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PROS AND CONS OF INTERNATIONAL ARBITRATION IN GLOBAL CONSTRUCTION PROJECTS

International arbitration is a method by which parties to a global construction project may resolve their disputes without resorting to the courts of a foreign country. It is generally the preferred method for resolving disputes. There are both advantages and disadvantages to international arbitration.

Contractor's Core Duties Pursuant to Construction Contract

With respect to a construction contract, a contractor must fulfill certain basic obligations. These core duties usually arise expressly from the language of the contract.

Delay Claims Against Third Parties

On a construction project, it is not always the fault of the owner or contractor when a delay occurs. Sometimes, the delay results from the action or inaction of a third party. A prime third party whose negligence can severely hamper the progress of a construction project is the architect or engineer.

Underpayment by the Owner

An owner "underpays" his contractor when he submits a progress payment for less than the full amount to which the contractor is entitled. Not only does an underpayment affect the contractor, but it also has very real consequences for the surety. If the contractor defaults, which may be likely if he does not receive his full payment, the surety is then obligated to step in.

AN OWNER'S IMPLIED WARRANTY REGARDING PLANS AND SPECIFICATIONS

Plans and specifications are the means by which an owner, a design professional, and a contractor communicate in a construction project. If an owner hires a design professional, the design professional is generally responsible for any defects in the plans and specifications. If an owner hires a contractor to design and to build a construction project, the contractor is generally responsible for any defects in the plans and specifications. However, if the owner supplies the plans and specifications to the contractor, the owner may be responsible for any defects in the plans and specifications.