Construction Contracts: Omission, Suspension Termination

structure cut backs Omission, fault depotAn compend of Omission, Suspension Termination of Construction centres at a lower place polite jurisprudence of Qatar UAE1. IntroductionQatar has a good-developed and structured intelligent system. The origin of the Qatar healthy system is found in both ancient and traditional sources. It is establish on Islamic virtue of nature and jurisprudence but has adopted m whatsoever of the principles of the Napoleonic Civil enroll (French Civil Code). In addition, Egyptian philosophy of law and procedure (Egyptian Civil Code) had a great influence on the legal and juridic system of Qatar.The State of Qatar is a traditional country conventionalismd by Al-Thani family and the state leadership cosmos inherited by Al-Thani family since mid-19th century Qatars judicial history was influenced by a series of gists set-back with the Ottoman occupation of the region in the 19th century. As stated in Background to legal system in Qatar by Qatar legality website The Ottoman rulers established a system of justice based on teachings of the Hanafi school of Islamic Law. As the Ottoman Empire started to lose its grip on its rule in Qatar and elsewhere in the Arabian Gulf, Qatar on a lower floorwent a gradual shift towarf ards the Hanbali school of Islamic Law to a lower place the influence of the then emerging regional power, Saudi Arabia (Partners, 2014).Qatar became a protectorate of Britain after the 1916 pact and British legal system was established formally after the treaty. The civil appeals established by British enforced English laws albeit local courts continued to administer a legal system based on shariah law law (Islamic law) which was the legal system in pre British era. This practice created a dual court system that existed until recent time in Qatar.Modern Qatar legislative process began in 1961, when Law none 1 for the year 1961 was issued. Subsequently, several modern legislations covering the adm inistrative, economic and social activities were enacted. Qatar passed the new Judicial Law nary(prenominal) 10 for the year 2003 in October 2003 which revolutionized and unified the judicial system in Qatar. This law became effectual in October 2004.Qatar enacted a new Civil Law in 2004, providing applicability in respect of boundary of time and territorial jurisdiction. Other important comments such as of natural and juridical persons principles and legal susceptibility to sue and be sued were incorporated in to the new Civil Law. Contractual relationships in construction sector were codified as Law No. (22) of 2004 with the passing of Qatar Civil Law.Law No. (22) of 2004 Promulgating the Civil Code was issued by H/H Hamad Bin Khalifa Al Thani, Emir of Qatar exercising the executive authority vested low the Constitution. As stated in Qatar Law website Qatar Civil Code provides guidelines for the establishment of bosomual relations and obligations arising therefrom. It sp ecifies elementary elements of a curve such as consent, subject matter, and purpose of spotting. It also deals with annulment, construction and medical dressing nature, effect, and cancellation of experiences (Partners, 2014).The UAE union comprising s horizontal Emirates namely Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah, Umm Al Quwain, Ajman and Fujairah was established on 02nd of December 1971. The Constitution declargons the shariah is the principal source for law in the UAE and a civil law jurisdiction heavily influenced by the Egyptian law system which was heavily influenced by French and Roman law.Commercial transactions are governed by UAE national Commercial Transactions Law Commercial Code (No. 18 of 1993). Civil transactions are governed by UAE Law of Civil Transactions Civil Code (No. 5 of 1985 No. 1 of 1987) (Whelan, 2011). In the absence of any specific provide in Civil Code , the Islamic Sharia law impart be applied. In matters of procedure, the UAE courts f ollow the Federal Civil Procedure Law Civil Procedure Code (No. 11 of 1992 as amended). Articles 872 to 896 of the UAE Civil Law 1987 (the Civil Law) relating to construction diddles, as well as general maxims and principles set out in the same law, form the basis of the legal model relating to construction. Also, UAE Commercial Transactions Law provisions would apply to the degree that the parties to a construction claim could be defined as traders conducting commercial business as per Articles 6 and 11.The general principle of freedom and sanctity of contract is recognized under the Qatar Civil Code and a contract is treated as the law of the contracting parties. Natural and legal persons are free to agree on whatever they desire, provided that their agreement does not conflict with law, public order and morality. Verbal contracts and contracts as a result of conduct of the parties are for the most part recognized and are enforceable in court subjected to establishing / proving the contractual-relationship.The Civil Law also deals with interpretation of contracts, contractual responsibilities, liability for personal acts, and responsibility for acts of third parties, ownership responsibilities, surety, unjust enrichment, types of sale, lease, insurance, and rights attached to property, land law, mortgage, go aways, legacy, privileges, and gains. It also stipulates performance, payment and compulsory execution, assignment of rights, innovation and impossibility of performance and statutes of limitation. asseverators are often faced with employer- driven Omission, Suspension Termination of the Construction Contracts due to financial constraints and other difficulties encountered by Clients and asseverators in Qatar Middle East in general.Medium to large scale public works projects procured by Public whole kit and caboodle Authority of Qatar (Ashghal) office General Conditions of Qatar (its own spoke form) published by Contracts Engineering Business Affairs (CEBA) which were updated and reissued on July 2007 lively by either in-ho drill lawyers or external law firms. The Qatar General Conditions of Qatar is a close resemblance of planetary Federation of Consulting Engineers (FIDIC) Yellow, Silver or Red Book contracts. The other major projects procured by state machine-accessible organizations such as Qatar Foundation, Qatar Gas, RasGas, Qatar Water Electricity board (Kharamaa), New Doha Aiprt Steering Committee use their own bespoke and project specific forms.Where a project is awarded on a lump check basis, the 2007 General Conditions of Contract favoured by employers in Qatar places very much of the risk for losses on the avower, except where losses are adequately covered under the amended provisions to the Contract. A reasonably fair assessment of the General Conditions of Contract by many contractors in Qatar is that it heavily favours the employer. While this may be the case, a contractor may also be entitled to claim equitable relief in unison with the Qatar Civil Law No. 22 of 2004.In the above scenario, it is imperative to analyze the rights and entitlements of Clients Contractors in pile arising from Omission, Suspension Termination of the Construction Contracts under FIDIC 1987 revision 4 FIDIC 1999 which are base documents for most of the custom-built Conditions of Contracts in Qatar and its enforcement under the Civil Law of Qatar U.A.E.2. Aim learn the legal aspects of Omission, Suspension Termination of the Construction Contracts under the Qatar U.A.E Civil Law.3. ObjectivesThere are four objectives of this studyTo identify the limit of a Contractors picture show to the Employer in respect of Omission, Suspension Termination of the Construction Contracts.To identify the limit of Employers exposure to the Contractor.Analyze the entitlements between FIDIC suit of Contracts and Qatar U.A.E. Civil CodeTo doctor reasonable solutions and precautions.4. Research methodologyTh e following literary works was reviewed during the initially to ascertain the feasibility of conducting a comprehensive search on the subject dissertation.Binding rend of a Contract Article 171of Law No. 22 of 2004 Qatar Civil CodeA contract is the law of the contracting parties, and it may not be revoked or amended, except by agreement of both parties or for prescribed by the law (Portal, 2014).Dissolution of a Contract Article 183of Law No. 22 of 2004 Qatar Civil CodeArticle 183 states that In contracts binding on both parties and imposing bilateral obligations (synallagmatic contracts), where one of the parties fails to perform his obligation, the other society may, upon formal notice to the former, demand performance of the contract or its rescission, and may claim any damages caused by such failure to perform (Portal, 2014).The judge may,mutatis mutandis, determine a period of grace within which the obligor shall perform his obligation. The judge may also reject the e xercise for rescission if the obligation not performed is insignificant compared with the obligations considered in their entirety (Portal, 2014).Termination of a Contract of Works under Articles 703, 704 707 of Law No. 22 of 2004 Qatar Civil CodeTermination of a Contract under Articles 892 893 of UAE Federal Law No. 2/87 The Civil CodeDissolution of a Contract under Articles 185 188 of Law No. 22 of 2004 Qatar Civil CodeArticle 185 states that When a contract is rescinded, the contracting parties shall be reinstated to the position they were in prior to the date of the conclusion of the contract. If reinstatement is impossible, the court may grant grant (Portal, 2014).Article 188 states thatThe contracting parties may mutually agree to terminate the contract upon its conclusion, provided that the subject matter of the contract remains in the possession of either party.Where the subject matter of the contract is lost, damaged or abandoned of in part in favour of a third party , the contract may be rescinded to the cessation of the remaining part and the share of the party (Portal, 2014)Dissolution of a Contract under Article 273 of UAE Federal Law No. 2/87 The Civil CodeDissolution of a Contract under Articles 267 268 of UAE Federal Law No. 2/87 The Civil CodeThe binding force of a Contract under Article 172 of Law No. 22 of 2004 Qatar Civil CodeThe effect of the Contract under Article 246 of UAE Federal Law No. 2/87 The Civil Code belief issued for the year 2006 by Court of Cassation, DubaiLiterature study and analytical research are my major reading methods which play an important role in this report. Analytical research involves analyzing existing case law, facts and information. The data pull up stakes be collected from primary/secondary sources, interviews with industry experts and case studies/laws.Literature study and analytical research go through been chosen due to complex laws of the country and its interpretation by the Law experts. H owever, any analysis contained in this dissertation is the authors own opinion and shall not be construed as secern in a court of law. This paper does not score any legal or contractual standing in interpreting a binding Contract Document.5. Scope and LimitationThe building construction contracts stipulate express provisions governing the rights of one or both parties to terminate the contract under certain batch. These express provisions are categorized as non-contractual rights and contractual rights to terminate a binding contract. The Non-contractual rights to terminate are defined asFrustration and this occurs when circumstances rather than the default of contracting parties have intervened to prevent the contract being performed as intended originally. When frustration occurs, further performance of the contract is impossible, culpable or radically changed from what the parties contemplated at the time of signing the contract. The contract is automatically terminated once a frustration event occurs and the parties are absolved from further obligations but accrued liabilities remain with them. The party who is relying on frustration provisions in the contract must be sure of that a frustration event actually occurred when justifying the ceasing of operations under the contract to avoid being in break down (the contract is more expensive to perform is not a forbid event). It is prudent that the events stipulated under force majeure clauses should not point of intersection with the frustration events and the events which are provided their consequences are stated in the contracts shall also not be considered as frustrating events.It is imperative to define metier Majeure events in the contract and clause 19.1 of FIDIC 1999 First Edition state that the definition of Force Majeure asMeans an exceptional event or circumstance(a) which is beyond a companionships control,(b) which such ships company could not reasonably have provided against before e ntering into the Contract,(c) which, having arisen, such Party could not reasonably have avoided or overcome, and(d) which is not substantially attributable to the other Party (FIDIC, 1999).Force Majeure events are exceptional events or circumstances as listed FIDIC 1999 below and those satisfy the clause 19.1 of FIDIC 1999 sub-clause (a) to (d) above(i) war, hostilities (whether war be declared or not), invasion, act of foreign enemies,(ii) rebellion, terrorism, revolution, insurrection, military or usurped power, or civil war,(iii) riot, commotion, disorder, striking or lockout by persons other than the Contractors Personnel and other employees of the Contractor and Subcontractors,(iv) munitions of war, explosive materials, ionising radiation syndrome or contamination by radio- act, except as may be attributable to the Contractors use of such munitions, explosives, radiation or radio-activity, and(v) natural catastrophes such as earthquake, hurricane, typhoon or volcanic activit y (FIDIC, 1999).Repudiation and this occurs when a party to the contract commits a serious breach of contract that entitles the innocent party to consider the contract as terminated with immediate effect and sue for damages due to breach of the contract. The following will be considered as clear repudiation of a construction contractContractors refusal to carry out contract scopeVacant the site or un-authorized removal of limit by the contractorProcuring other contractors to carry out the whole or part of the scope of work originally contractedEmployers failure to give access to the site (possession of the site).The Contractual rights to terminate are classified asTermination for Cause and the clauses stipulated in the contract vesting powers/rights to terminate the contract for breaches of specified contractual obligations such as unjustified/ unrecoverable delays attributed non-performance of the works. The parties may exercise their rights to terminate in other circumstances too , such as occurrence of a force majeure event.Termination for Convenience or at will clauses may be incorporated in to construction contract vesting powers to one party to terminate the contract without having to establish any cause or breach for consequence for the other party. This clause is very serviceable in the event that thethe employer changes the use of the land (eg. Condominium development to a hotel development)the employers inability to unafraid(p) financing for the whole project or secure anchor tenantsthe contractor finds the project will be unprofitable or too riskythe project has been suspended for a prolong period with no prospect of it being recommenced.There is a very close relationship between suspension and termination and, depending on how the clause is drafted. The end result of a suspension clause may be much the same as a termination clause in that either party will have the right to terminate the contract at the end of the agreed suspension period. The ju stification for suspension clauses will be broadly similar to termination such as a change of circumstances on the ground that makes continuing with the works impossible in the short term. Notwithstanding the above, suspension may be used by one party to allow it space to consider how to proceed with a project, which should be acceptable to the other party if kept within bounds.The scope of this research is to identify the legal provisions to secure the rights and entitlements provided under Qatar Civil Code and UAE Federal Law in Omissions, Suspensions and Terminations and limited to the construction contracts under the jurisdiction of the subject countries.The main limitation is the Language. The Qatar and UAE Laws are written in Arabic and official transformation in English language is not available. The author relies on many unofficial translations of Qatar and UAE Laws for the purpose of this research. Arabic language prevails over the any launage in a Court of Law in Qatar an d UAE.6. ConclusionThe Contractor shall be compensated forRe-measured work donePreliminariesMaterial delivered / orderedUnder- recoveriesCosts/increasesRemoval of Contractors equipmentRepatriation of staff/labourLoss of damage (loss of profit)Costs resulting from suspensionafter recovering the following from the contractorAdvance PaymentPrevious paymentsEmployers recoveriesAll these compensation and recoveries are stipulated in FIDIC Conditions of Contracts (or amended bespoke versions) and enforceable under Law No. 22 of 2004 Qatar Civil Code and UAE Federal Law No. 2/87 The Civil Code. The Contractors (and the Employers) as the case shall be able to seek the solace of Law even if the Contract Agreement they entered in to is heavily bias towards the Employer as the Law of land prevails over any contractual relationship between parties.7. ReferencesFIDIC. (1999). Conditions of Contract for Construction. In I. F. Engineers, General Conditions (pp. 56-58). ISBN 2 88432 022 9.Part ners, S. A.-A. (2014). Background Legal dust in Qatar. Retrieved 08 25, 2014, from www.qatarlaw.com http//www.qatarlaw.com/background-legal-system-in-qatarPortal, Q. L. (2014, 08 25). Law No. 22 of 2004. Doha, Qatar.Whelan, J. (2011, 07). The Civil Code. Retrieved 08 27, 2014, from http//lexemiratidotnet.files.wordpress.com http//lexemiratidotnet.files.wordpress.com/2011/07/uae-civil-code-_english-translation_.pdf