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Contents
1Introduction Adjudication.
2Theinteractionbetweenclauses
Alternativedisputeresolution.
3Interactionwithcommonlaw
4Impliedterms Alternativedisputeresolutionlegislation.
4.1Impliedtermsbylaw Arbitration.
4.2Impliedtermsbyfact
4.3Termsimpliedbystatute Causesofconstructiondisputes.
4.3.1TheHousingGrants,ConstructionandRegenerationAct(HGCRA)1996. Constructioncontract.
4.3.2UnfairContractsTermsAct(UCTA)1997
5Disputes Contractclaims.
6Conclusion HousingGrantsConstructionand
7Findoutmore RegenerationAct.
7.1RelatedarticlesonDesigningBuildingsWiki
7.2Externalreferences

Introduction Featuredarticles

IdeascompetitionMakeBuildingsBetter
Englishlawdoesnotrequireaparticularformtocontracts,thereforethetermsandultimatelythe
riskallocationisthechoiceofthepartiesinvolved.StandardFormContracts(SFC)aimto
minimisethetimeandcostofnegotiatingcontracts.

SomeprofessionalsbelievethatpartiesshouldnotamendSFCsthroughchoice,asthereisa
complexinteractionbetweenmanyoftheterms(NdekurgiandRycroft,2009)andmodification
canchangethebalanceofriskandcreatelegaluncertainty.TheLathamReportrecommended
theuseofstandardcontractswithoutamendments(Latham,1994)andamendmentwasalso
criticisedbyLloydQCinRoyalBromptonHospitalNationalHealthTrustvHammondandOthers:

BSRIAandDesigningBuildingsWikiare
Astandardformissupposedtobejustthat.Itlosesitsvalueifthoseusingitor,attenderstage
askingwhatyourideasareforimprovingthe
thoseintendingtouseit,havetolookoutsideitfordeviationsfromthestandard.
performanceofbuildingsinuse.Win500of
BSRIAgoodies.
However,somearguethatnoSFCcouldallowforallthevaryingspecificsofeveryindividual
project(NdekurgiandRycroft,2009).Therearealsosituationswhereamendmentisnecessary
forexampleifcertainclausesbecomeobsoleteortheindustryshiftsandrequirestheinclusion
Tratoppen,Stockholm
ofnewterms.

AnyamendmentofSFCsshouldbeapproachedwithreluctanceandcaution.SFCsare
developedbyindustryrepresentativeswhohaveanunderstandingofcommonprojectproblems.
Amendmentscandisruptthebalanceofriskandimpactonthetruepurposewhichistoprovide
afaircontractframeworkthatresultsinasuccessfulproject(LocalGovernmentTaskForce,
n.d.).ThefullscopeofproblemsandimpactsofmodifyingSFCsisverybroadandsothisarticle
willjustconsiderthemainpoints.

Problemscanbeattributedtothreemainrisks:

1.Theinteractionbetweenclauses.

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2.Theinteractionwithcommonlaw.
3.Impliedterms.

Theinteractionbetweenclauses

Manyclausesarecrossreferencedwithothers.InthecaseofBramall&OgdenvSheffield
Council,thealterationofaliquidatedandascertaineddamagesterm(16eclauseofJCT63)
rendereditinconsistentwithotherrelatedterms.Thusthecourtinterpretedthisclauseas
unenforceable.AnotheralterationtoaclausewasrevealedinBalfourBeattyvDocklandsLight
RailwayLimited.Clause66ofanICE5theditionContract,dealingwiththeresolutionof
disputes,wasomittedcompletely.Additionally,clausesrelatingtothecertifierofpaymentsand
extensionsoftimewasalteredfromtheIndependentengineertotheemployer'srepresentative.
Disputesarose,butthedeletionofClause66meantanarbitratorhadnopowertoopenup,
reviewandrevisethedecisionsofthecertifier.Thecourtinterpretedthatitcouldonlyruleif
therehadbeenabreachofcontract,asitwasdeemedthatthepartiesintentionwastoomitthis
ConceptdesignsreleasedforStockholm's
clause.
tallestskyscraper.

Interactionwithcommonlaw
Sustainablewater

InteractionwithcommonlawwasshowninPeakConstructionvMcKinneFoundations.Inthis
case,theprintedtextofanextensionclausewasamendedwhichresultedinthecontractorbeing
entitledtopaymentofinflationuptopracticalcompletion,eventhoughhewasntentitledtoan
extensionoftime.Courtsinterpretedthatdeletionofthisclausemeans,ifthereisnoterminthe
contracttograntextensionoftimeandtheemployerobstructsbyactoromission,thecontractor
thenhasanobligationonlytocompleteinareasonabletime.Theemployerthereforelosestheir
righttorecoverliquidateddamages(Au&Chan,2010).

Impliedterms

Interactionwithcommonlawisalsoseenwithimpliedtermsbylaw,byfactandbystatute. Boldchangeeffortsarerequiredtomeet
Termsareonlyimpliedwherethereisnoconflictwithexpresstermsandwhereconsideredthe sustainablepracticeinthewatersector.

obviousnormcontractssilentonaparticularmattercanhavetermsimplied.

Impliedtermsbylaw Hyperion,Bordeaux

NaturallySFCscoveralargearrayofdetailedmattersandresultantly,impliedtermsareusually
irrelevant.However,themodificationofSFC'smayresultinparticulartermsbeingimplied.There
aretwomaintypes,commonlyreferredtoasobligationsofemployerandcontractor.For
exampleacontractorisexpectedtoprovideservicesatthelevelofcareexpectedofan
ordinarilycompetentmemberoftheirprofession.Manyinternationalinstrumentsfurtherthese
obligations.One,theInternationalInstitutefortheUnificationofPrivateLaw(UNIDROIT),implies
thedutytocooperate(5thChapter).Thisobligation(Article5.1.3)isplacedalongsideother
principlesobligationsofgoodfaithandfairdealing,reasonableness(Article5.1.2)and
performance(Article5.1.6).Henceonaninternationallevel,bothpartieshaveanobligationto Mixedusetimbercomplexproposedfor
cooperate.However,interpretingwhichpartyhasultimatelyfailedwiththisobligationis Bordeaux.
determinedoneachcasebythecorrespondingnationalcourt.Judicialdecisionsconsequently
varydependingonthejurisdictionalnationandhenceinterpretationofclausescanvary(Durand
Barthez,2012Klimas,2011).ThedutytocooperateisseeninEnglishcommonlawwiththe
Unusualbuildingdesignoftheweek
caseofLondonBoroughofMertonLBCvStanleyHughLeachLtd.Modificationofclausesmay
leavecontractsopentocommonlawinterpretationwhichmaynotreflecttheintendedtermsof
thedrafter.

Impliedtermsbyfact

Courtsaimnottoimprovecontractsastheybelievepartiesshould,onthewhole,bearthe
consequencesoftheiragreement(Furstetal,2008).Courtsregularlyreiteratethatimpliedterms
mustnotcontradicttheexpresstermsofacontract(Cooke,2007).Itmustbenotedhowever
thatcertaininstancesoccurwhereexpresstermsmaybedeterminedasunjustorunenforceable,

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thisiscoveredlater.Courtswillonlyimplytermsbyfactwhenitisobviousbothpartiesmeant
TheDaliTheatreandMuseum,oneofthe
foraclausetobeincludedbutunintentionallyfailedtoaccommodateit,orwhenatermis
'largestsurrealisticobjectsintheworld'.
requiredtogivebusinessefficiency,asshowninGulfImportandExportCovBungeSA.The
businessefficiencyprinciplestemsfromtheTheMoorcockcase(Woodetal,2011).

BIMisbigbusiness
Termsimpliedbystatute

ModifyingcertaintermswithinaSFCmaycontradictlegislationandtermsmaythenbeimplied.
WeshalllookattwomainpiecesoflegislationthatimpactonmodificationofSFCs.

TheHousingGrants,ConstructionandRegenerationAct(HGCRA)1996.

ThemainpurposetheHGRAistoensurecontractsincludesuitableprovisionsforpaymentsand
disputeresolution.IfamendmenttoanySFCcontravenestheactthenthestatutoryinstrument
knownastheSchemeforConstructionContractsdefaultsintoplace(HelpsandSheridan,2008).
TheamendmentofadisputeresolutionclauseinaJCT05tradecontract,totransferthecostof
adjudicationforbothpartiestothecontractor,wasdeemednoncompliantwiththeHGCRAand
TheglobalBIMmarketisexpectedtogrowby
theScheme.TheYulanda(UK)CoLtdvWWGearConstructionLtdcasesawtheamended
19%ayeartoreachUS$11.54bnby2022.
clausereplacedwiththeprovisionsmadebyPartOneoftheScheme.

UnfairContractsTermsAct(UCTA)1997
Invoicefraud

Generally,courtsarereluctanttomakeabadbargaingoodiftherewasconsensusadidem
(NdekurgiandRycroft,2009).UCTAcanbemisleadingasitdoesnotgovernallunfairnesswithin
acontractbutmainlyconcernsexemptionandlimitationclauses.Clausesthatlimitliabilityfor
deathorpersonalinjury,asaresultofnegligence,forexampleareunenforceableunderthe
UCTA.Section2(2)declaresanyclauseattemptingtolimitlossordamagecausedby
negligenceasunenforceable,exceptwhereaclausecanpassatestforreasonableness,as
showninRegusLtdvEpcotSolutionsLtd.(Chappell,2012NdekurgiandRycroft,2009).Courts
canthereforeinterpretambiguousclausesbyusingthereasonablenesstest,andsomeclauses
maynotevencomplywithstatutoryrequirements,andsomaybeinterpretedasunenforceable.

UKconstructionbusinesseslosemorethan
Disputes
1.8bnfrominvoicefraudeachyear.

Disputesnormallyarisewhenpartieshavedifferentinterpretationsofmodifiedclausesstemming
fromcontractnegotiation.Courtsseektodealwithinterpretationofambiguousmodifiedclauses SalernoMaritimeTerminal
withpreviouscaselaw,commonlawandstatutoryregulations,andatalastresort,mayrelyon
thecontraproferentemandreasonablenessprinciples(Furstetal.,2008).Thecontra
proferentemprinciplefollowsthat,whereapartymodifiesaclauseitistheirresponsibilityto
makethewordingclearandsotheyshouldloseoutifthereisambiguity.Thiswasshowninthe
caseofEnterpriseInnsPlcvPalmerstonAssociatesLtd(TaylorandTaylor,2009).

LordJusticeMooreBicksuggestedhowthecourtsattempttointerpretclausesinRavennavi
SpAvNewCenturyShipbuildingCo.Limited:

...readthewordsinquestionfairlyasawholeinthecontextofthedocumentasawholeandin
thelightofthecommercialandfactualbackgroundknowntobothpartiesinordertoascertain ZahaHadidArchitectscomplete'oysterlike'
whattheywereintendingtoachieve... terminalbuildingintheItalianportcityof
Salerno.
ThisfollowsfromthepointraisedinPaalWilson&CoA/SvPartenreedereiHannahBlumenthal
(TheHannahBluementhal),whereLordBrightmanstated:
Architectureandtheneedforinnovation
theBuyerstosoconductthemselvesastoentitlethesellerstoassume...

Fromthiswecandeducethatacourtwouldgenerallyadopttheinterpretationwhichareasonable
person,whoisconsideredtohaveallthebackgroundknowledgeavailabletobothpartiesatthe
timeofthecontract,wouldunderstandthepartiestomean(JaegarandHok,2010).Thisisthe
stancethattheSupremeCourttookinRainySkyvKookminBank.

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Conclusion

Therearealargearrayofdifferentstandardforms,draftedforamultitudeofdifferent
constructionandprocurementtypes,hencethereishighprobabilityofonebeingsuitable.SFCs
canbevaluableastheyreducethetimeandcostatthenegotiationstageandprovideasound
frameworkforprojectsuccess.Modificationsmayberequiredtorealignthemwiththeconstantly
changingindustrybutanychoiceamendmentsshouldbeconsideredthoroughly.Modifications
canmakeclausesambiguousormaybeunenforceable.Modificationcancreatelegaluncertainty
whichmayresultinthecourtsinterpretingtermsinaunintendedway.Itisthereforeimportantto
Architecturehasalwaysevolvedinlinewith
considertheramificationofalterations,questionwhetherchangesarenecessaryandensurethat
technology,butforhowlongwillthiscontinue?
termsdonothaveadetrimentaleffectonotherinterlinkedclausesoronthecontractasawhole.

Findoutmore NECZclauses

RelatedarticlesonDesigningBuildingsWiki TheNECcultureandthe'curseoftheZ
Adjudication. clause'.
Alternativedisputeresolution.
Alternativedisputeresolutionlegislation.
Arbitration.
Causesofconstructiondisputes. BuildingoftheweekCNTower
Constructioncontract.
Contractclaims.
HousingGrantsConstructionandRegenerationAct.
Mediation
Procurementroute.
RoyalBromptonHospitalNationalHealthTrustvHammondandOthers.
SchemeforConstructionContracts.
Standardformofcontract.
Zclauses.

Externalreferences

CaseLaw

BalfourBeattyvDocklandsLightRailwayLimited(1996)49CONLR1
BerkeleyCommunityVillagesLtdvPullen[2007]EWHC1330(Ch)
Bramall&OgdenvSheffieldCouncil(1985),1CONLR30
EnterpriseInnsPlcvPalmerstonAssociatesLtd[2011]EWHC3165
GulfImportandExportCovBungeSA[2008]2ALLER(Comm)
LondonBoroughofMertonLBCvStanleyHughLeachLtd(1985)32BLR51.TheMoorcock
(1889)14PD164
PaalWilson&CoA/SvPartenreedereiHannahBlumenthal(TheHannahBluementhal)
[1983]1AllER34 Thetallestfreestandingstructurefor34years
PeakConstructionvMcKinneyFoundations(1970)1BLR111
andtheiconicsymbolofCanada.
RainySkyvKookminBank[2010]EWCACiv582.
RavennaviSpAvNewCenturyShipbuildingCo.Limited(2007)EWCACiv58
Regus(UK)LtdvEpcotSolutionsLtd.[2008]EWCACiv38
Formorenews,gotothehomepage.
RoyalBromptonNHSTrustv.Hammond&Others(No.9)[2002]EWHC2037
TheYulanda(UK)CoLtdvWWGearConstructionLtd[2010]EWHC720

StatutoryLegislation

HousingGrants,ConstructionandRegenerationAct(HGCRA)1996UnfairContractsTerms
Act(UCTA)1997

OtherReferences

Au,Maria.C.Y.andChan,Edwin.H.W.ConstructionLawJournal.EnforceabilityConsideration
forDeletingtheExtensionofTimeProvisionsinBuildingContracts,[ejournal][Accessed
12thNovember2012]
Craik,M.andPatten,B.2007.SocietyofCosntructionLaw.ComplexConstruction
Contracts:WhoNeedsThem?WhoBenefits?
DurandBarthez,P.2012.InternationalBusinessLawJournal:Thegoverninglawclause:
LegalandEconomicConsequencesoftheChoiceofLawinInternationalContracts,[online]
[Accessed12thNovember2012]
Helps,D.andSheridan,P.2008.ConstructionLawJournal:ConstructionActReview
(October),[online].
InternationalInstitutefortheUnificationofPrivateLaw(UNIDROIT)UNIDROITPrinciplesof
InternationalCommercialContracts2004.
Klimas,E.2010.InternationalJournalofLawintheBuiltEnvironment.EmeraldArticle:A
GeneralDutytoCooperateinConstructionContracts?AnInternationalReview.Vol.3Iss:1
pp.8396.

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