London has long been the preeminent forum for complex, cross-jurisdictional construction and supply chain disputes. The High Court has a dedicated division that specialises in construction cases, the Technology and Construction Court (TCC). Construction disputes are therefore heard by specialist judges in London with considerable expertise in the field.
"Sixty-two per cent of cases in the TCC between 1 October 2020 and 30 September 2021 were settled before judgment"
In the period October 2020 to September 2021, 521 new claims were registered in the TCC, representing an increase of 7 per cent on the previous year, and it is likely that the volume of construction disputes will continue to rise.
Construction litigation in London is highly efficient, with most cases resolved in fewer than 12 to 18 months from the issue of the claim form to final judgment. TCC judges have extensive experience of international work, with a significant proportion of cases involving international parties or a project overseas. The quality of service offered in London extends beyond the bench, with specialist chambers dedicated to construction disputes, and City law firms with highly experienced practitioners, as well as industry professionals.
The English courts also encourage the parties to engage in alternative dispute resolution, which can save significant costs and time; 62 per cent of cases in the TCC between 1 October 2020 and 30 September 2021 were settled before judgment.
London also remains a very popular arbitral seat for construction and supply chain disputes. Disputes regarding construction/engineering and energy historically generate the largest number of cases registered with the International Chamber of Commerce (ICC). In 2020, London was the second most popular city for ICC arbitrations, after Paris, with 85 cases, representing 12 per cent of cases registered with the ICC, seated in London (although England was the fourth most popular jurisdiction overall). English law was the most popular choice of law, with 122 cases (13 per cent of all cases registered), governed by English law. In addition, the UK was the most represented nationality among arbitrators with 220 arbitrators (14.5 per cent of all appointments). The London Court of International Arbitration also deals with numerous construction and infrastructure cases.
Global remit
Arbitration hubs such as Singapore have significantly increased in popularity in recent years, but they tend to have more of a regional focus. Seventy-three per cent of the top 10 foreign parties to arbitrations administered by the Singapore International Arbitration Centre (SIAC) in 2022 originated in the Asia Pacific region. It is notable that 19.5 per cent of cases administered by SIAC in 2022 were governed by English law and 92 of the 340 arbitrators appointed by SIAC were from the UK (second behind Singapore with 112 Singaporean arbitrators appointed in 2022), indicating that the influence of English law extends well beyond arbitrations seated in London.
Other forms of alternative dispute resolution, which are expressly designed for construction disputes with the aim of keeping the project on foot pending final resolution of the dispute, such as adjudication and dispute boards (DBs), are also available in London, and a high proportion of adjudicators and DB members are English or Scottish. Adjudication/DBs involve appointing an adjudicator or a panel to hear the dispute, following an expedited and cost-effective process, and reach a decision in a matter of weeks. Such procedures may be essential to the viability of a construction project if work cannot resume or may be terminated if a resolution is not reached. While most construction contracts provide that a DB decision may be revisited either in arbitration or in the courts, anecdotal evidence suggests that the vast majority either are not challenged or that the original decision will be upheld.
In addition to the above noted trends, developments such as the energy transition towards net-zero carbon emissions will drive significant investment in renewable-energy projects in the coming years, which will inevitably involve construction issues, most of which are likely to involve international parties.
London is particularly well-suited to resolve any disputes that arise as it is generally considered to be a neutral forum with an established and internationally renowned legal system. A high proportion of construction contracts (and thus disputes) are governed by English law and will therefore require the involvement of English lawyers, whether as advocates or arbitrators, even if not seated in London.
Originally published by Construction News.
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