for the present tax year and for the following two tax years, unless notified otherwise by HMRC.

Contractors have to submit monthly returns to HMRC detailing all payments made under the Scheme. A declaration also has to be made on the return confirming that none of the payments is in respect of a contract of employment. The contractor has therefore to satisfy himself that a relationship with any subcontractor is not one of employment.

An area of concern has been that Consultants could become drawn into the CIS net under the new Scheme. Advice received from the HMRC helpline is that site investigations procured directly by a Consultant during the planning stage of a project (i.e. before any “construction operations” (as defined under the CIS) commence would not be covered by the CIS, as they would not be regarded as “construction operations” under the CIS. However site investigations carried out once “construction operations” had commenced would not be so exempt.

Further details can be found at the HMRC website – see http://www.hmrc.gov.uk/new-cis/index.htm

Nigel King

Halcrow

Article Data Management

Update on the Freedom of Information Act 2000

28th May 2007 - by Ann-Marie Casserly

Tags: Information

Extract from the ACE Briefing Note – 19^th August 2005 “Update on the Freedom of Information Act 2000”

Introduction

On 19 August 2005 the Association for Consultancy and Engineering produced an update on their earlier Briefing Note on the Freedom of Information Act 2000 (“the Act”) which explained the key features of the Act, what the Act would mean for consultants and the exemptions that are likely to be the most relevant. It indicated how the Act has been (and could be) used by businesses, particularly competitors, and alerted consultants on steps they should consider taking in order to reduce the likelihood of their commercially sensitive and/ or confidential information being disclosed to competitors.

By the way of a brief reminder the act came into force on 1 January 2005 and provides a general right of access to anyone, anywhere in the world, to request information held by or on behalf of any Public Authority (“PA”), in the UK. The Act is retrospective, so allows access to information regardless of when that information was created or how long it has been held by the public authority. The Act applies in England , Wales and Northern Ireland . The Scottish equivalent is the Freedom of Information (Scotland Act) 2002, which is similar, although not identical, to the Act.

Use of the Act by business

Although it is still early in terms of trying to predict just how the Act will be used, the US experience has shown that the biggest users are other businesses. It is common for a company tendering for a US government contract to try and use the US equivalent of the Act to gather information held on its competitors.

ACE is aware of the least one instance when a member was advised by the PA of a request (which has been made by another member company) for disclosure of its tender documentation. The matter was satisfactorily resolved and disclosure was prevented but the incident necessitated much involvement of senior management time. If this practice were to become prevalent, the amount of lost management time in challenging such requests may well have an adverse effect on productivity in the industry as a whole, not to mention on the culture of co-operation and integration which the industry is being encouraged to foster. Those seeking information might, in another circumstance, find themselves recipients of similar request under the Act!

Steps to Protect your Business

The right to request information held by a PA is subject to many exemptions, the most relevant of which to private sector businesses are (a) an absolute exemption if the requested information was provided to the PA in confidence or (b) a qualified exemption for any commercially sensitive information and trade secrets, or where disclosure would prejudice the commercial interests of any party. There is further information at the end of this briefing note on the ‘commercial interests’ exemptions. However, here are a few suggested steps that you could take in order to protect your business when dealing with PAs:

If you regularly work with a PA, it is important for you find out how that particular PA intends to handle freedom of information requests. There is a ‘good practice’ recommendation that government bodies should notify businesses about requests to examine their documentation but there is no obligation in the Act for a business to be consulted before the information is disclosed.
As the PAs are not able to contract out of the obligation under the Act by agreeing overly restrictive confidentiality provisions, you should consider strengthening your contracts with PAs e.g. by adding a contractual requirement for the PA to consult with you, or at least notify you, if a third party makes a request under the Act for disclosure of information relating to your business: obliging the PA to consult with you whether the public interest test is balanced in favour of disclosure or whether disclosure would amount to substantial prejudice.
Where possible, you should build in safeguards, e.g. qualifying your tender documentation by stipulating what your company considers is commercially sensitive information that should be disclosed and identifying any trade secrets. Where possible, you should get the PA to acknowledge this in writing.
A good practice to adopt is to mark all correspondence and other information supplied to a PA as “Commercial In-Confidence”, or some other type of confidentiality notice. However the marking of the information and correspondence as “Commercial In-Confidence” will by no means guarantee its exemption from disclosure. Whether or not an obligation of confidence has arisen is essentially a legal question.
You should ensure that employees who negotiate and deal with tenders and contracts with PAs understand how the Act may apply.

Challenging a request for disclosure

Anecdotal evidence suggested that, if you are consulted by a PA regarding a request for disclosure of your confidential or commercially sensitive information, you are advised to give the PA as much information as possible as to why the request should be denied. This may sound obvious but it is important not to see the PA in question as an enemy. The person dealing with the request on the PAs side may be inexperienced and possibly inundated with requests for information under the Act from all sorts of sources! You will greatly assist your case if you can provide the PA with a carefully crafted letter, setting out all possible exemptions that may apply to your information, quoting the relevant sections of the Act and/or referring to any contractual provisions or correspondence.

Clarification of the “commercial interest” exemption

The Information Commissioner (“Commissioner”) has recently considered the prejudice to commercial interests” exemption and decided that disclosure of the price of a work of art paid by a PA to an artist would prejudice the commercial interested of the PA as well as the artist.

The brief facts of the case were as follows. In January 2005 a request was submitted to a PA, by the National Maritime Museum , for the disclosure under the Act, for documents and correspondence relating to payments made by the PA to an artist in respect of the work in an exhibition that the PA was staging. The PA refused to disclose the requested information and a complaint was made to the Commissioner, who decided that the commercial interests exemption would apply to this information and applied the public interest test (i.e. whether it should nonetheless be disclosed in the public’s interest).

The Commissioner’s view was: “Those who engage in commercial activity with the public sector must expect there may be a greater degree of openness about the details of those activities than had previously been the case prior to the Act coming into force.“

But in certain circumstances the Commissioner acknowledged this may prejudice the individual artist and that there was a public interest in encouraging new artists and entrepreneurs to flourish. It was further recognised that the PA would be playing a crucial role by exhibiting the artists work. The Commissioner also recognised there would be prejudice to the artist in relation to his next sale or commission had the information been disclosed under the Act. Interestingly, when analysing the public interest test in relation to this prejudice, the Commissioner decided that the prejudice to the artist’s commercial interests was not in itself a sufficient reason to maintain the exemption in his individual case.

This note has been produced with the assistance of ACE (Association for Consultancy and Engineering) using an extract taken from its Briefing Note on this topic as referred to above.

The full briefing note can be found on the ACE website (http://www.acenet.co.uk/documents/FoI%20Act.pdf )

Article Business Practice Data Management

BDA audited drilling operatives

28th May 2007 - by Ann-Marie Casserly

Tags: BDA Drilling

The following is general wording suggested by BDA for all drilling operations:-

Audited Land Drilling Operatives

All drilling operatives (Lead Drillers and Drillers) employed on the Contract shall hold a valid and current Audit card of competence applicable to the work and specific drilling operation on which they are engaged, as issued by the British Drilling Association Limited under its BDA Audit or an equivalent body in a State of the European Union.
All drilling operatives (Lead Drillers and Drillers) employed on the contract shall hold a valid and current CSCS blue skilled (Land Drilling) card as issued by Construction Skills Certification Scheme Limited or an equivalent body in a State of the European Union.

Notes

With regard to clause 1, this covers the NVQ requirement as operatives are only admitted to BDA Audit after having provided evidence that they are already NVQ qualified.
With regard to clause 1, the words “applicable to the work and specific drilling operation” can be further defined for specific contracts. The BDA Audit card endorsements for a Lead Driller in ground investigation are one or more of the following:
– Ground Investigation – Cable Percussion
– Ground Investigation – Rotary
– Ground Investigation – Dynamic Sampling
For Lead Drillers in other drilling disciplines the endorsements are: –
– Drilling and Grouting
– Drilling and Anchoring
– Marine – cable percussion
– Marine – rotary
– Water well – cable percussion
– Water well – rotary
– Landfill drilling – cable percussion
– Landfill drilling – rotary
– Geothermal drilling

Please note that a Driller (who supports the drilling operation and was previously termed secondman) does not have any drilling discipline endorsements on his/her card. Neither the NVQ or BDA Audit processes, at this stage, assess or endorse them for specific works.

With regard to clause 2, the BDA Audit does in fact require proof of this for anyone applying for BDA Audit status and thereafter on each 12 month on site Audit. But it’s possible that an individual’s CSCS card may have expired between audits, so this is why we suggest this clause as well.

Article Business Practice Data Management

Drilling competence – what’s the current proof?

28th May 2007 - by Ann-Marie Casserly

Tags: Drilling Geotechnical qualification

BDA Driller Accreditation is dead and buried. Its passing away went largely unannounced but it no longer exists. The British Drilling Association (BDA) has rolled out a new model, more fit for present and ongoing times. It’s called BDA AUDIT and features many improvements over its predecessor, being more embracing, inclusive and rigorous. With CDM 2007 making greater demands on the assessment of competence prior to workforce engagement, new BS EN geotechnical standards for auditing of drilling personnel and CSCS requirements, BDA Audited drilling operatives will supply the necessary third party proof of competence.

There’s been a sea change since the BDA Driller Accreditation Scheme came into being during 1991, some 16 years ago. The Scheme was originally introduced because of concerns about drilling quality, expressed principally by the Department of Transport and the Property Services Agency. The BDA was essentially charged, by those major clients of ground investigation, to produce a driller competence assessment system and ongoing auditing of competence. BDA Driller Accreditation was the result, becoming widely accepted by the geotechnical community and specified in contract documentation.

The same quality concerns exist today. Even more so because of the dependence on obtaining representative samples for more sophisticated laboratory testing, less experienced site supervision because of the skills shortage amongst clients and engineers to meet the volume of work, and commercial pressure. Rubbish in, rubbish out will always apply!

While BDA Driller Accreditation halted any further declines in quality, it had limitations in how far it could go to improve standards. This was partly a funding matter. Contractors were solely being asked to pay fees for their drillers to become accredited in the expectation that their drilling workforce would be employed. The reality was that non BDA Accredited drillers continued to be employed by industry clients. A company will only pay additional to an external body if it believes that a further benefit can be gained.

However the main reasons for moving on from BDA Driller Accreditation were to do with what was happening nationally. National Vocational Qualifications (NVQs, and in Scotland , SVQs) were becoming the measure of competence. NVQ assessment, conducted properly, is a far more rigorous and time involvement process. It is a government qualification and far more recognisable than any single industry sector award. The BDA grasped the opportunity in 2001 to develop and introduce NVQ Land Drilling, level 2, for all drilling operatives whatever their drilling discipline or position in the drilling crew. Since then the BDA has worked with ConstructionSkills (formerly CITB) to try and ensure consistency of assessment.

NVQ Land Drilling qualification, while supported by the BDA as a first step, is not sufficient. Any qualification is held for life, but without revisiting cannot be regarded as current competence. The ability to do a job today is not proven because of qualification in the past. Continuing Professional Development (CPD) evidence is required to maintain an individual’s status. The recent introduction of BS EN ISO 22475, part 3, on geotechnical sampling, requires that drilling operatives are audited regularly, post initial assessment – this is a European endorsement that ongoing auditing by an independent agency is required.

There are variations in the quality of NVQ assessment. Despite the BDA being involved it does not have control of the process. The BDA is highly critical that certain individuals may have become NVQ qualified through fast-track procedures, often through no fault of their own but because of lack of awarding body vigilance. This is a specialist industry and certain NVQ Assessors / Centres may not have the necessary experience to assess to the industry’s high standards.

The BDA AUDIT requirements are that any applicant is in possession of NVQ Land Drilling and a valid / current CSCS card (Construction Skills Certification Scheme card). This proves to the BDA that the individual has obtained an NVQ and passed the ConstructionSkills basic Health & Safety Test. An on-site audit is conducted on the individual by a BDA Auditor before Audited status is awarded. This initial audit covers competence, safety and equipment. Should non-conformances be identified they have to be closed off before the issue of a BDA Audited card. The card is the only proof of their status other than enquiry to the BDA office. The process repeats itself every 12 months.

The BDA took a real risk, on behalf of both sides of the industry, some 6 years ago, in deciding that NVQ / CSCS was the way forward and that a new BDA Auditing process would establish itself with the demise of BDA Driller Accreditation. It wasn’t easy giving up a completely in-house process. We do encourage AGS members to adopt this highest proof of drilling operative competence by specifying BDA Audited drilling personnel. Model clauses for insertion into tender documents are suggested below.

All drilling operatives (Lead Drillers and Drillers) employed on the Contract shall hold a valid and current Audit card of competence applicable to the work and specific drilling operation on which they are engaged, as issued by the British Drilling Association Limited under its BDA Audit or an equivalent body in a State of the European Union.
All drilling operatives (Lead Drillers and Drillers) employed on the contract shall hold a valid and current CSCS blue skilled (Land Drilling) card as issued by Construction Skills Certification Scheme Limited or an equivalent body in a State of the European Union.

We can assist with further guidance as to definitions and application of the model clauses.

Brian Stringer, National Secretary, BDA. Tel: 01327 264622

Email: office@britishdrillingassociation.co.uk Fax: 01327 264623

Web: www.britishdrillingassociation.co.uk

Article Data Management

Electronic tenders – What has changed in the last three years?

28th May 2007 - by Ann-Marie Casserly

Tags: electronic survey tender

A survey of AGS members in 2003 revealed that most respondents (74%) had tendered for work based upon information provided in an electronic format but few had purchased or sold construction related products online, and only 20% had experience of electronic auctions. A similar survey was conducted in the autumn of 2006 of both AGS and FPS members. Had anything changed and is the experience of AGS Members and FPS members the same?

E-Procurement Survey
	2003	2006
Members Experiences	AGS	AGS	FPS
Tendering on the www (electronic auctions)	20%	24%	71%
Buying products/services online	38%	42%	36%
Selling products and services online	5%	9%	0
Tendering based on electronic information	74%	72%	100%

The results of the recent survey show that the level of buying and selling construction related products online has remained about the same and is broadly in line with the experience of FPS members. Similarly, the number of respondents tendering based upon electronic information has remained about the same and is consistent with FPS members, although FPS members seemed to tender based on little other than information provided in electronic format. The area showing the largest difference between FPS and AGS members was in the use of electronic auctions. Over seventy percent of FPS members had some experience of electronic auctions whereas the number of AGS members with experience of electronic auctions had increased but was about the same as the findings in 2003. The results show that the use of electronic auction is high in the world of specialist contracting but is still in its infancy in other parts of the industry. Nevertheless, both FPS and AGS members remain cautious about the all round benefits of electronic auctions but remain enthusiastic about the use of electronic information in the tendering process but only if, as will be seen below, some of the basic indexing issues are addressed.

Tendering based upon Electronic Information

The results indicate that for AGS members, very little has changed in respect of e-data. Electronic tender information is routinely provided by some clients – but only 50% of consultants have ever received it (and of those, only half receive it for more than 50% of tenders.) All contractors (AGS and FPS) have received electronic data with an enquiry at some point, but even they, receive it on average only 30% of the time.

When it is available, electronic data arrives on CD about 90% of the time for piling contractors, but SI contractors and consultants are more likely to be the recipients of emailed data (50%-100% of all e-data). (This is a change from 2003 when AGS members received email data only 12% of the time).

In 2003, 68% of those using electronic information had experienced difficulties typical of tendering based upon electronic information: poor indexing; irrelevant information (i.e. information overload); and data that could not be manipulated. Had the situation improved in 2006? Not a lot.

Respondents were asked to report on the last enquiry they had received that contained electronic data. All Piling contractors complained that the data they received was poorly indexed, and generally only 25% was relevant to the project. Virtually none of the data could be manipulated. Anecdotal evidence elsewhere indicates that even when AGS Data is received it is likely to be in PDF format. In a separate study of SI reports received by FPS Members over a 3 month period – not one of the SI’s sampled had AGS Data¹. Not surprisingly, only 2 contractors (one AGS and one FPS) felt that electronic information saved time. Clearly there is considerable room for improvement.

AGS members seem a little more fortunate. Indexing is rated slightly better; 50-75% of the information is likely to be relevant; and occasionally the format can be manipulated.

The joint FPS and AGS electronic tendering protocol may be found on www.fps.org.uk and www.ags.org.uk respectively.

Electronic Auctions

Since the last survey, both the AGS and the FPS have published position papers questioning the usefulness of e-auctions for the award of geotechnical service contracts. Despite the relative infrequency of e-auctions, Members of both Associations have strong negative views about their use:

“E-Auctions are inappropriate for professional services and work where the extent is uncertain or cannot be accurately quantified in full at the outset.”

“Terrible, to be avoided if at all possible”

“Recipe for disaster. Will encourage firms to reduce margins to unsustainable levels and takes no cognisance of the quality of bid or any qualifications thereto.”

“Not appropriate to specialist services with considerable design input/risk.”

“Completely inappropriate for the procurement of specialist services. Does not promote value engineering or innovation.”

The FPS and AGS position papers on the use of electronic auctions may be found on www.fps.org.uk and www.ags.org.ukrespectively.

Does IT help the tender process?

The jury is still out. AGS members and their FPS counterparts appear to be comfortable with IT and with the use of the internet for the transmission of data but remain to be convinced of the benefits of electronic auctions. The expected benefits are, however, a long time coming and there is little evidence of measurable progress over the last 3 years.

Work is now underway in the Business Practice WG to try to understand the process in more detail. Although it is thought that AGS SI contractors are able to produce AGS data, and many do so routinely, there is little hard evidence to support the view and this will be addressed via a survey in 2007.

FPS Members are now increasingly requesting, but not getting, AGS data and discussions are underway between the AGS and FPS to look for a solution to the communication ‘log jam’ that prevents the flow of information between the SI contractor, SI consultant and the piling contractor end user.

Without doubt, there is room for improvement at all stages and by all participants if information is to flow smoothly throughout the project from SI to as built pile records. Some aspects are outside AGS influence and control – other areas are already being addressed. Most people are aware of the potential benefits but the evidence suggests that over the last 3 years progress towards the ideal has been slow.

Presentation at AGS Members’ Day 2007. ‘How useful is the typical geotechnical report – an evaluation by the FPS’ Derek Egan, Keller Foundations

Article Business Practice Executive

Age Discrimination Regulations

28th Jan 2007 - by Ann-Marie Casserly

Tags: Age Equality Evesheds regulations

Members trying to come to grips with the Employment Equality (Age) Regulations 2006 can find information on the Evesheds website www.eversheds.com. (Drill down via ‘Services and Sectors’ to ‘human resources’ and ’employment law’ to find a list of articles published in this area.)

One of the most useful is entitled, ‘Age Regulation – an insight into how employers are responding to the issues’ (issued 24 October) which reports the results of a survey of 150 organisations. Each section begins with a very brief summary of the Regulations, and ends with a section entitled ‘implications and actions’

Article Business Practice Laboratories

Reinforced Fill

28th Jan 2007 - by Ann-Marie Casserly

Tags: fill reinforcement

BS EN 14475:2006 establishes general principles for the construction of reinforced fill. It covers engineered fills which are reinforced by the inclusion of horizontal or sub-horizontal reinforcement placed between layers of fill during construction.

The scope of reinforced fill applications considered in this European Standard include:

Earth retaining structures (vertical, battered or inclined walls, bridge abutments, bulk storage facilities) with a facing to retain fill placed between the reinforcing layers
Reinforced steep slopes with a facing (either built-in or added or wrap-around) reinforced shallow slopes without a facing, but covered by some form of erosion protection without a facing, and reinstatement of failed slopes
Embankments with basal reinforcement and embankments with reinforcement against frost heave in the upper part

Principles for the execution of other special geotechnical works using soil nails, bored piles, displacement piles, micro piles, sheet pile walls, diaphragm walls, grouting or jet grouting are established in other European Standards. Reinforcement of road pavements is not covered by this Standard.

Price £136, Member Price £68
ISBN 0 580 49309 1

To order please contact our Customer Services department quoting reference 14475K-SA:

Tel:	44 (0)20 8996 9001
Fax:	44 (0)20 8996 7001
Email:	orders@bsi-global.com

Article Laboratories

Soil Classification

28th Jan 2007 - by Ann-Marie Casserly

Tags: classification composition Geotechnical identification

BS EN ISO 14688-2, together with BS EN ISO 14688-1, establishes the basic principles for the identification and classification of soils on the basis of those material and mass characteristics most commonly used for soils for engineering purposes. The relevant characteristics may vary and therefore, for particular projects or materials, more detailed subdivisions of the descriptive and classification terms may be appropriate.

The classification principles established in standard permit soils to be grouped into classes of similar composition and geotechnical properties and, with respect to their suitability for geotechnical engineering purposes, such as:

Foundations Ground improvements
Roads Embankments
Dams Drainage systems

BS EN ISO 14688-2 is applicable to natural soil and similar man-made material in situ and redeposited, but it is not a classification of soil by itself.

Identification and description of rock are covered by BS EN ISO 14689-1

BS EN ISO 14688-2:2004 partially supersedes BS 5930:1999, which remains current.

ISBN 0 580 47508 5
Price £68

Member Price £34

ISBN 0 580 40481 1

Price £68*
Member Price £34

Contact BSI’s Customer Services team

Tel:	44 (0)20 8996 9001
Fax:	44 (0)20 8996 7001
Email:	orders@bsi-global.com

When ordering please quote marketing reference 14688G-N

Article Business Practice Data Management Loss Prevention

Equitable contribution clauses

27th Jan 2007 - by Ann-Marie Casserly

Tags: equitable ground liability

Scenario: a homeowner decides to have an extension built at his house and employs a consultant and a contractor to carry out work relating to the foundations. Two months after the work is completed, the roof of the extension collapses because a wall structure was badly constructed and was unstable. The homeowner wants compensation, claiming that both the contractor and the consultant are to blame; he claims that the contractor provided poor workmanship and the consultant failed adequately to assess the ground conditions.

But who can the homeowner sue? Can he sue the contractor, the consultant, or both?

Why include an equitable contribution clause in a contract?

An equitable contribution clause, sometimes known as a net contribution clause, contract seeks to ensure that where two or more parties (e.g. consultants and contractors in our scenario) are liable for the same damage, the liability of each party is restricted to the amount for which that party is responsible. Such clauses have been included in professionals’ conditions of engagement and collateral warranties for some time. They are included in the standard terms of engagement published by various professional bodies such as the Royal Institute of British Architects and the Association of Consulting Engineers.

How does an equitable contribution clause operate?

In our scenario, an equitable contribution clause in the homeowner’s contract with the consultant would state that if the consultant is liable, that liability will be capped at whatever it is just and equitable for the consultant to pay having regard to his and any other person’s fault. In the absence of the equitable contribution clause, the homeowner is free to sue the consultant for 100% of the damages he has suffered. The consultant can then rely on the Civil Liability (Contributions) Act 1978 to seek to recover a contribution from the contractor.

The law

If parties have joint liability, then they are each liable up to the full amount of the relevant obligation; the converse is several liability, where the parties are liable for only their respective obligations. Joint and several liability is a hybrid of both; with respect to our scenario, the consultant and the contractor are jointly liable, but as between themselves, their liabilities are several.

The Civil Liability (Contributions) Act 1978, s. 1(1) provides that a person who is liable in respect of any damage is entitled to recover a contribution from any other person liable in respect of the same damage. This means that if the homeowner pursues the consultant for damages, and receives payment in full, the consultant can then pursue the contractor for a contribution to their share of the liability.

Shifting risk and responsibility

Back to our scenario: in the absence of an equitable contribution clause, the homeowner decides to sue the consultant for the damage he has suffered. By paying all of the damages to the homeowner, the consultant takes the risk that the contractor is solvent and so will be able to meet any claim under the Civil Liability (Contributions) Act 1978. If the contractor is insolvent, then the consultant will not have a meaningful remedy.

But if the consultant is a party to a contract which contains an equitable contribution clause, the risk of the contractor’s insolvency shifts to the homeowner. If the consultant is 30% responsible and the contractor 70% responsible, then the consultant will be liable only for 30% of the homeowner’s loss, even though under the joint and several principle he would be responsible for 100%, and even if the contractor is insolvent. The equitable contribution clause means that the contractor’s 70% fault is funded by the homeowner rather than the consultant.

Invariably, developers and investors are not keen on equitable contribution clauses as they can affect recovery of losses. Insurers, on the other hand, welcome such clauses. For consultants and contractors they have an important role to play in an effective risk management strategy.

Example of an equitable contribution clause

This example is shown for illustrative purposes only and should not be regarded as a substitute for taking legal advice.

Without prejudice to any other exclusion or limitation of liability, damages, loss, expense or costs the liability of [the Consultant] for any claim or claims under this Agreement shall be further limited to such sum as it would be just and equitable for [the Consultant] to pay having regard to the extent of his responsibility for the loss or damage giving rise to such claim or claims (‘the loss and damage’) and on the assumptions that:

all other consultants, contractors, sub-contractors, project managers or advisers engaged in connection with [the Project] have provided contractual undertakings on terms no less onerous than those set out in Clause [ ] to the [the Client] in respect of the carrying out of their obligations; and
there are no exclusions of or limitations of liability nor joint insurance or co-insurance provisions between the [Client] and any other party referred to in this clause and any such other party who is responsible to any extent for the loss and damage is contractually liable to the [Client] for the loss and damage; and
all such other consultants, contractors, sub-contractors, project managers or advisers have paid to the [Client] such sum as it would be just and equitable for them to pay having regard to the extent of their responsibility for the loss and damage.

Dr Alan McBride

Steven Francis

Eversheds LLP solicitors

Article Business Practice Executive Safety

Guidance on the use of HBM in working platforms

27th Jan 2007 - by Ann-Marie Casserly

Tags: Guidance HBM

New guidance has been launched by WRAP entitled ‘Guidance on the use of HBM in working platforms’. This covers the key issues related to working platforms constructed using stabilised materials, providing detailed guidance for the platform’s design, specification, installation, operation, maintenance and repair.

Within the guidance document are case studies on three construction projects, which have made significant gains from using on-site soils and granular materials in the construction of a working platform. This can be downloaded, free of charge fromwww.wrap.org.uk/applications/publications (search on HBM and click on the PDF icon).

FPS sponsored guidance entitled “Working platforms for tracked plant: good practice guide to the design, installation, maintenance and repair of ground-supported working platforms” can be obtained from www.brebookshop.com. This will cost £49.35.

Article Contaminated Land

Supporting the contaminated land community

27th Jan 2007 - by Ann-Marie Casserly

Tags: contamination data FASA MCERTS

Dealing with uncertainty and heterogeneity in the risk-based land management process continues to present challenges for the contaminated land community. The up front investment required to more accurately define risk is sometimes difficult to communicate to all stakeholders involved in projects which can, in some instances, lead to regretful compromises.

The EA’s MCerts Policy has increased confidence

Application of the Environment Agency’s MCerts Policy, which standardised laboratory based analytical procedures, has delivered increased confidence in the outputs of samples analysed by laboratories, however the relative cost per sample continues to offer opposition to increasing sampling density. This challenge is recognised by many, including the Environment Agency, however, there is a growing body of evidence to support the conclusion that greater emphasis needs to be placed upon overcoming it if we are to continue to develop potentially contaminated sites whilst eliminating risk and future liabilities

Added value…

Portable field analytical tools are, therefore, being increasingly considered to have an important role in supporting the community overcome this challenge. Their appropriate application can offer many added-value and commercial benefits. These include:

more rapid and cost effective determination of spatial and temporal variations (i.e. heterogeneity);
the optimisation of sampling strategies for subsequent laboratory analysis which, ultimately, increase the quality of site data and confidence; and
in the right circumstances, they can even enable on-site decision making, thereby dramatically saving time and money.

Such tools have been available for several decades and have been rigorously applied in other environmental fields, such as the trade effluent and stack emission monitoring. However, their application in the contaminated land sector has been relatively low to date. There are many rational reasons for this, including a lack of awareness and confidence in their application, due, in part, to a lack of case history providing technical and economic evidence; a lack of available skills within the practitioner community; and a limited level of acceptance in their application and interpretation throughout the community.

FASA workshop

To this end, FASA, the Field Analytical Suppliers Association, hosted x4, one-day workshops this year, to provide attendees with a practical introduction to field analytical tools.

These events included:

the provision of information related to how they fit within the UK regulatory framework, kindly provided by Bob Barnes and Brian Bone from the Environment Agency;
an overview of available tools and case study information detailing the application of five of the most commonly applied; and
attendees were provided with the opportunity to see the tools for themselves and gain answers to their individual needs during afternoon demonstration surgeries.

What is FASA?

FASA is an independent body created to support the efforts of regulators, industry and laboratories in the management of potentially contaminated environments. It is funded and coordinated by suppliers and manufacturers of field tools in the UK and is supported and administered by IPM-Net.

The workshops described form part of its commitment to assist the community gain an informed understanding of the application of field analytical tools and their appropriate use. FASA aims to further assist the community by working with key stakeholders to develop guidelines, training material, best practice QC/QA procedures as well as technique specific information, such as case studies and evaluations.

Following analysis of the attendees’ feedback from the workshops it is clear that such information will assist the community, with 81% and 77% stating that the lack of available guidance and performance information, respectively, were barriers to their uptake. Their perceived costs, a lack of regulation and a lack of information on how to use field tools were, individually, seen as barriers to 60% of attendees.

New guidance being developed

The Environment Agency is currently developing guidance on the use of field analytical tools within the risk-based approach to land contamination. This document will discuss, amongst other aspects, the application of field tools in the context of sampling and analytical plans, fit for purpose decision making, building lines of evidence and informing conceptual site models. The first draft is likely to be circulated to the FASA committee by the end of this year, with further release anticipated to occur in the Spring of 2007.

For further information contact:

Mr Perry Guess , FASA Chairman

Tel: 01865 610504

E-mail: perry.guess@earth.ox.ac.uk

FASA representatives will give a presentation at the next Contaminated Land WG (20 February 2007) on the use of field analytical tools.

Article Business Practice Data Management

Single Point Project (Financial Loss) Insurance (SPPI)

27th Jan 2007 - by Ann-Marie Casserly

Tags: insurance

The government is to trial a radical new form of project-wide insurance on about 10 public sector schemes. The move is part of the government’s drive to improve public sector procurement efficiency following the Gershon review. It will be watched with interest by the Olympic Delivery Authority which is planning to introduce project-wide insurance on all Olympic 2012 sites. The major government spending departments will put forward one or more schemes, worth between £10m and £20m, for the trial, which is expected to begin by the end of the year. It will include schemes from the Building Schools for the Future initiative, the Department of Health’s ProCure 21 scheme, as well as projects from the Highways Agency, Defence Estates and Cambridge University Estates.

The insurance scheme, known as Single Point Project (Financial Loss) Insurance (SPPI) is being championed by the Office of Government Commerce with the support of the Public Sector Construction Clients’ Forum, chaired by Sir Christopher Kelly. It is based on a scheme operating in Belgium , where integrated teams are monitored by an independent “technical assurance” bureau trusted by insurers, and which has resulted in the cost of premiums plummeting by 30%. The initiative has been developed for the British market by a team from the construction and insurance industries, led by Martin Davis, chair of the Strategic Forum’s integration steering group.

Davis told CJ that SPPI was an attempt to help the industry become less adversarial and more collaborative. “Traditionally all contracts and insurances are focused on each individual supplier rather than the team. There is a preoccupation with liabilities and the blame culture inhibits true collaboration,” he said.

Under SPPI the client and the insurer appoint independent experts for technical and cost assurance at the beginning of the project, who help appoint an integrated team and then monitor the project’s progress from design development to completion. They also monitor risks affecting safety, performance and cost, allowing prompt remedial action and cost-effective latent defects insurance.

The integrated team’s collective profits are geared to performance criteria, their share of the profits is agreed upfront and the team members pledge not to sue each other for anything but fraud. “In Belgium , this form of insurance has seen premiums fall by 30% because the risks are significantly reduced, since the project is closely monitored and suppliers are working as a team with their profits tied to everyone succeeding. “At the same time it cuts out the huge legal and forensic costs that come with having a multitude of policies,” Davis said.

Five leading insurers have agreed to provide cover for the pilot projects, subject to suitable capping for maximum liability. These are expected to include Norwich Union, Royal and SunAlliance and Zurich Cost assurance will be provided by Davis Langdon and the technical assurer will be SECO, the independent advisor used on the Belgium project insurance scheme. The pilot schemes are expected to be identified by the end of the year.