Engineering and Construction Contracts in Terms of the Common Law

Engineering and Construction Contracts in Terms of the Common Law

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People, especially home owners, often want to dictate to their appointed Contractors how and at what pace the Contractor should do their work – say with the installation of a new kitchen or with the extension of their house.

The Common Law generally governs building contracts. In Roman-Dutch law this type of contract falls under the category of letting and hiring of work. I.e. the Contractor supplies all the materials and labour to execute and complete the finished job.

The Contractor performs as an independent Contractor and the Contractor does not provide a service per se, but rather to produce a particular result.

The person who supplies the Contractor with the work and who engages and remunerates the Contractor, is the Employer. However, it is important to note the distinction between the Employer and the Contractor. In terms of our Common Law the Employer does not prescribe the pace of the work or the manner in which the work is conducted.

In the absence of an agreement between the Parties, the Contractor must perform the work in a manner and pace chosen by him as long as he completes the works by the agreed due date in terms of the requirements of the contract.

Similarly, if the Parties have not agreed otherwise and the Common Law is not altered by an agreement, the Contractor will only become entitled to payment once the entire works are completed in accordance with the contract.

At Common Law under a construction contract the Contractor impliedly warrants:

• That he has the ability to execute and complete the works in terms of the original contract -  and he is obliged to carry out any additional work necessary to achieve completion of the works;
• That the works will be executed in a good and workmanlike fashion;
• That the completed works will be free from defects;
• That the materials used will be free of defects (except if the Employer specifies the materials);
• That the works upon completion will be reasonably fit for purpose;
• All work done by the Contractor must comply with building and other regulations.

The Employer under Common Law inter alia implies that:

• He will be co-operative, by for example giving possession of the site to the Contractor and by supplying the necessary plans and instructions to the Contractor within a reasonable time.

• Further, it is implied that the Employer may not deprive the Contractor of possession.

The Employer is also not allowed to make unilateral instructions to the agreed scope of work.

Did you know? In the absence of an agreement on the contract price, the Contractor is entitled to reasonable remuneration.

I will discuss modifications of the Common Law and Construction Contracts in a further article.

Martin Vermaak

Director