Worldwide: Year In Review 2017 - Legal Developments In The Global Construction And Infrastructure Sector

Last Updated: 9 February 2018
Article by Clyde & Co LLP

Most Read Contributor in UK, October 2018

INTRODUCTION

We are pleased to present our "Year in review" for 2017, a Clyde & Co guide which sets out legal developments in the construction and infrastructure sector globally over the past 12 months, as well as insights into what you need to be aware of in 2018. We hope that our guide will be a valuable reference in helping you respond to and understand legal and industry developments and how they will affect your business in 2018.

2017 - THE HEADLINES

JANUARY

UK
The Court of Appeal holds that applying extensions of time contiguously remains the correct approach, despite acknowledging the potentially unfair results in certain circumstances.

Canada
The Ontario Superior Court of Justice holds that construction liens do not attach to land with diplomatic immunity.

Canada
The Manitoba Court of Queen's Bench finds that the Canadian Revenue Agency has priority over sub-contractors and bonding companies with respect to holdback funds held by the owner in trust for the contractor.

Australia
The High Court of Australia considers the New South Wales security of payment legislation for the first time, finding that the existence of a reference date is an essential precondition to making a payment claim and that payment claims do not generally accrue following termination.

Australia
The Supreme Court of Western Australia provides clear procedures for parties to make applications in relation to arbitration agreements or proceedings by introducing the Supreme Court (Arbitration) Rules 2016 (WA) (Arbitration Rules).

Tanzania
Electricity project in the pipeline.

FEBRUARY

Hong Kong
The Hong Kong Court upholds enforcement of an ICC award, reinforcing its pro-arbitration stance.

Australia
The Commonwealth of Australia Parliament makes changes to national building legislation relating to the requirements which must be met by parties bidding for Commonwealth funded building work.

Tanzania
Signs MoU on railway project.

MARCH

UK
The Technology and Construction Court (TCC) provides insight into the NEC obligation to act in a spirit of mutual trust and cooperation.

UK
Theresa May formally invokes Article 50 and starts the Brexit process.

Canada
The Canadian Government published its budget for 2017 revealing that the Government and Infrastructure Bank will work to produce a big data bank of information relating to the infrastructure industry.

US
U.S. infrastructure receives a near-failing grade of D-plus from a leading engineering association, adding further significance to President Trump's vow of USD 1 trillion investment in the sector.

APRIL

UK
The TCC finds a broad exclusion clause does not breach the Unfair Contract Terms Act 1977, placing weight on the fact that the risk was something that the excluding party would expect the other to insure against.

UK
JCT completes the release of its 2016 suite of contracts.

Middle East
Saudi Arabia gives 12 months' notice for replacement of combustible cladding.

MAY

UK
The Northern Irish High Court provides further guidance as to how the NEC mutual trust and cooperation obligation should be interpreted by parties administering the contract.

Canada
The Government enacts new legislation to facilitate disclosure of wrongful conduct within the public sector and protect whistle-blowers.

Canada
The Ontario Legislature gives first reading to a bill to bring about a new Ontario Construction Act.

Australia
The High Court of Australia grants special leave to appeal two decisions considering security of payment legislation, the outcome of which will be significant for the industry, and for the efficacy and application of security of payment legislation nationally.

JUNE

UK
NEC releases an updated suite of contracts in the form of NEC4, along with some new additions to the suite: a Design, Build and Operation Contract and consultation Alliance Contract.

Hong Kong
Hong Kong's Legislative Council passes the Arbitration and Mediation Legislation (Third Party Funding) (Amendment) Bill 2016, allowing third party funding of arbitration proceedings seated in Hong Kong.

Hong Kong
The Court of First Instance (CFI) dismisses the contention that a State-Owned Enterprise (SOE) is able to assert Crown immunity. Unless there are exceptional circumstances, Chinese SOEs are unlikely to be entitled to Crown immunity before Hong Kong courts.

US
There is a push to establish a national infrastructure bank to give state and local governments another tool for financing infrastructure projects.

US
President Trump announces the creation of a new council to help project managers navigate the permitting process, changing the focus from "lack of money" to "speedier permit approval".

South Africa
South Africa releases its contentious Mining Charter prescribing an increase in the Black Economic Empowerment Shareholding for all mines.

JULY

UK
The TCC holds that multiple design obligations in a contract may be considered separate and additional obligations on the contractor, provided that they do not operate inconsistently with each other.

Canada
The Ministry of Municipal Affairs announces the replacement of the Ontario Building Code, effective from 1 January 2019.

Australia
The Rail Safety National Law (South Australia) (Miscellaneous No 3) Amendment Act 2017 comes into force, introducing a number of key amendments to the South Australian state legal framework regarding safety in new rail projects.

AUGUST

UK
The TCC confirms that unpaid parties in an adjudication cannot recover their 'reasonable costs' of adjudication via section 5A of the Late Payment of Commercial Debts (Interest) Act 1998.

US
President Trump signs a Presidential Executive Order on Establishing Discipline and Accountability in the Environmental Review and Permitting Process for Infrastructure.

Saudi Arabia
Saudi Arabia to allow full foreign ownership of engineering companies

Australia
The Queensland Government proposes significant reforms to Queensland's building and construction legislation. The reforms aim to simplify existing legislation and improve security of payment for downstream contractors on construction projects.

Tanzania
Tanzania starts the process of reclaiming sleeping industries.

SEPTEMBER

US
President Trump appears to row back on his own infrastructure plan, which focused on PPPs. However, state activity in the PPP initiatives showed little signs of slowing down.

Australia
The Australian Senate Economics References Committee issues its Interim Report: Aluminium Composite Cladding – Nonconforming building products.

OCTOBER

UK
The TCC holds that parties are free to allocate concurrency risk in their construction contracts.

UK
The TCC finds that a firm of architects owed a duty of care to advise their client in relation to the project budget and their ability to work within this constraint.

Hong Kong
President Xi announces the importance of transitioning the Chinese economy from a phase of rapid growth to one of high-quality development.

Australia
The Supreme Court of Western Australia broadly applies the principle of strict compliance to enforce the entitlement of parties under performance and maintenance bonds.

NOVEMBER

US
US voters across the country approve state-developed infrastructure investment ballot measures.

UAE
The draft UAE Executive Regulations provide two immediate action points – register for VAT as soon as possible and review your contractual position.

DECEMBER

UK
FIDIC releases its 2017 versions of the Yellow, Red and Silver Books.

Australia
The Australian national review into Security of Payments legislation in the building and construction industries was due to be provided to the Minister for Employment by 31 December 2017.

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