The Must Know Guide to Construction Contract Principles

COURSE BACKGROUND

• This 1 DAY COURSE will consider the principles of contract law in practice and its application to construction contracts and administration, including an examination of main terms and conditions, sub-contracts, potential problem areas and risk factors to consider.

OVERVIEW

General principles of contract

• What constitutes a binding contract?
• What is a ‘construction contract’?
• Offer, tender, quotation, estimate, acceptance, counter-offer; acceptance by conduct
• Information and documentation to be provided to contractor/sub-contractor – its significance and contractual status
• When can a tender be revoked?
• Keeping a tender open
• Open invitations
• What are the contractual consequences of revoking a tender?
• Oral/written agreements

Mistake and misrepresentation

• The effect of mistakes and misunderstandings
• The nature of misrepresentations and pre-contract statements
• Errors in pricing/scope

Contract terms and conditions

• Express/implied terms
• Unfair contract terms
• Terms implied by statute – Sale of Goods, Supply of Goods and Services, The Construction Act, ‘Third Parties Act’ 1999
• Essential conditions that are desirable for both parties
• Standard forms of building contract – advantages and desirability
• Problems of non-standard forms of contract
• Different contractual arrangements – allocation or commercial risk
• Choose the right contractual arrangement

Sub-contractors, suppliers and third parties

• The contractual chain
• Assignment and novation – when appropriate
• Sub-contracts, named/nominated sub-contractors – risk and responsibility
• Concept and philosophy of sub-contracting; principal sub-contract conditions
• Suppliers

Problem areas

• Practical completion
• Slow/no progress
• Force majeure and the implications
• Extensions of time
• Late payment
• Finance/Interest: late payment of Commercial Debt (Interest) Act, 1998 and contract provisions
• Ownership of goods and materials

Elements of liability

• What are common law damages and how are they assessed?
• Liquidated damages or general damages for delayed completion?
• Provisions in standard forms of contract for recovery of loss and expense
• Claims at common law
• Design liability – standards and allocation
• Limitation of action
• Cause and effect
• Defects – latent/patent/correction
• Defects liability period

Termination

• How a contract can be terminated
• Rights of the parties on termination
• Importance of understanding obligations and responsibilities of the parties
• Mediation, Adjudication, Arbitration, Litigation

The New Construction Act

• Brief Review of the Local Democracy, Economic Development and Construction Act 2009 and its impact on payment and adjudication provisions.