Ofcom consults on changes to the universal postal system
26 January 2024
Yesterday, Ofcom launched a consultation in to the future of the universal postal service. In our personal lives, few of us are sending letters regularly, and still fewer of us would care much as to the precise day the letter is delivered. Yet in business, and the construction industry in particular, there are still circumstances where changes to the postal system could create contractual awkwardness.
Contract management
The industry has, for the most part, moved over to email and portal-based communications. However, there are still certain contractual obligations which must be complied with through use of the postal service. As standard, the JCT forms of contract contain a provision which provides for service of notices by “any effective means”, but which confirms that postal service will always be effective. For some critical notices, such as notices of specified default or termination notices, the notice must be given by hand or by recorded or signed for post. Reliance on post in this way is common across many standard form and bespoke contracts.
To continue that example; using the JCT Design & Build 2016, clause 8.4.2 enables the employer to terminate the contractor’s employment under the contract if the contractor continues its default for a period of 14 days after the date of receipt of the notice of specified default. If the Government approves the proposed changes:
- a three-day a week postal service could materially change when that notice was actually received by the Contractor; and
- it might also limit the Employer’s time for deciding to terminate, as the termination notice would be effective on receipt by the Contractor, but must be given on, or within 21 days from, the date of expiry of the 14 day period. Unless the Employer can arrange to deliver the termination notice by hand; it might have to send the notice earlier under a more restricted postal service.
It is only the perceived reliability of post which, until perhaps recent years with the impact of postal strikes, has kept it relevant – as well as concern about emails sat languishing unanswered in inboxes where the addressee is absent. If such drastic changes are made, will we see the abandonment of post as a contractual means of service altogether, and the more universal uptake of email?
Given how the COVID-19 pandemic forced companies into increased remote working patterns, and we are at our ‘desks’ less, the importance of hard copy documents as physical reminders has undoubtedly reduced. It would be sensible for those managing and administering contracts to create project specific email addresses and specify that as being the email address for service of notices, so that no one person has the burden and responsibility of responding to notices on time!
The Government seems averse to agreeing any change in the Universal Service Obligation, but given the consultation and apparently stark financial position for Royal Mail, it seems sensible that those negotiating project documentation now give some thought to how their contracts will adapt if the level of service does change.
Disputes and Court proceedings
If and when disputes arise, mostly adjudication prevails in a construction context and post is therefore irrelevant. It is vanishingly rare for adjudicators to demand hard copies of documents nowadays, and even where they do, it is only as a follow up to an electronic copy. Court proceedings are less advanced.
Absent a specific agreement, Court proceedings cannot be served by email, so post yet again constitutes the default mode of service unless you are able to effect service in person. The Civil Procedure Rules provide for deemed dates of service for proceedings served by post, normally the second business day after posting. Might that deemed service have to change in a world where the postal worker does not ring quite as often?
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John Fawcett
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Katrina Bretten
Services
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at January 2024.