Construction Contracts Act becomes law

Louth Senator Ged Nash and former Dublin Senator Fergal Quinn have addressed representatives from Ireland’s leading construction firms during an event hosted by the Construction Industry Federation (CIF) at Leinster House.  The event marks the introduction of the Construction Contracts Act into Irish Law.  Both Senator Nash and Mr Quinn were instrumental in bringing this vital piece of legislation to fruition over the past seven years.

Speaking at the event, CIF Director General Tom Parlon said: “The Construction Contracts Act is the single most important piece of legislation for Irish construction companies that has occurred in recent years.  Its enactment will regularise cash-flow for companies, reduce cost burdens, and provide rapid resolution of disputes. It is extremely positive news for our industry and will mean more certainty of payment for the entire construction supply chain.  All of this means that companies are now free to focus on the task of rebuilding Ireland and providing cities and regions with much needed infrastructure.

“I wish to thank both Senator Nash and Mr. Quinn for their dedication over the past number of years in ensuring the reality of this legislation.  Our industry has worked closely with both politicians, as well as Senator Paudie Coffey, Willie Penrose and the late Brian Lenihan, to facilitate its enactment into Irish law.  Today is a significant day for our industry.”

Senator Nash stated: “This act has the potential to transform the entire construction industry. It aims to regularise the relationship between parties and will facilitate a robust sustainable construction sector that will meet the needs of our growing economy and increased housing and commercial demand. This brings certainty in terms of payment between contractors and sub-contractors and will mean more effective planning and costing for construction companies and the public and private sector organisations executing projects.”

Fergal Quinn said: “I am delighted to see the Construction Contracts Act coming into law from July 25th.  I have dedicated much time in the course of the past seven years in ensuring this pivotal legislation for the industry becomes a reality.  From Monday onwards, the conditions of this act will apply in construction contracts and this will provide a platform for sustainable growth in this critical domestic industry. I would like to acknowledge the role played by the CIF in supporting this act and promoting it amongst its membership.”

The Construction Contracts Act will enter into law on July 25th. It provides new minimum contractual provisions concerning payment arrangements between the parties to a construction contract, subject to some exceptions. Where payment disputes do arise between the parties to a construction contract, either party will have the right to refer the payment dispute for adjudication, which will be concluded within a set timeframe. Where the parties cannot agree on an adjudicator, the Chairperson of the Ministerial Panel of Adjudicators will appoint an adjudicator from that Panel to the dispute.

This follows on from the appointment of Dr Nael Bunni as Chairperson of the Panel of Adjudicators last July, and the subsequent appointment a Panel of Adjudicators in December. These trained individuals will engage with all parties in a dispute, reducing legal costs and expensive delays in construction.  Most recently, Minister of State for Employment and Small Business, Pat Breen, released a Code of Practice for Adjudictors on the Panel.

CIF will be providing high-level training and briefings, to prepare companies for the new legislation.

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