Construction Contract Assignment

Running head: CONSTRUCTION CONTRACT
CONSTRUCTION CONTRACT
Name of the student
Name of the university
Author note

CONSTRUCTION CONTRACT1
The effect and interpretation of contractual conditions can differ significantly rest on the
legislation that regulates them. The holistic method to deal with the disputes that evolving from
the construction contract in Australia is an attempt to examine and identify their life cycle and
genesis. It assesses the determinants that are accountable for the high occurrence of disagreement
on the significant construction undertakings. The factors involve the adversarial practice of the
construction industry, the high grade of severity that surrounds the project, the inevitably of the
dispute between the role of construction agreement and the contracting parties in facilitating such
disputes. Therefore Dispute avoidance procedures are contemporary innovations that are
enhancing applied on the significant construction undertakings to assist the contractual parties to
interact, collaborate and coordinate as well as evading the escalation of fight into disputes.
According to the English court of law the construction contract does not identify any distinct
obligation of good faith. Vinelott J. said that, though the court of law will imply an obligation
upon contractual parties to conduct whatever was necessary for the purpose of the agreement
being carried out, the necessitates of acting in good faith have not be inserted in English law. the
formulation of Alternative Dispute Resolution, the innovation of rules of civil procedure, the
formulation of Technology and Construction Court and particularly the initiation of the
adjudication method as well as the hybrid multistage procedure of dispute resolution has
transformed the view of construction dispute settlement1. Therefore to pact with guaranteeing
1 Thompson, Clare. "Avoiding claims of breach of good faith." (2015) Brief 42.4 28.

CONSTRUCTION CONTRACT2
that dispute avoidance and resolution provisions are efficient, it is required to regard the series of
the techniques of dispute resolution that are obtainable in the construction industry involving the
following. The several techniques of dispute resolution are negotiation, mediation, and
conciliation, adjudication, arbitration, litigation.
The term "negotiate" implies to deliver with orders for the purpose of attaining agreement
or compromise. Negotiation is regarded as an interaction to influence the preeminent method of
dispute resolution in the construction industry. Nevertheless negotiation should not be regarded
as merely the process of dispute resolution. It is the expansive form that may be regarded as the
procedure by which peoples interact to arrange their trade affairs and also private lives by
creating arrangements and reconciling the zones of disagreement2. It is the fundamental method
which facilitates simple party grounded problem resolution techniques. Nevertheless the crucial
characteristic of the procedure is that dominion of the impact remains with the contractual
parties. Thus arbitration and litigation need the parties to submit their disagreement to the third
party who will execute a legally binding decision. Thus negotiation is the procedure of working
out the arrangement by the way of direct interaction. There are two common threads. Firstly the
manner of intervention of a third party3. The fundamental character of the third party is to
provide the decision making of other individuals. The procedure establishes on negotiation and
the mediators primarily review and sustain the situation with the contractual parties. Secondly,
third parties must be autonomous of parties involved in the dispute. The essence of the method of
2 Dixon, William M. "Termination for convenience or not?." (2017) Australian Business Law
Review 45.3 (45 ABLR 229) 229-242.
3 Barreto, Paula Mena, et al. "Good faith in franchising." (2015) Int'l J. Franchising L. 13 17.

CONSTRUCTION CONTRACT3
mediation is to be neutral. The trust and confidence which develops during the procedure permit
the mediator to conduct "a bridging role" between the contractual parties4.
Mediation is essentially an informal procedure by which the parties are aided by one or
more impartial third parties in their attempt towards resolution. Therefore mediator does not
arbitrate or judge the dispute. They consult and advise neutrally with the parties to support them
in bringing mutually agree settlement to the issue. It is the procedure by which the settlement is
carried out with the support of a third party. The process of adjudication as the method of
alternative dispute resolution indicates the process by which the adjudicating authority decides
the case or how the referee must decide the problem that is placed before him. Thus more
particularly the adjudication may be designated as the procedure where the impartial third party
gives a decision that is binding on the contractual parties in disagreement until or unless revised
in litigation or arbitration.
The constricted interpretation may indicate the commercial application of adjudicators to
decide the issues arising between the parties in the construction contract. The application of
adjudicator is observed in several standard forms of agreement that are used in the construction
business5. The adjudication in the construction industry shows several features. Firstly the
adjudicator is an impartial individual who is not engaged in day to day administration of the
contract. Secondly the adjudicator enjoys his authority by the arrangement between the
contractual parties. Therefore in another manner the contractual parties have accepted by
4 Abdullah, Nik Abdul Hafiz Nik. Application of Good Faith as Necessary Limits in Exercising the
Termination for Convenience Clause. Diss. (Universiti Teknologi Malaysia, 2015).
5 Lees, Amanda. "The enforceability of negotiation and mediation clauses in Hong Kong and
Singapore." (2015) Asian Disp. Rev. 17 16.