Utility and residential construction

Renovation and new builds

In addition to disputes about civil works construction, an important part of our advisory practice involves resolving disputes about non-residential construction and (high volume) residential construction. We regularly support contractors who do the work: building contractors, installation engineers, architects, consulting engineers and project management firms. We represent these parties in disputes with commissioning bodies as well as subcontractors and suppliers.

They work on renovation and new builds for a variety of structures including schools, hotels, hospitals, museums, car parks, shopping centres, low-rise and high-rise buildings, such as offices and apartments. In some cases, this work is based on integrated contracts including the engineering and design.

Often such works are carried out with a traditional division of responsibility, where the commissioning authority is responsible for the design and the contractor is then responsible for the proper construction based on that design. We therefore regularly advise and litigate on issues regarding traditional contracts based on STABU specifications, the purchase/contracting agreement (with warranty and guarantee scheme), contracts for services which are governed by the AVA (1992 or 2013), the UAV (1989 or 2012) or – for technical installation work – the ALIB (1992 or 2007), contracts governed by the DNR (2005 or 2011) and regarding contracts based on the FIDIC model contracts (FIDIC Red Book).

Due to increasing use of integrated contracts, we also regularly advise and litigate on contracts which are governed by the UAV-GC 2005, as well as other Design & Build, Design & Construct, EPC (Engineering, Procurement and Construction) and Turnkey contracts, and on contracts based on the FIDIC contract models (FIDIC Silver Book and FIDIC Gold Book). For residential construction, disputes often involve the SWK terms and conditions.

Common disputes

Disputes often concern responsibility for the information provided by the commissioning authority (UAV 2012 par. 5 and UAV-GC 2002 par. 3.2 and 3.3), the interpretation of the specifications, settlement of contract variations, the contractor’s obligation to give financial warning, additional payments, losses due to delays and inefficiencies, or the commissioning authority’s refusal to pay. Other areas of dispute include any rights of retention exercised, penalties and discount schemes, bank guarantees, design or execution errors, CAR or AVB insurance policies, contractor’s liability for latent defects and guarantees.

Sometimes the commissioning body and the contractor fail to complete a project together because the commissioning authority dissolves the contractual agreement due to an attributable breach, or because one of the parties terminates its work in an unfinished state, or cancels (UAV 2012 par. 14 or UAV-GC 2005 par. 16.8) or dissolves the agreement (in accordance with UAV-GC 2005 par. 16.5 or 16.7). In such cases, there are often discussions about the basis for termination and then the final settlement. We also have extensive experience with these types of dispute.

Proceedings are usually settled by the Arbitration Board for the Building Industry, the NAI or an ordinary court. We are also regularly involved in disputes which are resolved through mediation or binding opinion.