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| Lecture Contents |
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| Basic Principles
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It is necessary that the appointment
of an arbitrator (DAB) should be made within 28 days of the commencement
of construction according to the deliberation of the construction
supervisor.
Communications between the order placer, constructor, and construction
supervisor should be made smoothly (Article 1.3).
Also in case the order placer demand a revision, it should be
notified to the construction supervisor, and then the construction
supervisor should notify the constructor of it in writing.
The laws of the concerned states should be included in the contract
terms and conditions.(Article 1.4). It's a new type of contract
wherein when a dispute arises, the construction supervisor is
not existing but a DAB is existing.
The language for communication should be in writing. In the case
of an international contract, Article 1.4 should be complied with
concerning the laws and the language. |
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| Contract and Responsibilities |
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Responsibilities
of Order Placer : Appointment of the construction supervisor,
preparation of the construction site, the constructor support,
preparation for payments, notice to the constructor of special
terms and conditions, payment of contract money, the responsibility
for agreement on the appointment of DAB and for the use right
for a certain person, and any problem arising from the failure
of the constructor to confirm the boundaries of land, namely failure
to obtain the use right for land to transport materials, and the
report on the financial conditions of the order placer upon the
constructor's request must be notified to the constructors, and
if not, the construction work can be stopped, so the order placer
should be responsible for that.
Responsibilities of Construction Supervisor
: Construction supervision, re-confirmation of the approval
of the order placer on special items, balancing fairness between
the order placer and the constructor, the payment of the price
of construction confirmed by the construction supervisor pursuant
to Article 14.7 shall be made by the order placer, and the construction
supervisor shall judge the price after consultation with the constructor
and the order placer, and the construction supervisor should have
obtained the rights of construction supervisor from the order
placer.
Responsibilities of Constructor :
Appointment of the construction manager as the representative
of the constructor and delegates the constructor's work to the
construction manager, commencement of construction, construction
according to the construction schedule without any delay, submission
of 12 copies of the progress report of construction should be
made in two sets each month of which the contents should include
labor, working methods, explanation, assessment, production, construction,
plans, etc., and request for the issuance of the certificate of
provisional payment, the appointment of subcontractors, and minimizing
any risk for delaying the construction by performing its role
of mediating between employees of order placer and government
or public officials. |
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| Time Management
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Construction should commence within
42 days (Article 8.1 )
The period of construction includes the test operation (Article
8.2 )
Construction shall continue unless any change is made within 21
days after the program has been submitted.
Any extension of the construction completion shall comply with
the standard procedures (Article 8.4 )
Construction suspension (Article 8.8 )
Test operation (Article 9 )
The certificate of the amount of order shall be submitted at the
time when the preparation for construction is completely ready
(Article 10 )
Recognizing the construction process according to the certificate
of it, the procedure for the notification of loss (Article 11
)
If the construction period needs to be extended due to a unexpected
situation, that applied to Article 4.12. When a terror occurs
in Israel or a change takes place to the surface of the ground,
that should be notified to the construction supervisor. However,
matters due to a change to the climate are not applied, but a
typhoon can be considered.
Environmental preservation construction applies to Article 4.18
including the Kyoto Protocol on the concentration of exhaust carbon.
For example, a resident in a tropic rain forest died after drinking
the water near a site sewage treatment plant, and the residents
protested about it. |
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| Finance Management |
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Assessment shall be made on the actual
construction progress according to the schedule (Article 12 )
The constructor shall make written provisions on the rooming,
meals, etc. of subcontractors as separate stipulations. (Article
6.1) because the constructor shall provide conveniences to all
workers in connection with the performance of the contract under
the terms and conditions of the contract.
The constructor shall be responsible for the price calculation
according to grades under the terms and conditions of the contract
and for the compensation for any omitted work of the construction
(Article 12.4 )
The construction supervisor and the constructor shall share risks
and profits in connection with the construction at the same rate.(
50 : 50 )
The basic rates for pricing shall be confirmed 28 days prior to
the submission of bidding documents
In expectation of the advance contract down payment, the provisional
payment to the constructor shall be mutually checked. (Article
14)
The certificate of the construction provisional payment shall
have stipulations which make a change of a future payment be made
within the scope of 3% discount rates or higher of the country's
central bank. (Article 14.7) |
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| Contract Termination,
Risk, Insurance and Force Majeure |
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The order placer shall, if any due reason
for terminating the contract occurs, notify the constructor of
it within 14 days.
The termination of the contract by the order placer shall be effective
28 days after the notification. (Article 15.3)
The constructor shall, if any due reason for terminating the contract
occurs, notify the order placer of it within 21 days. (Article
16.1)
Risks shall be handled by mutual trust between the order placer
and all concerned contract parties. (Article 17.6)
The insurance shall include the entire construction process, the
equipment and machinery of the constructor, the individual insurances
of the constructor, the order placer indicated in the letter of
bidding intention, the insurance of the constructor, and the insurance
of the construction supervisor. (Article 18)
The force majeure means SARS, typhoon, war, etc. In the case of
force majeure, the rights for adjusting the time and contract
money shall be given to the constructor. (Article 19.4)
In the case of force majeure, any selective termination of the
contract shall be made by agreement between the order placer,
the constructor and the construction supervisor. (Article 19.6
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| Claim, Dispute,
Arbitration |
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The constructor shall submit claims
within 28 day. (Article 20.1)
The construction supervisor shall make a decision on the presented
claim to accept or reject. - mutual communication is essential
DAB appointment (Article 20.2)
DAB fees shall be paid by the order placer and the constructor
at the ratio of 50 : 50.
DAB shall submit a written arbitration to the order placer, the
constructor and the construction supervisor. (Article 20.4)
DAB shall commence his arbitrating within 84 days. (Article 20.4
)
If the order placer, the constructor or the construction supervisor
has not presented an objection to the arbitration within 28 days,
the arbitration shall be considered as accepted.
If an objection(N OF D) is presented within 28 days, the case
will be turned to the arbitrators within 56 days. (Article 20.6)
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