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Construction Contracts: Terms, Deadlines and Delays


The construction market in the United Arab Emirates (U.A.E.) is a key driver of the nation’s economy and is second only to Saudi Arabia within the GCC region. Today, the U.A.E. is home to some of the most ambitious mega projects underway in the world, with Abu Dhabi and Dubai propelling most of the sector’s growth. – PowerPoint PPT presentation

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Title: Construction Contracts: Terms, Deadlines and Delays

Construction Contracts Terms, Deadlines and
Deadlines and Delays Deadlines and delays are No.
3 on the list of top ten construction contract. 
A construction contract will often have many
deadlines, but one deadline looms largest
substantial completion.  Thats because
substantial completion is when the Work reaches
the point where an owner can rent it, sell it, or
work or live in it.  And theres usually a tight
schedule for reaching that point. 
Identifying the Deadline First and foremost, you
must identify the deadline.  You can either
identify a specific date and time March 1, 2013
at 500 PM local time at the project site.  Or
you can set a length of time that runs after a
specified date or event 360 days after the date
of the contract or 435 days after the city issues
the first building permit for the Work. If you
use the second type of deadline, be careful to
avoid controversy about when the time starts. 
And when youre setting your deadlines, check to
ensure they dont expire on weekends or holidays. 
  • Construction Delays
  • Nearly every project encounters delays.  The
    bigger and more complex the project, the better
    the odds for longer delays.  Delays pose three
    big issues
  • Who or what caused the delay and should those
    affected have expected that kind of delay?
  • Will the delay postpone deadlines?
  • Will the price be increased to compensate for
    additional costs imposed by delay?

Excused Delays When an "Excused Delay" occurs,
deadlines get postponed.  Contracting parties
often focus a lot of negotiation on what
qualifies as an Excused Delay.   Usually these
are events, things that could not be foreseen or
predicted before the parties entered into the
contract.  Theyre often called force majeure
Owner-Caused Delay Some delays come from one of
the parties.  A classic example is delay imposed
because the owner changes the project, a problem
with the design reveals itself after Work is
under way, or the owner defers making a critical
decision.  Building Construction Contractors can
find themselves in the same situation when a
prime contractor instead of the owner, makes an
error or doesnt make timely decisions.
Delay Notices Building Construction Contractors
often require a delayed contractor to give notice
to their counterparty that they are delayed. 
There is often a deadline for giving this notice
usually a select number of days after the delay
sets in.  Failing to properly and timely give a
delay notice will often waive the contractors
right to postpone deadlines and increase the
  • Delay Damages
  • Someone usually suffers damages if delays extend
    completion beyond its originally scheduled date.
  • Owner Delay Damages  Owners may lose rent,
    tenants, sales, public incentives, or financing
    opportunities, just to name the top five.  They
    may also have to pay additional interest on their
    construction loans 
  • Contractor Delay Damages  Building Construction
    Contractors will often incur additional overhead
    costs and may lose the opportunity to engage
    other work because their forces are still held up
    on the delayed project

  • Many of the damages that arise from delay are
    considered consequential damages.  Depending on
    what the parties pre-contracting communications
    and the language of the contract, it may be
    impossible to recover consequential damages.  And
    if the Building Construction Contractors includes
    an enforceable waiver of consequential damages,
    it will be. 

Building Construction Contractors In Dubai
UAE.P.O.Box 3815,Phone 971 4 2857324FAX
971 4 2851609Email
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