The Week That Was - 8 August 2025

Welcome to The Week That Was, a round-up of key events in the construction sector over the last seven days.

Construction and Engineering Law 2025

RPC are delighted to have contributed once again to ICLG's Construction and Engineering Law guide for 2025.

The comprehensive guide delves into the multifaceted world of construction and engineering law, providing an essential reference for understanding and comparing the handling of common legal challenges across various jurisdictions.  This year, the guide contains two expert analysis chapters, and 21 jurisdiction chapters, with the RPC team contributing one of each.

Our expert chapter, "The Increasing Importance of Statutory Rights, Duties and Remedies in English Construction Law", highlights recent legislative reforms and landmark court decisions - particularly in light of the Grenfell Tower tragedy - that are reshaping dispute resolution across the industry.  This chapter is authored by Alan Stone, Tom Green and Jonathan Carrington, who bring their extensive experience and expertise to the subject.

The jurisdiction chapter, authored by Alan Stone, Tom Green and Arash Rajai looks at construction laws and regulations in England and Wales.

Click here to read the jurisdiction chapter and click here for the full guide.

Housing association settles £15m claim against contractor

In October 2024, London & Quadrant Housing Trust issued a claim against Bouygues (UK) Limited in relation to flammable cladding on two high-rise buildings in London.  The buildings were constructed by Denne Construction Limited in 2010.  Bouygues acquired Denne in 2016 and assumed its liabilities as part of the sale and purchase arrangements.

According to public Court records, the Court sealed a Tomlin Order on 22 July 2025.  Bouygues provided a statement to Construction News confirming that "[a] settlement has now been reached by a multi-party agreement and all works have been completed. Due to confidentiality obligations, we are unable to disclose specific details. We remain dedicated to delivering quality construction projects and ensuring the satisfaction of our clients."

Click here to read more. 

Arbitration Act 2025 comes into force

On 1 August 2025, the Arbitration Act 2025 came into force, introducing several amendments to the Arbitration Act 1996 including (i) clarifying the default law applicable to the arbitration so that this is the seat of the arbitration, absent express agreement by the parties; (ii) new summary dismissal powers for faster resolution of claims with no real prospect of success; (iii) clarifying that arbitrators are immune from incurring liability for their resignation where such resignation is reasonable; (iv) codifying an arbitrator's duty of disclosure in respect of potential conflict; and, (v) new rules applicable to jurisdictional challenges.

Given many construction contracts, such as those governed by the JCT suite of contracts, may contain 'arbitration clauses' that require disputes to be referred to arbitration, the provisions of the Arbitration Act 2025 are likely to be highly relevant to the construction sector.

Read more about the Arbitration Act 2025 here (last updated on 24 February 2025).

Government considering ban on retentions in new late payment crackdown

The Government is taking steps to crack down on late payment of invoices, which is purported to cost the UK economy £11bn per year.  

A consultation document suggests that Part 2 of the Housing Grants, Construction and Regeneration Act (1996) will be amended, introducing requirements on the use of retention payments in the construction sector. One proposal would see an outright ban on the withholding of cash retentions; however, an alternative proposal would see the greater protection of retained funds from insolvency and late non-payment.

Other proposals include the accrual of mandatory statutory interest on late payments. This means that parties will no longer be able to negotiate compensation rates lower than the statutory rates. A further proposal will see the maximum payment period reduced from 60 days to 45 days. The Government's consultation will run until 23 October 2025.

Click here to read the consultation.

Reform of Building Safety Regulator

The Ministry of Housing, Communities and Local Government (MHCLG) has proposed a significant reform package aimed at reforming the Building Safety Regulator (BSR). The main aim of the reforms is to reduce project delays and promote the construction of residential home building.

A new fast-track review process, strategic leadership changes and investment in regulatory capacity are amongst the proposed reforms. The new fast-track system will bring building inspectors and engineers into the BSR, with the aim of expediting decisions on new builds and remediation projects. The BSR will also be provided with additional resources, and has pledged to hire up to 100 new staff members to support its activities.

Click here to read more.

With thanks to Charlie Underwood, Zack Gould-Wilson and Charlie Edwards.

Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice.  We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date.  You should seek legal or other professional advice before acting or relying on any of the content.