Construction Contract Law - Defects, Liability, and Retention Money

Running Head: CONSTRUCTION CONTRACT LAW
CONSTRUCTION CONTRACT LAW
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CONSTRUCTION CONTRACT LAW
1
ANSWER 5:
A construction defect is meant when finished or partially finished constructed building
fails to perform as it was required or expected to perform in accordance with the applied contract
details or the accepted standards of such buildings. Such defects includes situations like flexing
and snapping of the bridge cables, the understrength or structure deficiency of the concrete, the
leakage of the roof, the non-bonding of the adhesives and the peeling of the paint and so on.
Section 2.1 of the Standard Form of Building Contract 1998 defines the duty the contractor.
There is a slight difference between the obvious and the latent defects. While the former
deals with the defects which are clear at the time of the construction and the liability arising from
such defects are clear and the correction cost is minimal as compared to the latent defects. On the
contrary, the latent defects are those which also exists at the time of construction but is
undetected until the time after the completion of the construction while the structure and systems
of the buildings are in usage. Latent defects are also progressive in nature determining the wear
and tear of the building with time along with the defect worsening with time, and the application
of natural forces. Thus, the basic difference between both the defects are where the obvious
defects are detected at the time of construction, the latent defect, even it is present at the time of
the construction, but its detection only happens after the completion of the construction of the
building while its structure and systems are in use. Thus, in the broad sense, the defects of the
building constructed can be classified as the manufacturing defects, design defects, and the
failure to warn defects. These defects form the grounds for negligence or strict liability and other
actions involving civil consequences.

CONSTRUCTION CONTRACT LAW
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The liability for the defects in construction can be discussed under two heads. The first is
the Contractor Liability. It is the responsibility of the constructor to ensure that the construction
work is performed in accordance with the requirement of the project. The contractor sublets the
work to the subcontractors like ironworkers, plumbers, electricians, carpenters and so on. The
primary duty of the contractor is to purchase the raw materials required for the construction. The
obligations of the contractor is defined in the construction contract and the breach of any
provision would amount to the breach of contract and hence the liabilities in accordance to the
suit initiated. The contractor is supposed to work fully in accordance with the plans and the
specifications as per the construction contract (Schenck and Goss 2015). Most contracts state
these duties and obligations explicitly to avoid any discrepancies with respect to the duties of the
contractor and if, a specific contract provisions are absent at any stage, the law generally implies
the general and specific duties as per the common law principles into every construction
contract. However, a contractor is exempted from his or her liability on the ground that if the
owner’s attention was brought into notice if any defect or deficiency or failure was noticed by
the contractor at the time of the construction, before the performance of such task.
The second liability that can be discussed is the Designer Liability. Architects and
engineers are the project designers who may be engaged for some or most or all of the services
ranging from total control over the responsibility of the project to the limited role to prepare the
design scheme along with the quotation and leave the decision at the will of the owner (Santrolla
2017). The designers may get involved with the project along with the control of the construction
or the designer may only be limited to the preparation of the design schemes and prepare plans
for others to implement and execute. The basic duty of the designer to exercise duty of
reasonable while performing his or her duties as any reasonable professional would have done in