Building Trust in Construction, or Not?
Updated: Jan 29, 2019
Where has crossing your fingers and hoping it will all be alright ever got you? OK, let’s go easy with each other but you really must assert your rights; don't waive them by being naïve and trusting people.
The power imbalance in construction between Employer Contractor and Subcontractor is difficult to equalise, but contracts should help counteract that.
It’s an exhausting job being a contractor or subcontractor and when you get home you should allow time to unwind. Have cup of tea, get some toast, check your social channels, spend time with the family and your friends, and enjoy the satisfaction of having done great work to make someone’s dream building a reality.
But don’t do this until you have made sure the promises made to you by the client (or the contract administrator on site), and all their instructions are properly recorded in writing. Make sure you feedback to them immediately, confirming your understanding of everything they want. This is as good as cash in your hand, so why would you not want to collect it?
If you fail to do this, you are putting yourself at risk. Don’t kid yourself that you don’t need to do this, because you have a trusting relationship and the Employer will pay, or that you are a good negotiator and you will sort it out at the end in the final account! And please, PLEASE don't let me hear you say that “we are not very contractual” or “we didn’t read the contract”. The contract is king… unless I can find a way to say it’s not.
When push comes to shove, the only trust you can rely on is from your family and close friends, and what has been agreed in writing, because that is what business trust is based on. Step outside of that and you are unprofessional and untrustworthy and taking huge risks. Unfortunately, that is the way it is!
In most JCT contracts, trust between the Employer client and you, the Contractor of the subcontract, is written into the contract and it’s down to you to make sure you operate the clauses wherever you can. The position of the Contract Administrator appointed by the Employer usually is that they have a quasi-judicial duty to be fair and reasonable when administering the contract.
Additional work required mid project?
It’s often the case that you will be asked to do additional work mid project. When this happens, you must record the request in writing and follow the procedure for getting the quote for the variation approved. It’s got to be done. Don’t move on it until you have it signed off, because that could be taken by the Employer client as a breach of trust, which sounds confusing when you think you are doing the client a service. However, the Employer client may see it differently and as a way for you to extend your fee and take advantage.
Delays due to unforeseen circumstances
Equally, if you are delayed for reasons which are exceptional, such as the ‘Beast from the East’, or by carrying out variation work, then get your application in for an extension of the date set in the contract, for practical completion. Don’t delay, because if you do, memories of the situation will fade and your application could be easily rejected, just when you want to be paid! Where the contract has a Liquidated Damages Clause, then delays in achieving practical completion will be used as a reason by the client for serving a Payless Notice.
So, the lessons are:
Read the contract and make sure you know exactly how it operates.
Operate the mechanism in the contract via the contract administrator.
Establish trust by doing this; not by ignoring it.
Enjoy your tea and toast and feel secure in the knowledge that if you need to enforce your rights, you haven’t waived them or exposed yourself to Payless Notices.