Legal disputes in the Construction industry are arguably one of the most expensive and technical disputes in the industry. As a result, it is imperative that you ensure that your construction contracts cover the full spectrum of the construction process. The construction industry has various standardised suits of contracts such as JBCC, FIDIC, NEC, GCC, PROCSA, etc that are preferable to your own makeshift contract. The standardised contracts are preferable as the interpretation of these contracts has been tested by our courts and accordingly, the risk of a dispute in relation to interpretation is a lot less. By conducting a simplistic search of reported cases in the South African courts the search result showed a staggering 136 cases reported in relation to the JBCC contract. This is despite the JBCC contract having an arbitration clause which has the effect that most probably only the construction disputes which required urgent or other intervention from our courts will be reported. The JBCC also makes provision for adjudication which will have the further effect that it is only in the rarest of circumstances that a dispute referred to adjudication will result in a reported case.
A further advantage of a standardised contract in construction is that all of the big players in the construction industry know and understand the contractual terms and as a result, also know and understand what is expected of them, which in turn reduces the possibility of a dispute which will result in the construction going the legal route.
It is like the saying goes, prevention is better than the cure, and the same principle applies to construction in so far as disputes. The best way to prevent a dispute is to have a proper contract in place. It is also imperative that if you decide to use the standardised contracts that you fully understand your rights and obligations as well as your legal remedies in the event of a dispute.
Hahn & Hahn’s Legal Construction department can assist you with understanding the various standardised suits of contracts such as JBCC, FIDIC, NEC, GCC, PROCSA, etc; and should your development be of such a nature that the standardised contracts do not suit your needs we also assist clients with bespoke suit of contracts.