Contract Administration

By Dr. Chandana Jayalath

The term good faith, bona fide in Latin, is used in many areas of the law but has special significance in law related to construction. It is expected that the parties to a contract will act in good faith and fair deal at all times. To meet this test, it is honesty that comes first in the conduct of the transactions in achieving a reasonable commercial standard of fair dealing in the trade. These standards are usually set out in form of specifications taken for granted in the industry. Accordingly, good faith incorporates both subjective elements by requiring honesty and objective elements by requiring adherence to standards. Although good faith and fair deal go together, it is bad faith, more easily recognizable so that a party may contest in a lawsuit when only a bad faith prevails. According to Lord Justice Bingham, good faith is in essence a principle of fair and open dealing where the parties should not deceive each other. …

Good Faith and Fair Dealing; What Does It Really Mean in Construction Contracts?Read More »

By Dr. Chandana Jayalath
Sub letting reduces dependency on directly employed labour. It results non-wage cost of employment such as redundancy payment and offsets the risk associated with the responsibility by transferring them. Sub letting is necessary when to employ specialists of proven reliability and repute to face technical complexity involved in a project. There are two distinctly different modes of sub letting that everyone is known to; domestic and nominated. …

Pros and Cons in Subletting, Designation, Assignment, Nomination and Novation in Construction ContractsRead More »

By: Dr. Chandana Jayalath

Losses can be recovered under two limbs namely the losses arise naturally, according to the usual course of things, as the result of the breach (first limb); or the losses that were contemplated by the parties, at the time the parties made the contract, as being the probable result of the breach (second limb). Consequential loss in construction contracts is equated with the second limb, as they are often be specified clearly in writing, such as payments to consultants during penalty period. …

Dealing with Consequential LossesRead More »

By Sachin Kerur and George Varma

The UAE construction sector is a continually developing market with complex transactions becoming increasingly prevalent. The evolution of the construction sector has highlighted the need for more robust construction contracts that deal with all the relevant risk issues for a project. …

Standard Form Construction Contracts – Friend or Foe?Read More »

By Sachin Kerur and William Marshall

In Part 1 of this two part subcontracting series, we detailed some tips and traps with respect to subcontracting, and considered the criticality of successful subcontractor performance to the timely and on budget delivery of projects. In Part 2 below, we examine the risks of pro-forma subcontracts and back-to-back drafting and briefly touch on the benefits of bespoke drafted subcontracts. …

Successful subcontracting – Part 2Read More »

By Sachin Kerur and William Marshall

Since Adam Smith first set his mind to the efficiency of the pin factory in 1776, specialisation and division of labour has underpinned industrial development. The construction industry has embraced specialisation and division of labour to such a degree that almost every construction project, no matter how large or small, is delivered in practice by a large number of separate parties, each with a narrow field of expertise and each with a commercial and practical imperative to maximise the efficiency within their field of expertise. …

Successful subcontracting – Part 1Read More »

By Patrick Bourke and Adam Vause

The most recent draft of the much anticipated UAE Federal Law in respect of Arbitration (the Draft Law) was released on 16 February 2012. The Draft Law represents the UAE’s proposed updating of its legislation in order to, among other goals, comply with its accession to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention) in 2006. Although the Federal Arbitration Law remains pending, this latest release demonstrates a positive step towards such a law coming into force and its contents should be considered when drafting arbitration clauses where the dispute could involve the UAE. …

Latest Draft of UAE Federal Arbitration Law ReleasedRead More »

The parties’ dispute concerned the extent of the coverage of this alternative design for demolition and hoarding works. The letter of award for the subcontract stated that it was to be a lump sum fixed price contract and back-to-back with the main contract. Brington maintained that Cheerise was responsible for the design as this was a back-to-back contract. …

Rights and Obligations under Back-to-Back ContractsRead More »

Now in its 25th year, FIDIC’s International Contract Users conference is indisputably the leading international forum for those wishing to make the most of the FIDIC suite of contracts.

Remain ahead of the field with exclusive, insider insights from the very people responsible for drafting and updating the contracts. …

Liquidated Damages is defined as “a sum which a party to a contract agrees to pay or a deposit which he agrees to forfeit if he breaks some promise and which, having been arrived at by a good faith effort to estimate in advance the actual damage which would probably ensue the breach, are legally recoverable or retainable as agreed damages if the breach occurs.” …

Liquidated Damages for Construction DelaysRead More »