18 Nov 2016

New Pre-Action Protocol


What you need to know

A new Pre-Action Protocol for construction and engineering disputes replaces the old Protocol which has been with us since October 2000. The new Protocol introduces significant changes that are designed to make it quicker and less expensive to follow. You are now free to agree not to use the Protocol if you wish. There is also a new voluntary procedure for the appointment of a Protocol Referee. However, by softening the obligations in the Protocol, the chances of early settlement may be less likely and there is more scope for unwilling parties to refuse to engage meaningfully in the process. Nevertheless, the focus on cost control, proportionality and party choice is to be welcomed.


The Technology and Construction Court (TCC) has long held a reputation for innovation in court processes and it was instrumental in creating one of the first Pre-Action Protocols which applied to construction and engineering claims from October 2000. The objective of the Protocol was to encourage the early exchange of information, to promote early settlement of claims and to support the efficient management of litigation.

The Protocol has met with mixed enthusiasm. Some were concerned that it substantially increased the time and cost of proceedings by requiring parties to carry out work in the Protocol phase that would be duplicated after proceedings were issued. Others considered that the Protocol, when followed sensibly, successfully promoted early settlement and led to a saving of costs. Certainly, the effect of the Protocol was to front load the cost of proceedings to a greater extent than under the old rules.

These concerns led the TCC in conjunction with TECBAR and TeCSA to undertake a full review of the Protocol after consultation with Court users including litigants and their advisers. The outcome is a new Protocol which seeks to reduce the time and cost involved in following the Protocol whilst retaining a focus on early case settlement.

Key changes

  • Unlike the old Protocol, you may opt out of the new Protocol if all parties agree. This is a sensible reform allowing flexibility and promoting party choice. It will have obvious attractions for claimants but perhaps less so for defendants. In multi-party claims the prospect of all parties agreeing to dispense with the Protocol is more remote still.
  • The Protocol objectives have been amended so that the parties no longer need to provide "full" information about their case. Instead, they must give sufficient information to allow the other party to understand their position and make an informed decision about settlement including the use of ADR. The general aim of the Protocol has been modified so that only an “outline” of the parties’ cases is required. It is no longer necessary for the issues between the parties to be defined and agreed. The new Protocol seeks to put the parties in a position where they are able to settle cases not just early and fairly, as under the old Protocol, but also inexpensively.
  • The requirements of the claim letter have been simplified so that it need only contain a brief and proportionate summary of the claim and experts’ reports are neither expected nor required although they may in some cases be helpful. The requirements of the response letter have also been simplified so that only a brief and proportionate summary of the defendant’s response is needed together with a brief summary of any counterclaim. This is another sensible reform and it will hopefully cut down on the length and cost of claim letters and responses under the new Protocol. There is no reason to prepare a full statement of case.
  • The obligation placed on the parties to meet formally on at least one occasion before starting proceedings has been changed to an aspiration that the parties will “usually” meet.
  • The time allowed for the Protocol process has been shortened by limiting extensions of time for any step required under the Protocol to 28 days in total. Previously, the 28 day time limit for sending a response letter could be extended to a maximum period of 3 months and there was no hard deadline for the pre-action meeting.
  • Under the new Protocol, the process will be concluded (and proceedings can be issued) at the completion of the pre-action meeting or 14 days after expiry of the period within which the meeting should have taken place; that is 35 days after the defendant’s response letter is (or should be) received by the Claimant or, where a counterclaim is made, 35 days after the claimant’s response letter is (or should be) received by the Defendant.
  • The consequences of non-compliance have been softened under the new Protocol. The Court will only impose cost sanctions in exceptional circumstances such as in cases of flagrant or very significant disregard for its terms. It is not clear how the Court will interpret this new approach and it is to be hoped that parties will still be expected to abide by the spirit of the Protocol to avoid it becoming a pointless exercise.

New Protocol Referee procedure

The new Protocol introduces an entirely new and voluntary Protocol Referee procedure. Parties who sign up may seek directions from a Protocol Referee to assist them in complying with the Protocol and to seek help in resolving any non-compliance. The appointment process will be administered by TecSA. The procedure is set out in a separate document from the Protocol and imposes short time limits for written submissions by both parties and the Referee’s decision.

The procedure states that the decision is binding on the parties but not final and in any subsequent proceedings the Court is simply required to give “due weight” to it. There is no provision for enforcement of the decision and so it is unclear what a successful party can do if the unsuccessful party refuses to abide by the outcome save to refer the Court to the non-compliance in subsequent proceedings. The Referee has power to order the application fee of £3,500 is reimbursed to the applicant. The procedure is silent on the parties’ legal costs in connection with the application although presumably they will be treated like all other costs incurred by the parties in the pre-action stage and recoverable as costs in the case.

The advantages of the new procedure are not immediately obvious. There would seem to be little if any benefit for defendants; as for claimants, they will probably be better off starting proceedings in the face of non-compliance by the defendant rather than spending time and money on a satellite dispute. It remains to be seen whether there is significant take up of the Protocol Referee procedure.



Paul Thwaite

Paul Thwaite

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