Contract Drafting for Major Plant Construction

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The selection of the time unit when defining the Time for Completion of the Works can tilt the scales if there is a conflict between the contract parties. Even though handing time units is easy in daily parlance, it can be extremely difficult in case of a conflict, especially if big money is involved.

What is a “month”? Is it 30 continuous days? Or is it the time span between the first and last day of a month? At what time does the first day of a month start and when does the last day of a month end? What about months that have a number of days which is different from 30? Appropriate definitions are recommended in the introductory part.

Plant construction takes place mostly at places where the contractor usually does not have his main place of business. These places have holiday rules that are different from the rules that apply in the city of the contractor. This factor must be considered in the contract when defining the relative fulfilment dates, e.g., by defining applicable holiday rules for different sites of the project in the introductory part of the contract.

Commencement Must be Announced Meticulously

The coming into full force of a project contract must be announced meticulously due to the considerable risks linked to the commencement for the contract parties. Expression of delight, that the project can be implemented finally now that the “contract has been signed hurriedly and it has come into effect before the other party changes its mind” should be avoided. Meticulousness is recommended here.

* * Head of Consulting at 11:55 PM consultants GmbH, Potsdam.

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Major Plant Construction

Contract Drafting for Major Plant Construction – How it's Done

Commencement Must be Announced Meticulously