Scottish vs English Construction Contracts

It would be reasonable to assume that the location in which construction works are taking place would dictate which form of contract and governing law is chosen.

For example, using a JCT Standard Building Contract for a construction project in England and a SBCC Standard Building Contract for a construction project in Scotland.

However, our experience is challenging that assumption, as we are increasingly seeing a mixed approach being taken – whether that’s an English standard form contract governed by English law being used in Scotland or vice versa. The former is more common in our experience.

The decision to use an English contract for a Scottish project (or vice versa) can be driven by several factors. The primary driver is typically familiarity with the type of contract and experience of a particular governing law.

On the face of it, choosing a familiar form of contract can create efficiencies. The parties may have negotiated the terms previously and are already comfortable with the respective risk profiles. The choice of contract can, however, present risk factors that should be considered at the outset of any project. For example, the differences in some key areas including time bar, dispute resolution, third party rights and title to goods or materials as between Scots law and English law, can all present complications. The recent building safety legislation has additionally brought a particular focus on potential issues that may arise as a consequence of following a mixed jurisdictional approach, given the substantive differences in building safety regimes north and south of the border.

Parties should exercise particular caution when considering the application of building safety legislation and statutory and technical requirements more generally. It is important that parties are aware of their obligations under relevant legislation, which can arise irrespective of the governing law or form of contract. Such issues may affect the marketability of the completed project and can lead to more protracted and costly diligence processes where third parties become involved.

If using a particular form of contract is the overriding preference of the parties, it is not uncommon for the contract to be converted to the appropriate local form and/or governing law given the location of the project. This can be a helpful way of mitigating the potential risks discussed above.

A number of our Construction & Projects team are qualified in both Scotland and England & Wales. If you require any advice in relation to the issues mentioned in this article, please do get in touch with us - we would be happy to help.

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