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Hong Kong – Is An Architect’s Sub-Contract Certificate of Non-Completion A Condition Precedent To A Main Contractor’s Claim For Delay Against The Sub-Contractor?
7 September, 2013

Legal News & Analysis – Asia Pacific – Hong Kong – Dispute Resolution

 

In 2005, the Hong Kong Institute of Architects, the Hong Kong Institute of Construction Managers and the Hong Kong Institute of Surveyors published a new edition of the Standard Form of Building Contract. The previous edition was published in 1986, and was based on the English JCT standard building contract, 1963 edition. This article will discuss a vexed question arising out of the Standard Form of Nominated Sub-Contract (commonly known as “the Green Form”) for use where the Sub-Contractor is nominated under the 1986 edition of the Standard Form of Building Contract. This edition is still in common use in Hong Kong private projects, despite the publication of the new edition 8 years ago.

 

When the completion of a project has been delayed, it is often difficult to ascertain which party is responsible. Clause 8(a) of the Green Form provides that if the nominated sub-contractor fails to complete the sub-contract works, it will be liable for the loss or damage suffered by the main contractor and caused by the failure of the nominated sub-contractor as aforesaid with the following proviso:-

“Provided that the Main Contractor shall not be entitled to claim any loss or damage under this clause unless the Architect shall have issued to the Main Contractor (with a duplicate copy to the Sub-Contractor) a certificate in writing stating that in his opinion the Sub-Contract Works or the relevant section thereof ought reasonably to have been completed within the specified period or within any extended period or periods as the case may be.”

 

So, is the issue of a Sub-Contract Non-Completion Certificate a condition precedent to the entitlement of the main contractor to claim loss and damage for delay against the nominated sub-contractor? Main contractors will argue that although no such Certificate has been issued, they can still rely on their common law right to claim against nominated sub-contractors and in any event request the arbitrator in the sub-contract arbitration to regard that such Certificate had been issued if the nominated sub-contractor is found to have caused delay in completing the sub-contract works.

 

There are various authorities in both England and Hong Kong touching on this vexed question. Given the current judicial attitude, it is likely that the Court will answer the question in the affirmative. We will discuss the various arguments usually put forward by main contractors and nominated sub-contractors in a more detailed separate article and so readers interested in this topic should keep an eye out for this.

 


For further information, please contact:

Cheung Kwok Kit, Partner, Deacons
kwokkit.cheung@deacons.com.hk




 

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