• Many contracting questions amount to "Can they do that"?
The short answer is usually ‘Yes’ simply because a party can do anything it wants. However, it is the contract that defines whether or not an action is permissible. If the action is not permitted by the contract then it is a breach and the injured party is likely to have a course of action because of the breach of contract.
• I haven’t signed and returned the contract, do I have a contract?
The most likely answer is ‘yes’ just because a contract has not been signed and returned does not mean it has not been agreed as agreement can be by conduct when the works are commenced, however, contract formation is often a complicated matter and each situation is decided on the individual facts of the case.
• Is there a contract?
In circumstances where commercial organisations undertake work for payment or in the expectation of payment it is most unlikely that there will be not be a contract, the issue is more likely to be ‘what are the terms of the contract’?
• I haven’t been paid – what can I do?
Because of the Construction Act all defined construction contracts must have particular written payment terms. If the payment terms are not adhered to and payment is not made by the final date for payment then it is likely that a dispute has crystallised that can be adjudicated. Also, it is possible that there is entitlement to give notice of suspending some or all obligations under the contract, however, this should be considered carefully before being used as a method of resolving the matter.
• I forgot to issue a payment/pay less notice !
Since October 2011 if a paying party fails to issue the correct notices in response to an application then it is most likely that the application becomes the notified sum and the sum due for payment.
• Can I adjudicate?
Any party to a construction contract as defined by the Construction Act can adjudicate a dispute at any time, however, the dispute must have crystallised and the process defined by the contract should be followed. It is always important to have informed advice before commencing an adjudication.
• When can I get the final retention?
The contract will define when the final half of retention is payable however for contracts entered into after October 2011 release of retention cannot be reliant on certificates under another contract and it is likely that terms that fall foul of this provision would not be enforceable.
• Can I insist on/agree price before doing Variation?
The contract will define the processes for issuing variations and having them priced. For published forms of contract it is not usual for agreement to be needed before a variation can be insisted upon however it is always necessary to check the particular terms of the contract.
• Is that not an unfair contract term?
Unfair contract terms are normally applied to consumer contracts between individuals and businesses. In construction when the contract is between two commercial organisations that it is usually taken that the organisations have equal bargaining power therefore an argument that a term is unfair is not likely to succeed.
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