Archive for the ‘Contract Administration’ Category

Managing Payment Delays on International Construction Projects

(The following outline was used in a presentation to the Overseas Construction Association of Japan, Inc. (OCAJI) The Dynamics of Payment

As a construction project moves toward completion, the Contractor loses leverage, and the Employer gains leverage.

This is based on the reality that the Contractor builds the project, and the Employer simply pays money. As the project nears completion, the Contractor has less leverage because the Employer is close to obtaining what he bargained for – a completed project. This is the time when the Employer will be inclined to suspend or reduce payments to the Contractor, not early in the Project.  (Read more..)

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Consultants’ Fee Claims To Be Time-Barred in the UAE

By Michael Grose

As the fifth anniversary of the onset of the financial crisis approaches, engineers, architects and other consultants to the construction industry should be aware of the potential risk that this unhappy anniversary presents to any remaining fee claims. Whilst any expectation of payment at this late stage is likely to be low, any optimism that early signs of returning confidence might provide a chance to cash in old debts should take into account one of the more obscure time limits applicable under UAE Laws. (Read more..)

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Construction Law Summer School – IBC Legal’s 13th Annual Conference

“An international fiesta for construction industry professionals.”

 Join your international peers at IBC Legal’s most comprehensive construction law event for 3 days of intensive learning and networking

Construction Law Summer School – IBC Legal’s 13th Annual Conference

3rd – 5th September 2013 – Downing College, Cambridge University, UK

CMguide readers get a 10% saving (

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Top Tips For Handling Disputes In The UAE

by Richard Bell and James Fox

No business wants to enter into a dispute. Disputes are often costly, tie up management time and distract staff from profitable work. In the UAE where a civil dispute is sometimes accompanied by a criminal complaint, a dispute can have a significant impact on key staff, including travel bans and the stress of facing criminal charges. Taking the right action from the beginning of a dispute can help to resolve the dispute faster, more efficiently and at less cost. (Read more..)

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Bridging the contractual gap between an employer and a sub-contractor in the UAE

By Eric Teo

What are the rights of an employer in the event a nominated sub-contractor fails to deliver the standard or quality of material and workmanship that the employer had expected to receive? Common wisdom dictates that the employer would ordinarily seek recourse against the main contractor for the sub-contractor’s failure, but are there any alternatives?

To answer the above question we need to firstly understand that there are, in practice, two types of sub-contractors: domestic sub-contractors and nominated sub-contractors. Secondly, we should examine the contractual relationships between the three parties, i.e. the employer, the main contractor and the sub-contractor. (Read more..)

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Limit of changes that can be introduced under variation provisions!

by Dr  Chandana Jayalath

Changes are inevitable in any construction therefore the parties are provided a flexibility to make changes to the work under a typical contract changes clause. However, the ability for owner requested changes, even if provided in the contract, are not without limitations, restrictions as well as consequences.

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FIDIC Asia-Pacific Contract Users – take a look at these 6 great reasons to attend

FIDIC’s 5th Asia-Pacific Contract Users’ conference is taking place on 11th & 12th June in Malaysia (workshops on 10th & 13th June).

If you’re involved in this region then you won’t want to miss out! Take a look a look at these 6 great reasons to attend:
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ICTAD Price fluctuation Formula; Clarifying The Context in Which It Operates

 by Dr. Chandana Jayalath*

  The provisions of price adjustment on account of increase or decrease in costs of goods and services in construction contracts are practiced World over to have more realistic competitive bids and execution of contracts on just and equitable manner. Prices of materials, plant and labour are highly variable due to fluctuations in the currency market. Construction experts, therefore, thought it prudent to compute the cost of contracts on present price, keeping provisions of price adjustment for probable fluctuations. The Institute for Construction Training and Development (ICTAD) of Sri Lanka has undertaken among others, the standardization of “country specific” documents to regulate and streamline the administration of contracts. The Formula Method for Reimbursement of Price Fluctuation is one such initiative to offer a reasonable basis for calculating price adjustment for construction contracts.

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N is for the Novation

By Suzannah Newboult

When a party is substituted for another party to contract and assumes the original party’s rights and/or obligations, it does so either by way of ‘novation’ or ‘assignment’. Party A contracts with Party B. Party C is substituted for Party B. The contract is now between Party A and Party C.

If the substitution has occurred by way of novation, then the original contract is effectively replaced by a new contract on the same terms as if the new party, (Party C in the example above) was party to the contract from the outset. (Read more..)

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The effect of concurrent delay on an extension of time claim

Rebecca Evans, solicitor with Thomas Eggar LLP, reports on a case that offers good news for contractors in England.

A recent case, heard by Akenhead J in the Technology & Construction Court in London, has practical consequences for contractors: the effect of concurrent delay on an extension of time claim.

Walter Lily Company (WLC) was employed by DMW Developments Ltd (DMW) to construct a substantial house in the Boltons in London. DMW was the corporate vehicle for Mr and Mrs Mackay. The architects were Barrett Lloyd Davis Associates (BLDA). The work started in 2004 with the initial projected timeframe of 18-20 months. (Read more..)

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