Relating to the Contractual Remedies - Report Example

Law Table of Contents Introduction 3 Report to the Contractor 3 Notice of [Intention to Seek] Adjudication 6 Brief Report to the Contractor 11 Conclusion 12 References 13 Introduction Modern-day disputes in the workplace scenario have become a common phenomenon throughout the globe. In workplace, several conflicting situations arise owing to varied discrepancies and perceptual differences persist amid the people. In this regard, one of the most common dispute scenarios in workplace can be reckoned as contract-based agreements, which creates imbalances in work situations in the form of creating disagreements amongst the contractors and the employers (Eggleston, 2015). Keeping in mind the rising concerns about the ill effects of such conflicts, the essay aims at addressing certain objectives for managing such situations. The essay attempted to highlight the available forms of non-litigious dispute resolutions that are available for the concerned parties and develop a conceptual understanding about the procedures that need to be adopted for the settlement of the disputes. Report to the Contractor This report aims at providing solutions to the contractor for the present dispute and also advising the validity of his claims. In this regard, certain assumptions have been duly considered for the above stated purposes. One of such assumptions is to establish and maintain the contact persisting between the legal advisor and the contractor with the involvement of media. This particular assumption has been mainly taken into concern for gathering and analysing adequate information about the happenings of the situations. From the analysed information, it can be found that the conflict took place owing to the delay in time taken by the contractor in the construction work. This resulted in making the contractor to have discussion with the employer concerning the assessment of Contract Administrators (CAs) associated with extensive level of variations, bad weather and general delays. Observably, the contractor has made number of intimations to the CA, prior to and during the construction work. The intimations were neglected by the CA, stating that the claims of the contractor cannot be duly considered. This resulted in creation of conflict. However, there exist certain options for the contractor that can be used by him in order to save himself from the levied charges (Bailey, 2014). It can be derived from the situation that the employer has not mentioned any specific date; hence, the liquidated damages cannot be levied upon the contractor at the first instance. In addition, a contractor is liable to pay the damages, only if the extended time is valid to a considerable extent. In the above situation, it can be apparently observed that the extended time was inadequate, owing to the prevalence of climatic conditions and general delays. Furthermore, the contractor can take action against the CA in case of any deduction made for liquidated damages, as the CA has not furnished the requirements for charging fines on damages. The contractor can show the proof that ‘breach of contract’ did not occurred. Furthermore, the contractor might take certain actions in case of partial possession. This can be introduced in order to reduce the fines, as the contractor has already completed a number of projects before his deadline ended (Pinsent Masons LLP, 2011). While establishing the fact that Liquidated Damages (LD) would be levied in case of ‘Breach of Trust’, the value of the LDs would be amounting to ‘nil’. Furthermore, fines and damages cannot be levied upon the contractor, in case; the contractor has already mentioned the extension of time owing to certain factors such as unfavourable climatic conditions and delayed progression. In this case, the contractor needs to maintain adequate records of data, serve notice period for extension and claim within a reasonable time prior to the completion of the project. Apart from these, he can also take actions against the CA, as whenever, the CA committee inquired for the relevant documents, the contractor was able to provide so. Hence, the contractor is eligible to receive the extended timeline for construction and his claims need to be addressed accordingly (Alnaas & et. al., 2014). The claims are well suitable relating to time and costs in association with the delayed construction work. Identifiably, the CA wrongly considered the claims, as these were made at the right times by the contractor. These claims cannot be disregarded, as the contractor with the help of such claims, was able to found that the construction work was delayed because of which it could not be completed within the prescribed time limits. Furthermore, the claims would be supported by the contractor’s ability in preparing reports with regards to the additional costs incurred during resolving the problems of construction. The claims were valid on the part of the contractor, as he was able to notify and submit all the requisite documents as well as records prior to the completion of the project. In addition, the duty to differentiate amongst the claims of time extension and costs associated with delays was also fulfilled by the contractor, which eventually validates both the claims (Pinsent Masons LLP, 2011). Additionally, the CAs disregarded the claims, stating that these do not comply with the requisite standards. However, an important point to note that if the claims were not appropriate, then why the contractor provided options to continue the work as per the provisions. This depict that the CAs were underestimating the standards of the contract. The contractor must be paid in full, as the CAs possess the authority to deduct fines only in case of breach or non-claims prior to completion of the project within the stipulated time. The claims of the contractor were deemed to be valid, as these included the changes in work schedule, daily and weekly reports apart from the cost requirements. Hence, in big projects such as creation of hypermarkets, there is indeed a space for delay in work. Hence, the validation is supported by the occurrence of uncontrollable disasters or problems, which happened in this situation, owing to which the contractor’s claims were acceptable enough. Both the claims were valid, as the contractor also maintained ‘contemporary records’ with the purpose of authenticating such claims. Moreover, the validity of the claims is strengthened by the evidences of the bad weather reports that were already submitted by the contractor (Gould, 2008). Notice of [Intention to Seek] Adjudication Between Contractor Company Name And Employer Company Name The applicant (Contractor), hereby, forwards notice of adjudication with the intention of addressing the dispute in accordance with the respondent party. a) Details of contract The contract dated XXX involved the construction of a substantial out-of-town hypermarket in the outskirts of ABC town. A copy of the contract has already been submitted with the concerned parties involved with the project. The contract employed 200 workers with a period of 1.5 years on a contractual basis. Owing to unfortunate circumstances, the contraction work has delayed by more than 12 weeks. Claims have already been provided to the CA committee with respect to increase in time and cost limits (Crown, 2001). b) Brief description of the dispute The responding employer party has introduced statements of deduction of 25, 000 per week for a total of 12 weeks, owing to the delays in work. Moreover, the party has disregarded the time and money claims provided by the contractor company, which had earlier been furnished from the contractor owing to delay in works. c) Details of where and when the dispute has arisen Where- Construction site address. When- Dated XXX. The dispute occurred at the construction site on XXX day. The project started on XXX, the delays occurred on XXX and the claims were made on XXX. The date of dispute crystallization was XXX. Date of certification of project was XXX and the date of notice for set-off was XXX. The deadline date was XXX and the submission of documents along with other records was XXX. d) Contracts in relation to the case and in favour of Contractor The contracts were in accordance with the stipulations of the Scheme for Construction Contract. Provisions of the contracts that governed the contractual rules in the UK are the ‘Housing Grant, Construction and Regeneration’ (HGCRA) 1996 and the ‘Scheme for Construction Contracts’ (SCC) 1998. The HGCRA applies over all the contracts of construction within England. Based on the present situation, the contractor has made necessary claims owing to the fulfilment of certain requirements of the HGCRA. As per the Act, the contractor has furnished notice of adjudication, as it allows one of the parties to do so at any point of time. The contractor was also able to forward a schedule for the purpose of securing engagement of the adjudicator as well as providing him evidences about the dispute within seven days. Furthermore, as per the requirements of the adjudicator, the contractor was able to provide the required documents within the stipulated period of 28 days, as per the Act. The contractor was also provided the opportunity to extend the period of 28 days by 14 additional days, which the contractor did not required as he had already published the facts within time. Furthermore, as required by the contract, the contractor acted impartially. The adjudicator was allowed to take up initiatives in order to search for facts, which he found in favour of the contractor. The ‘Scheme for Construction Contracts’ (SCC) 1998 is mainly introduced wherein the construction contracts are not in accordance with the requirements of Sec 108(1) to Sec 108(4). The provisions, as stated in Part 1 in accordance with Sec 109, Sec 111 as well as Sec 113 of the SCC Act, are applicable mostly in two cases. The first case relates the situation wherein the involved parties are unable to reach into a valid conclusion. Secondly, the provisions get apply in certain situations at the time when the constructional contracts do not contain provisions that are framed within Sec 110. All the provisions must be in accordance with the Section 114 of the HGCRA. The SCC takes place after completion of 8 weeks from the date of initiation. e) The remedy sought The adjudicator sought to determine that the claims must be duly considered and notification of levy of files must be disapproved. Furthermore, compensation needs to be paid to the contractor to mitigate the losses or else provide additional time without surplus charges. In case of remedy associated with money, the sum will be £XXX, as per the adjudication. In case of time addition, the time will be XXX weeks. The interest on outstanding sum will be £XXX. f) The names and addresses of the parties Referring Party Mr. ABC, Contractor in Charge XXX Group Wards No XX, Colony XX. Responding Party Mr. XYZ, Company CEO, Ward No XX, Colony XX. Dated: A specific notice of adjudication from a recent company has been attached hereunder for having a clear understanding about the stated context. Source: (Intuit, Inc., 2014) Brief Report to the Contractor The main consequence of the situation can be reckoned as that the contractor will not be levied with any additional charge and fine in accordance with the established Acts of contractual agreements. The contractor can furnish the acknowledgement slip to the Act office, who can take action against the CA committee and relieve the contractor form the charges. Specially mentioning, the claims along with the necessary documents and reports would be submitted to the Act office for the purpose of verification, which would transfer the liability to pay dues from the shoulders of the contractor to the employer. The contractor can further take additional steps against the CA committee for avoiding adjudication and non-adherence of the standards as per the Act. One of the relevant law cases wherein the adjudicator ruled the decision in favour of contracts was ‘Temloc Ltd vs. Errill Properties Ltd, (1987) 39 BLR 30’, in which the adjudicator held that ‘nil’ damages were being payable for LD, in case delay in completion of work is witnessed (Bailey, 2014). The other cases including ‘Bremer Handelsgesellschaft mbH v Vanden Avenne Izegem PVBA [1978] 2 Lloyd’s Rep 109’ and the ‘City Inn Limited v Shepherd Construction Limited (2002) SLT 781’ witnessed that the decisions were taken in favour of contractor. The respective contractors in these cases were able to justify that the provisions for time and costs incurred were adequately maintained and the prerequisite targets were fulfilled (Gould, 2008). Conclusion Based on the above analysis and discussion, it is to be affirmed that the contractor cannot be charged with fines for having delays in work. The main reasons based upon which he cannot be charged may entail pre-submission of the required documents and delivering notice prior to having any sort of delays in work. Furthermore, the reasons for such delays were also clarified by the contractor, due to which the decisions and judgements taken by the CA were mistaken. Hence, the contractor possesses the right to fight against the decisions of the CA, as he had duly complied with all the required formalities and hence, charges of time and cost delays cannot be levied upon him. References Alnaas, K. A. A. & et. al., 2014. Guideline for Preparing Comprehensive Extension of Time (EoT) Claim. HBRC Journal, Vol. 10, pp. 308–316. Bailey, J., 2014. Construction Law. CRC Press. Crown, 2001. Housing Grants, Construction and Regeneration Act 1996. Chapter 53, pp. 1-103. Eggleston, B., 2015. The NEC 3 Engineering and Construction Contract: A Commentary. John Wiley & Sons. Gould, N., 2008. Understanding the Impact of Notice Provisions. Making Claims for Time and Money, pp. 1-17. Intuit, Inc., 2014. Professional Indemnity Claim Letter Template Document Sample. Docstoc. [Online]. Available at: http://www.docstoc.com/docs/84416911/Professional-Indemnity-Claim-Letter-Template#top [Accessed March 11, 2015]. Pinsent Masons LLP, 2011. Extensions of Time and Concurrent Delay: The City Inn Case. Topics. [Online]. Available at: http://www.out-law.com/en/topics/projects--construction/construction-contracts/extensions-of-time-and-concurrent-delay-the-city-inn-case/ [Accessed February 27, 2015]. Pinsent Masons LLP, 2011. Liquidated Damages. Topics. [Online]. Available at: http://www.out-law.com/en/topics/projects--construction/construction-contracts/liquidated-damages/ [Accessed February 27, 2015]. Read More