Implied Obligations in Construction Contracts

Association of Construction and Development
March 12, 2013 — 4,059 views  

The two types of warranties are implied and express. The former are created by the courts, legislation or the law while the latter comes in contracts or could even be a verbal contract. Construction contracts are meticulously created so that all the specifications are clearly defined. It is vital for contractors, owners, and designers to carefully consider these implied obligations.

The Plans and Specifications

This is one of the most prominent warranties and relates to the adequacy of the specification and plans. It is also known as the Spearin Doctrine and states that if the contractor finishes the work according to the owner’s plan and specification, but there is a failure or deficiency of any kind, the owner is responsible and not the contractor. Some other responsibility might be shared by the engineer too.

Implied Duty Not To Hinder or Delay

It is implied by contracts that parties who sign the contract should cooperate with each other. They should not delay or interfere with the work of others and should facilitate each other’s performance. The typical obligations that fall under this law relate to the design, construction, and also the materials involved.

Access to the Site

This duty could be a result of specific clauses in the contract or could just be independent. The contractor’s work could be hindered by the owner’s visit to the site. So this clause helps evade that situation.

Implied Duty to Coordinate Multiple Prime Contractors Or Subcontractors

Normally, owners sign contracts with a contractor who then signs contracts with several trade subcontractors. The general contractor is required by law to coordinate with all the subcontractors. But in contracts that are of the multiple prime nature, the owner directly deals with all the contractors and traders on the project as opposed to a general contractor.

Implied duty to provide adequate supervision

A contract could imply duties to offer substantial supervision in terms of personnel on a project. But excessive supervision could be in breach of the contract.

Implied Duty of Good Faith And Fair Dealing

All construction contracts have an implied duty related to fair dealing and good faith. According to this clause the parties involved will not do anything that deprives the other parties of benefits linked to the contract.

Any act that would make the contract’s performance hard or impossible should be refrained from and it is the duty of the parties to do all that is presupposed according to the contract so that all parties will accomplish their purpose.

Implied Duty to Ensure A Safe Workplace

The duty to ensure the workplace is a safe one may vary from one project to the next. Sometimes this duty will be the responsibility of the contractor, subcontractor, or even the developer or owner. It may even belong to several people sometimes.

Commonly, an employer who is in a contract with an independent contractor is generally not responsible for any injuries that are sustained by the employees of the independent contractor.

Association of Construction and Development