Posts Tagged ‘law’

Can a Contractor Obtain Compensation for a Radical Increase in its Costs if a Construction Contract Contains No Price Escalation Clause?

Christopher R. Seppälä, Elizabeth Lefebvre-Gross

Faced with a drastic increase in the cost of commodities—for example, of steel, or oil—that undermines the economic assumptions of a construction contract, lawyers trained in the common law may believe that, if the contract has no price-escalation clause, the only relief from the contract available is termination on the grounds of frustration, impossibility, or impracticability. In fact, outside the common law countries, it may be possible to obtain other relief, including an increase in the contract price, to take into account changed circumstances after a contract has been signed. Several examples are provided below. (Read more..)

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Cost escalation

Cost escalation is one of the major issues currently affecting the construction sector in the region. There are regular press reports on the extent to which the costs of steel, cement and labour have risen. (Read more..)

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Caution: Contracts

by Dennis Brand

Ask a group of industry professionals to state what they believe to be the most important provision in a construction contract and you will probably get as many varied responses as there are people in the group.

Give the same group of people a copy of a standard form contract (e.g. FIDIC, ICE or JCT) to read with a form of Particular Conditions or similar attached, and invariably they will look first at the Particular Conditions and possibly no further. (Read more..)

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Take care when taking over

by Steven Hunt

I sense that, for many contractors, ‘taking over’ is seen as the moment when the proverbial foot can come off the gas – the time when the contractor is finally relieved of the burden of delivering the project.For a contractor the process of taking over is an important one as the care of the works will pass to the employer and the employer’s entitlement to recover liquidated damages will cease. It is not, however, the end of the story for the contractor as he will remain liable for defective workmanship and materials beyond handover. (Read more..)

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Governing actions

by Dennis Brand

In the construction and engineering sectors, while a proportion of contracts are prepared on a bespoke basis, the majority are based on an industry standard form. (Read more..)

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How does local law deal with liquidated damages?

The concept and mechanism of liquidated damages is well known and recognised throughout the construction industry in the Middle East.  (Read more..)

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How the law of liquidated damages can be applied in the local (Courts)

by Erin Miller Rankin
Liquidated damages provide a contractual means to predetermine a loss and they are generally used to penalise a contractor for delays – (Read more..)

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Bespoke choice

by Dennis Brand

A suit made by a bespoke tailor will fulfil all of a customer’s expectations regarding style, cut and fit, but it will be expensive. For this reason, most suits are purchased off-the-peg.

Today for the construction and engineering industry there are numerous off-the-peg or standard form contracts available from the UK and Europe. These are published by professional organisations and bodies including the Joint Contracts Tribunal (JCT); Institution of Civil Engineers (ICE), which publishes both the ICE and the New Engineering Contract (NEC); and the International Federation of Consulting Engineers (FIDIC). (Read more..)

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