UNDERSTANDING THE MUTUAL INFLUENCE OF CONTRACT AND SUBCONTRACT TERMS ON CONSTRUCTION RELATIONSHIPS
The British University in Dubai (BUiD)
This dissertation was prepared in an attempt to highlight research points for consideration by contract drafters in the construction industry upon drafting main contract and subcontract documents. The research covered points to consider if a firm desires a subcontract to be treated as a general contract (back-to-back agreement). The aim of this study was to identify the relationship between main contracts and subcontracts in construction practice; a construction relationship involves employers and main contractors on one side, and main contractors and their subcontractors on another side. This study aimed to identify the practical influence of the terms of main contracts on subcontracts and vice versa. Such influences are examined in the particular areas of common construction terms that are most likely to be influenced as a result of the overall construction relationship. The particular areas discussed in this dissertation include some drafting examples and subjects for the understanding of the mutual influence of contract and subcontract terms on construction relationships. The main subjects are conditional payment clauses, liquidated damages, deadlines and dispute resolution. Numerous other sub-points derived from these main points are duly discussed in this dissertation. This topic was researched with concentration on UAE and UK laws and is supported with literature reviews of the civil and common law backgrounds. Particular consideration and references are given to the FIDIC’s Conditions of Subcontract for Construction 2011. The topic of this dissertation is seen as an important one because contract drafting is a sensitive practice that ought to be skilfully performed, and lots of circumstances should be considered for the purpose of achieving a project that is successful for the employer and for the other construction parties. Among these considerations are the balancing of risks between the construction parties and the particular circumstances to consider when drafting main contracts and subcontracts in general, as well as back-to-back subcontracts in particular.
mutual influence, subcontract terms, construction industry, dispute resolution, United Arab Emirates (UAE), law