CPA Bulletin

www.cpa.uk.net CPA Bulletin > May 2020 47 Q&As: 1 q & a s Since the outbreak of the Coronavirus, we have a few customers asking what the position is for plant we supplied themunder the Model Conditions, which has had to remain on their site. Can you help? In light of the current situation with the Coronavirus, sites may be shut down by either the client or Government with little or no notice. If you are concerned about any plant which may remain on site, and the contract was made under the CPA’s Model Conditions, then you should review the following four key clauses: 24(a), 23(b), 25 and 13(b). Please note that these clauses stipulate the Member’s position from purely a contractual point of view. We understand that this situation is unprecedented and outside the scope of normal contractual arrangements. Members may deviate from the strict contractual position should they wish, particularly when charging the customer during this period. The correct course of action will need to be assessed for each set of circumstances, and should consider: • How long the site may be closed for (some sites are closing for short periods while the work is re-programmed and re-organised) • Whether the customer has hired-in plant insurance that will continue during shutdown • The practicality of collecting the plant, in line with government advice that construction work can continue, provided it is done in line with the current Standard Operating Procedures published by CLC (available on the CPA website). CPAModel Conditions: • You may have an instance where your customer wishes to ‘off-hire’ the plant immediately, but clause 24(a) requires the customer to give seven (calendar) days’ notice, if the hire agreement is for an indeterminate (open-ended) period. After receiving the ‘off-hire’ notice, you should remove the plant within those seven days, if this is possible. However, if the plant is not available for collection, e.g. because the site has shut down, then the plant remains on hire as per clause 23(b), and the customer is charged accordingly. • Under clause 25 of the Model Conditions, the customer can be charged two-thirds of the hire rate. If you are supplying an operator with any plant, then refer to the “All-in” rate in the final line of that clause. • Certain items of plant and equipment, e.g. generators, lighting towers, etc., may still be utilised by the customer during the shutdown, and may be charged at the full rate. • Whilst the plant is still in the customer’s care during this period, then clause 13(b) would apply. If the customer has ‘hired-in plant’ insurance cover, this should address any losses or damages to the plant, should they occur during this time. As aminimum, the plant-hire company and customer should try to reach an agreement whereby: 1.The plant remains on hire during the closedown period. 2.The hire company charges an agreed rate (this may be significantly less than the 2/3 rate allowed in the CPA Model Conditions). 3.The contract and its conditions therefore remain in force. 4.The customer remains responsible for safety and security of the plant while it is on site. 5.If the plant is to be collected, the hire company and customer will agree when and how this will happen, and the customer will allow access to the plant. I hope this clarifies your position. Please forward this on to your customer should there be any misunderstanding as to their position. q A With regards to the Coronavirus pandemic, we acknowledge that no clear and hard rule can be made which will apply in all circumstances. The construction industry is talking with Government about these issues, and more guidance may become available at short notice. We will publish any revised guidance as soon as possible.