As another transformative year comes to an end for construction, Womble Bond Dickinson’s lawyers review the industry’s major legal changes in 2024 – and what the sector should expect for 2025.
Firstly, what happened in 2024?
2024 has been, once again, a year of significant developments for the built environment. Five key events and trends were:
- JCT’s much-anticipated 2024 suite published – The latest contracts include new allocations of risk around unexploded ordnances, contaminated materials and asbestos; new relevant events and relevant matters (for extensions of time and claiming loss and expense); a process to resolve disputes early; and alignment with legal developments, including insolvency and building safety. While uptake of previously updated JCT suites took some time as the industry preferred the older, more familiar versions, adoption of 2024 suite has been swift, not least because of the need to include building safety changes.
- Building safety locked in place – After a flood of new legislation and guidance in 2023 and 2024, the legal framework for building safety is now mostly in force, with the last pieces falling into place in April 2024 (we say ‘mostly’ because this is an evolving area). The industry is still getting to grips with these gargantuan changes, and it will take some time before this becomes second nature for the industry.
- A new government with new plans – In the few months it has been in power, the new Labour government has made several announcements that impact the construction industry. New plans include the building of new homes and boosting affordable housing; re-energising renewable and clean energy projects; updating the National Policy Planning Framework; funding infrastructure projects; and reforming the planning regime. Many of these plans put the construction sector squarely at the forefront of change.
- A worryingly high rate of insolvencies – Unfortunately, many construction businesses went under in 2024 – 4,264 in the 12 months to September 2024, according to recent government statistics. ISG’s insolvency, in particular, sent shockwaves throughout the sector, affecting supply chains and delaying major projects. It is reminiscent of Carillion’s insolvency in 2018, and it is yet to be seen whether it will lead to an appetite for legal or industry changes to prevent other company failures in future. In the meantime, insolvency should be considered when drafting your construction contracts, including defining insolvency properly, and understanding what steps you can take in the event of it happening, particularly as this varies depending on the standard form of contract used (JCT, NEC or FIDIC).
- More disputes – There has been a rise in construction disputes this year, especially in relation to remediation of defective works, building safety and insolvencies. It is a natural trend that when things are tougher in the industry, we see more disputes – and the industry has had several difficult years following the covid pandemic, Brexit, global supply chain disruptions, RAAC and more. We expect this to continue into the new year.
What to look out for in 2025?
On top of the events above, construction can expect the following developments in the new year:
Register for free and continue reading
This is not a paywall. Registration allows us to enhance your experience across Construction Management and ensure we deliver you quality editorial content.
Registering also means you can manage your own CPDs, comments, newsletter sign-ups and privacy settings.
Story for CM? Get in touch via email:
[email protected]
