Design development post contract signing in New Zealand:Client's or contractor's cost?

By offering fixed-price contracts for designs supplied by clients, contractors legally warrant that they can build what has been designed and do so within their fixed price. Yet detailed drawings are often issued during construction in response to contractors' requests for information on the basis that they cannot otherwise build what has been designed. Claim-entitlement decisions are often made by construction professionals (architects, engineers and quantity surveyors) without legal training in contractual interpretation, potentially varying who pays for design development after contract signing, contractors or clients. Prior studies have addressed buildability obligations relating to ground conditions and foundations. This study applies key principles of contract law to consider who should pay for instructed drawing details post contract signing under the New Zealand standard NZS 3910:2013, 'Conditions of contract for building and civil engineering construction', in terms of (a) when a variation claim may be accepted; (b) the effect of contractor involvement on design development; and (c) the effect if claimed from a building subcontractor to a consultant manager (no head contractor). A claim-entitlement flow chart and a table comparing the head contractor's and consultant construction manager's obligations provide practical guides for contract administrators. Identifying terms prone to interpretation informs contract drafters towards reducing ambiguity for contract users and therefore the potential for dispute

Late disputes and the NEC3 Engineering and Construction Contract

One of the reasons for project owners’ choice of the NEC3 Engineering and Construction Contract (ECC) is the avoidance of the risk of claims and disputes long after project completion. In a number of cases the court has been presented with difficult questions concerning adjudication after project completion and delayed reference of adjudicated disputes to the applicable final tribunal. The cases have not been from projects procured with NEC contracts. This paper critically examines these questions, the court’s answers to them and their implications for the NEC3 ECC family of contracts. It concludes that, in the drafting of future editions of the contract, the promoters of the contract should consider provisions targeted at: ensuring that the test of awareness for the purposes of the Clause 61.3 time-bar is on an objective basis; conclusive evidence clauses that impose a disincentive against seriously delayed challenges to assessment of compensation events and payment; and providing that the decision of an adjudicator becomes finally binding if the dispute decided is not referred to the tribunal within a stated period