logo

Legal risk management Assignment Sample

   

Added on  2021-06-17

12 Pages2849 Words26 Views
LEGAL RISK MANAGEMENT

Table of ContentsInherent risks & possible consequences for contracting party and contractor................................3Dispute Resolution Approaches......................................................................................................8Management of contract................................................................................................................11References......................................................................................................................................11

Inherent risks & possible consequences for contracting party and contractorThe Victorian Desalination Plant (VDP) project is a government funded project, the contract forwhich has been offered to Aqua Sure Company in the year 2009 under Public Private Partnership(PPP). The inherent legal risks associated with the pre-construction, construction and operationalphase of the project as well as the possible consequences for the contracting party i.e.government and the contractori.e. Aqua Sure Company, will be discussed. The six risks associated with the project are as follows;Risks in pre-construction phaseI.Risks related to non-compliance of EPBC ActThe VDP project is being handled by Aqua Sure Company and the risk of existing underlyingenvironmental conditions might affect the project and create subsequent risk of damage to theenvironment in terms of flora fauna associated with the region. The Environment Protection andBiodiversity Conservation Act 1999 (EPBC) and Flora and Fauna Guarantee Act 1988 (FFG)protects threatened plants and animal species, ecological of Victoria region from potentiallythreatening processes [ CITATION Vic17 \l 1033 ]. During the construction phase in plant site, itwas found that there was existence of certain EPBC-listed flora and fauna species as well as theirhabitat. According to the EPBC Act provide for the issuing of approvals and permits for varietyof activities on Commonwealth land as well as land affecting the Commonwealth. The failure tocomply with the Act could lead to the penalties which include remediation of the damage, courtinjunctions, and civil as well as criminal penalties.II. Risks related to designing ErrorsThe types of risks that might arise with the design are the inadequate designing for the purposerequired. It is required to be in compliance with the functional as well as performance

specification as provided by the government. In addition, it should follow the constructionstandards of Australia. After the finalization of the design, it is verified and approved by thecontracting authority. In case of errors during the construction phase, the risk of liability ariseson both the parties to the contract, equally as both have approved the designed with their mutualconsent. Risks in construction phaseIII. Risks related to delay & cost-overrunDuring the construction phase, the completion of project related risks such as delay incompletion of construction of plant or cost overrun, which becomes time consuming as well asfinancial loss due to extra costs incurred in the completion as planned in the budget. Under thecontract, the provision of liquidated damages accounts for the damages caused due toinexcusable delays in the project beyond the date of completion of construction process. In thiscontext, inexcusable delays are considered as contractor caused delays or the delays caused dueto the risks as accepted by the contractor under the contract[ CITATION Ale18 \l 1033 ]. Theprovision of liquidated damages is standard and enforceable by calculating the actual pre-estimate of the related loss. The contractor will be held responsible for delay and cost overrunand they will have to suffer loss of expected revenue, ongoing costs of financing the constructionof plant as well as extended costs of site. IV. Risks related to labor disputesDuring construction phase, the issues of labor disputes usually arise and the conflicts might begeneral or political in nature. The responsible authority for this risk would be the contractor asthe management of labor is considered as the responsibility of the contractor. The allocation of

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Victorian Desalination Project - Doc
|11
|2314
|121

Legal risk management - Assignment Sample
|10
|2947
|51

Legal Risk Management : PDF
|12
|2584
|136