RDJ recently held a construction panel discussion "Construction Contract Administration in Practice" as its Cork office at 85 South Mall.
It was an engaging discussion by RDJ Construction Partner. Finola McCarthy featuring Stuart Griffin, Director at AECOM; Eoin Long, Chief Operating Officer at TLI Group; and Shane O'Connor, Construction Partner at RDJ, who examined the current challenges and opportunities in administrating construction contracts in Ireland.
Key Takeaways from Panel Discussion
Contract Administrator Duties
The panel first looked at the role of a Contract Administrator in terms of the duties it has as a client-agent and its obligation to act impartially.
The issue was considered from contrasting perspectives. From the point of view of the employer, the main role of the Contract Administrator is to be the conductor of the contract. While t the administrator is referred to as the employer’s representative and appointed by the employer, the role is to be impartial and to administer the contract fairly.
From the perspective of the contractor, the panel emphasised the importance that the communication lines are clear, that instructions issue from the Contract Administrator only and that instructions and change orders etc. are clearly communicated and labelled as such and contract notices are issued in time. A lack of clarity of communication is often the main pitfall in construction disputes, and issues are often preventable with clear communication and record maintenance.
Recent case law was discussed with Shane highlighting the decision in Ashdrum Lodge Ltd v Barbouti and Ors [2025] IEHC 522 which underscores the importance of maintaining a clear contractual arrangement, with proper documentation and adherence to standard procedures.
Payment Issues
The panel discussed the circumstances where a contractor faces a delay in obtaining a payment certificate, or where payment is withheld altogether, it is imperative that the contractor can refer to clear and accurate records and communications. Clarity is of benefit to both parties where they need to ascertain their positions.
The discussion turned to contractual remedies, and the adage of “RTFC – Read the Full Contract”. Understanding the parties’ rights and obligations will provide a roadmap to recovery where payment is delayed or withheld noting also the Construction Contracts Act 2013 which applies generally and the statutory provisions and protections that parties must take into consideration.
The question whether a Contract Administrator can be too contractual or be too strict was considered. The panel agreed that it is important to maintain the contractual position while also keeping the balance between the contractual and commercial positions. The benefit of also having a mechanism to facilitate informal discussion on issues and the need for dispute avoidance was recognised.
The panel noted in particular under the NEC clause 10.1 which mandates that the parties act in a "spirit of mutual trust and co-operation”. This spirit of collaboration fostered under the NEC can be a useful tool to allow the parties to refer back to when the Contract Administrator facilitates such discussions.
Variations
The Ashdrum Lodge case was discussed further where a rolling and ad hoc implementation of verbal & undocumented variations led to intrinsic difficulties in the valuation of the variations. The case of Galway City Council v Samuel Kingston Construction Ltd and Another [2010] IESC 18 held that while the Contract Administrator complying with certification procedures may allow the employer an opportunity to pursue contractual remedies, the employer remains obliged to comply with its contractual obligations, in this case, the obligation to not exercise such remedies unreasonably.
Clarity around change orders and valuation change orders is essential to avoid disputes. There was discussion around the potential conflict of interest where a contract administrator is also responsible for preparation of the design documents. This can create potential issues in maintaining impartiality. It can be avoided by appointing a contract administrator that is separate to the design team.
Some other key takeaways from the discussion:
- Contractor, employer and contract administrator should comply with the contract requirements
- Establish clear lines of communication
- The Contract Administrator should maintain a position of impartiality in relation to payment and certification.
- The opportunity to foster more collaboration and engagement between the parties should be addressed to achieve dispute avoidance.