Pre Action Protocol for Construction and Engineering Disputes.
The Pre-Action Protocol for Construction & Engineering Disputes (Second Edition): An Overview
Introduction
The Pre-Action Protocol for Construction and Engineering Disputes (Second Edition) establishes the framework that parties are expected to follow before commencing litigation in the courts in relation to construction and engineering disputes. Introduced in late 2016 and formally published by the Ministry of Justice in 2017, the Second Edition replaced the original Protocol, introducing significant reforms aimed at improving efficiency, proportionality, and access to early dispute resolution.
Purpose and Rationale
The principal aims of the Protocol are to encourage the early and open exchange of information, promote the prompt and cost-effective resolution of disputes, and, where possible, enable settlement without recourse to the courts. It reflects the overriding objective of the Civil Procedure Rules: to deal with cases justly and at proportionate cost.
By requiring parties to set out their cases in writing, consider alternative dispute resolution, and engage in constructive dialogue before litigation is commenced, the Protocol seeks to reduce the need for formal proceedings, narrow the issues in dispute, and, where litigation proves unavoidable, ensure that parties are properly prepared for the court process.
Scope and Application
The Protocol applies to all construction and engineering disputes in England and Wales, including claims involving building projects, contractual disputes, design issues, project management, and disputes concerning contractors, engineers, and related professionals. It does not, however, apply to every kind of claim; for example, disputes solely concerning residential occupiers, the enforcement of adjudicators’ decisions, or where urgent interim relief is required, are generally outside its ambit.
It is important to note that this Protocol is separate from, and operates independently of, the general Professional Negligence Pre-Action Protocol, which does not apply to construction professionals.
Key Features and Procedural Steps
The Protocol sets out a sequence of formal steps that parties should follow prior to the commencement of legal proceedings:
- Letter of Claim: The process begins with the claimant sending a detailed Letter of Claim to the defendant. This letter must summarise the basis of the claim, the relevant factual background, the key contractual or statutory provisions relied upon, and the remedy sought (such as damages, specific performance, or other relief). It should be concise, factual, and proportionate to the complexity and value of the dispute.
The Letter of Claim must also state whether the claimant proposes to use the Protocol Referee Procedure and identify any experts whose input may be relied upon. - Acknowledgment: Within 14 days of receipt, the defendant is required to acknowledge the Letter of Claim in writing. This acknowledgment should confirm receipt, indicate whether the defendant’s insurer has been notified (where relevant), and state whether the defendant agrees to use the Protocol Referee Procedure.
- Letter of Response: Within 28 days of receiving the Letter of Claim, the defendant must serve a Letter of Response. This letter should address each of the claimant’s allegations, stating which matters are admitted and which are denied, and the basis for any denial. The defendant may also raise any counterclaim and set out its own position on key issues and any experts it proposes to rely upon.
- Counterclaim Response (if applicable): If a counterclaim is raised, the claimant has 21 days to provide a written response addressing the matters raised.
- Pre-Action Meeting: Once the exchange of letters is complete, the parties are expected to attend a without-prejudice Pre-Action Meeting within 21 days. The objective of this meeting is to narrow the issues in dispute, explore the possibility of settlement, and agree on any further procedural steps if necessary. The format of the meeting is flexible; it may take place in person, virtually, or as part of a mediation process.
- Conclusion of the Protocol Process: Following the Pre-Action Meeting (or 14 days after the date on which it should have taken place, if one party refuses to participate), the Protocol process is deemed concluded. If no settlement is achieved, the claimant may proceed to issue court proceedings.
Optional Protocol Referee Procedure
A distinctive feature of the Second Edition is the introduction of the Protocol Referee Procedure. Where both parties agree, an independent Referee—typically a senior barrister or solicitor with construction law expertise—can be appointed to oversee compliance with the Protocol and resolve procedural disputes at the pre-action stage. While not binding like a court decision, the Referee’s recommendations may influence the conduct of the parties and can be placed before the court if one party is alleged to have acted unreasonably.
This procedure is voluntary and is generally used only in more complex or contentious disputes.
Flexibility and Proportionality
The Protocol is designed to be flexible and proportionate to the scale and complexity of the dispute. While it sets out standard timelines (e.g., 14 days to acknowledge, 28 days to respond), these can be extended by agreement between the parties in appropriate cases. The Protocol is not intended to cause unnecessary delay or cost; minor or technical breaches will rarely lead to sanctions, provided the parties engage with the process in good faith.
Sanctions for Non-Compliance
Although the Protocol is not legally binding in itself, courts expect parties to comply with its provisions as a matter of standard practice. Non-compliance, or conduct inconsistent with the spirit of the Protocol, may result in adverse costs orders—even where a party ultimately succeeds in the substantive claim. The courts have emphasised that sanctions for procedural failures will be imposed only in cases of flagrant or unreasonable non-compliance.
Interaction with Limitation Periods
Parties should remain mindful of limitation periods under the Limitation Act 1980. The Protocol expressly provides that compliance should not cause a claimant to lose the right to bring a claim. If adherence to the Protocol would risk the claim becoming time-barred, it is open to the claimant to commence proceedings to protect their position, and the court may stay the proceedings to allow the Protocol process to be completed.
Conclusion
The Pre-Action Protocol for Construction and Engineering Disputes (Second Edition) provides a clear and structured approach for resolving disputes in the construction and engineering sector. By setting out defined steps and encouraging cooperation, early disclosure, and the consideration of alternative dispute resolution, it aims to ensure that parties have every opportunity to resolve disputes efficiently and cost-effectively without recourse to litigation. Where proceedings do become necessary, compliance with the Protocol places parties in the best possible position to present their case before the courts.
For further information on the Protocol, or for specific legal advice relating to construction or engineering disputes, you should consult a solicitor experienced in construction law and dispute resolution.
For further guidance on the Construction & Engineering Pre-Action Protocol, or to discuss a potential claim:
Read our in-depth guide to the Pre-Action Protocol for Construction & Engineering Disputes
Learn more about Professional Negligence Claims
Guidance on Architects’ Negligence Claims
Contact Carruthers Law for advice or to make an enquiry
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Email: info@carruthers-law.co.uk