LEGAL ADVICE
ADRIAN KERR AND CONNOR MULLIGAN FROM CONSTRUCTION LAW EXPERTS AND CEF PATRONS, MILLS SELIG DISCUSS LIKELY CONTRACT RAMIFICATIONS OF RED DIESEL REFORM…
F rom April 1, 2022, the construction industry, along with many others sectors, will face a serious blow from the new restriction on the use of “red” diesel introduced by the Finance No 2 Bill 2021. Many in the construction industry are questioning how they will be legally affected by the changes in light of ongoing or future construction contracts.
Reddiesel reform– what will itmean for your business?
change? Changes in the law under JCT give no entitlement to money. This will inevitably be frustrating for contractors as, given the increased costs of using white diesel, money is perhaps more pivotal in relation to the change in law. NEC In the context of NEC contracts, X2 is an optional additional clause which parties may have selected, meaning that any change in law in the jurisdiction where the site is located after the Contract Date is a Compensation Event thereby potentially entitling contractors to time and money. Project Managers may notify the Contractor of the change in law; however, the Contractor should also notify the Project Manager under Clause 61.3, otherwise contractual entitlement to time/money may be lost due to the frequently
JCT CONTRACTS In relation to JCT Design &
Build 2016, under Clause 2.26.12, contractors will be entitled to claim that a Relevant Event (for time) has occurred if the law has changed after the contractual Base Date. However, one must query how useful an entitlement to additional time will be in relation to transitioning away from red diesel. Will it be possible to put forward a legitimate, critical path-based time claim as a result of this law
Adrian Kerr, Head of Construction and Partner.
Conor Mulligan, Solicitor.
18 | NI BUILDER
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