London joint venture loses High Court battle with TfL

19/04/2018 | DOMINIC BROWNE

A joint venture working under the London Highways Alliance Contract (LoHAC) has lost a High Court battle with Transport for London (TfL) over work rates.

Colas, VolkerHighways and AECOM (CVU) disagreed with TfL over payment rates in conjunction with the capital's permit scheme, which imposes charges for working on roads during peak hours.

The joint venture argued that strict working time constraints placed on it by TfL's highways permit scheme delayed and prolonged work, requiring extra shifts and added costs.

CVU said it had understood there would be a window for night-time noisy works between 7.30pm and midnight but in practice this was severely curtailed by permit conditions.

CVU argued that it was therefore entitled to claim for the cost impacts of the restriction with revised rates and prices. TfL maintained that agreed rates and uplifts in the existing deal covered all limitations or restrictions on working conditions.

Justice O’Farrell said: 'CVU makes a valid point that the framework agreement does not contain definitive hours and other conditions in which the works under task orders must be carried out.

'That introduces uncertainty as to the duration, scope and cost of work required. Any requirement by CVU to price such uncertainties would result in uncommercial high rates. There is a risk that contractors could include a premium for the risk of uncertain restrictions on working if forced to price them at the outset.'

The judge added: 'However, that is balanced by the competitive tendering that applied for the framework agreement, and the volume and spread of works, from those at high risk of imposed restrictions to those at low risk of imposed restrictions. The inbuilt uncertainty introduced risk for both parties that could be assessed and evaluated.

'The purpose for which the schedule of rates was required was to provide consistency and certainty in the pricing of the works. The use of a schedule of rates enabled TfL to evaluate the tenders on a fair and equal basis. The fixing of rates and prices for the framework agreement provides opportunity and risk for both parties.

'If CVU undertakes the work instructed in a shorter duration or at lower cost than anticipated, it will receive a "windfall" and TfL will have "overpaid". If CVU incurs greater costs than anticipated, it will have to bear the loss and TfL will have made a saving.

'It was a matter for each party to assess the risks associated with permits issued and to price those risks accordingly.'

CVU is in talks with TfL about removing itself from core work under the LoHAC framework; however this relates to cut backs in Transport for London's roads spend and has nothing to do with this court case.

A spokeswoman for CVU said: 'CVU would like to reiterate that they are in discussions with TfL to consider stepping down from core work in the central London area. This action was agreed prior to the result of the recent court case being announced, and is in response to the removal of the government operating subsidy.'

Highways InProfile

latest magazine issue
Highways jobs

Project Lead - Bridges and Structures WMF3037e

£45,718 to £46,731
We are currently seeking to recruit a Project Lead to join our Bridges and Structures team Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Traffic Management Technician - WMF3040e

£27,711 - £28,624
Are you an organised and motivated individual who wants to make a difference to how our roads are managed? Cumbria / Various
Recruiter: Westmorland and Furness Council

Traffic Management Officer - WMF2114e

£37,035 - £37,938
Are you an experienced and motivated professional looking to take the next step in your traffic management career? Cumbria / Various
Recruiter: Westmorland and Furness Council

Senior Transport Planner

£47,532 - £50,574
Royal Greenwich is a borough synonymous with first class modern services Greenwich, London (Greater)
Recruiter: Royal Borough of Greenwich

Technician - Highway Inspector

Grade 8 £28,797 - £30,708 per annum (Pay Award Pending)
Within the Highways Maintenance Team we are looking for an enthusiastic, customer focused and experienced person to join the Service Derbyshire
Recruiter: Derbyshire County Council

Project Delivery Senior Team Leader

£74,480 - £85,964
Are you an experienced Chartered Civil Engineer (or equivalent professional qualification) Glasgow City
Recruiter: Transport Scotland

Assistant Traffic Management Technician - WMF2104e

£25,584 - £25,992
Westmorland and Furness Council is seeking an organised and enthusiastic individual to join our South Lakeland team Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Bulky Operative

£25,584.00 - £27,269.00, Grade 5, 37 hours, Permanent.
An opportunity exists in the Council’s Street Scene Services for a Bulky Operative Wakefield, West Yorkshire
Recruiter: Wakefield Council

Project Delivery Team Leader

£57,710 - £71,842
Are you an experienced Chartered Civil Engineer (or equivalent professional qualification). Glasgow City
Recruiter: Transport Scotland

Traffic Management Officer - WMF2102e

£37,035 - £37,938
This is a key role supporting the delivery a wide range of traffic and road safety schemes. Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Shared Service Manager (Waste) North Herts Council

£52000 - £61000 per annum
Shared Service Manager (Waste) North Herts CouncilNorth Herts CouncilPermanent, Full Time£52,866 - £61,866 per annum, plus car allowance (pay award pe England, Hertfordshire, Letchworth Garden City
Recruiter: Essex County Council

Traffic Management Officer - WMF2102e

£37,035 - £37,938
This is a key role supporting the delivery a wide range of traffic and road safety schemes. Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Assistant Traffic Management Technician - WMF2104e

£25,584 - £25,992
This is a key support role, helping to deliver a wide range of traffic and road safety schemes across South Lakeland. Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Flood Risk Engineering and Strategy Officer

£49,764 - £55,623
In line with our One Coventry Values, we want to ensure that our communities are represented across our workforce Coventry, West Midlands
Recruiter: Coventry City Council

Senior Integrated Transport Officer

£34,324 - £37,529
Are you an experienced transport planning professional ready to influence strategic policy and drive real change Matlock, Derbyshire
Recruiter: Derbyshire County Council

Roadworker Trainee LGV Driver (3 Posts)

Grade 6 £25,183 - £25,638 per annum (Pay award pending)
We’re looking for Roadworker/trainee LGV drivers to be part of our team undertaking major highway, bridge and related construction and reconstruction Derbyshire
Recruiter: Derbyshire County Council

Engineer

£44,430 - £51,663
This post is within the Highways Design and Delivery Team. London (Greater)
Recruiter: Tower Hamlets London Borough Council

Civil Enforcement Officer - WMF3013e

£27,711 -£28,624
Are you seeking an active and challenging role, part of a friendly and welcoming team? Cumbria / Various
Recruiter: Westmorland and Furness Council

UGO Bus Driver

Up to £25081.00 per annum
UGO Bus DriverPermanent, Part TimeUp to £25,081 per annum (full time equivalent)Location
Recruiter: Essex County Council

Head of Highways Operations

Salary
Somerset Council
Recruiter: Somerset Council
SUBSCRIBE NOW

Latest Video

Subscribe to Highways today to ensure you keep your finger on the pulse of everything happening in the UK road network throughout the year.

SUBSCRIBE NOW