Over the past year there have been significant changes in the way that costs in litigation are being dealt with by the courts that are highly relevant to construction disputes where the costs can be large. Recent statistics show that the amount of recoverable costs that a party can expect to receive if successful in litigation is dropping. In this Report we mainly examine recent case law affecting costs. We then look at the rise in alternative dispute resolution, and in particular at mediation which increasingly is becoming a mandatory requirement before the court will permit a party to proceed to full litigation. We then consider recent case law affecting other aspects of the construction industry in the United Kingdom, and in particular we focus on adjudication which has now become the main method of resolving construction disputes in the UK. However we begin with some brief notes on the JCT Major Project Form 2003 and the new Construction Industry Council forms of collateral warranty and novation agreement and the Late Payment of Commercial Debts (Interest) Act 1998.

This new form of contract was released on 23 June 2003. It is aimed at use on large-scale projects and will provide an additional lump sum contract alongside the well-established JCT98 Standard Form of Building Contract and the JCT98 Standard Form of Building Contract With Contractor’s Design (“WCD98”).