A construction contract forms, like any other type of contract, "a promise or set of promises which the law will enforce" (Pollock, Principles of Contract 13th edition). In effect, this means to that the main parties to the contract owe each other certain sets of obligations while also being entitled to certain rights. In practice, this acts as an agreement and sets the frame for the relationship between the client and the construction professional.
Elements of a good construction contract
Although the basis of a good contract is the document itself, it is also true to say that this should be underpinned by a good pre-contractual relationship between its parties.
Clients should seek to verify that construction professionals, whether they are builders, carpenters, plumbers or electricians etc, are suitably qualified while contractors should seek to ensure that clients fully understand the nature and requirements involved in the work being proposed.
Furthermore, all parties should be sure that they share a mutual understanding of all of the following elements and these are clearly laid out in the contract:
- The details, size, value and location of the property or land concerned
- Any environmental or planning concerns
- All relevant architectural and engineering specifications
- Details of the project's timetable and agreed deadlines
- Pricing and payment agreements. For example, when the construction professional is to be paid and how
- The names and responsibilities of specific parties
- Details of how and why the contract might be terminated
- Details of available remedies in the event of breach or non-performance of the contract
Breach of contract claims
If your construction professional has failed to uphold the obligations laid out in the contract, you may be able to make a breach of contract claim. Such claims give you the opportunity to secure damages for any losses caused by the contractual breach.
Generally speaking, there are two types of contractual breach in relation to construction contracts. These are as follows:
- Material breach - in the case of a material breach the grievance is considered to be so serious that the wronged party will not be obliged to fulfil any further terms of the contract.
- Non-material breach - in the case of a non-material breach the wronged party is able to claim damages but is nonetheless obliged to fulfil the remaining terms of the contract.
Unless the breach of contract is very serious it is usually in the interests of the client for the contractor concerned to perform the remainder of its obligations. This is because the cost and inconvenience of instructing a new professional to carry out the job can be considerable.
However, if the construction professional abandons its remaining responsibilities or behaves in a way that can be construed as disavowal, this is deemed to be a repudiatory breach. In this situation the client can terminate the relationship immediately and begin a claim for breach of contract. Examples of a repudiatory breach include the following:
- Refusal to perform work
- Abandoning the job/site
- Failure to rectify negligent work
- Removal of plant from the site
In the event of a possible repudiatory breach it is essential that the client takes action, as failure to do so may be viewed as an affirmation of the contract.
Specialist help with breach of contract claims
Oratto's member construction dispute lawyers are based in locations across the country and can help you make a breach of contract claim, for information, browse through the profiles of our member construction contract solicitors.