A recent judgment of the High Court of Fiji has discussed and clarified the operation and legal effect of defect liability clauses in construction contracts.
This Judgment adds to Fiji's jurisprudence for construction law and emphasizes the importance of construction law contracts particularly when things don't go to plan.
We provide a short update in relation to important legal points that have arisen from the High Court's Judgment. The Judgement was also reported in Fiji's national press here
There have been concerns raised recently within the Fiji construction industry regarding the importation of substandard structural steel for use in construction projects in Fiji.
What happens if substandard quality materials are used in construction projects in Fiji and who is legally responsible?
In this commercial law update, we look at the legal position in relation to substandard materials and warranties implied by law in contracts for works and materials.
Each construction contract has its own different areas of risk.
In this commercial law update, we consider only the general areas in which risks can arise and need to be managed in a construction contract.
The best way of ensuring the efficient management of your risk in a construction contract is to negotiate the management and allocation of those risks during the negotiations stage.
The more effort the parties put into ensuring a properly managed and allocated risk profile during the process of negotiation, the more chance there is of the parties avoiding otherwise preventable situations during the implementation of a contract.
In this commercial law update we set out how to negotiate a construction law contract and provide some basic points to note.
Construction projects take time to deliver and typically involve multiple parties, including a contractor and professional advisors.
Construction contracts have evolved to large documents that balance risk and reward and set out the processes that must be followed as the construction develops. Despite their apparent complexity the legal principles that underpin a construction contract are the same contract law principles that underpin any other legal contract.
In this update we briefly consider the legal principles and law that common law jurisdictions apply to construction projects.
Risk Allocation
This commercial law update looks at the principles behind efficient risk allocation in a contract and how, a lack of understanding of these principles, might lead to unintended consequences.
Every contract is essentially a sharing or allocation of risk, responsibility, and reward between the parties. It is not sufficient for commercial lawyers to rely on template contracts or checklists because to understand and assist with a commercial transaction requires an understanding of the risks involved. A thorough understanding of risk will assist with the provision of informed legal advice and a contract that may avoid, reduce or fairly allocate risk.
This legal update considers the key questions that arise in terms of the allocation of risk: how should the risks be shared? Is there an efficient way of sharing risk? What considerations should be taken into account when deciding which party should take on which risk in a contract?