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the use of force majeure in a building contract.

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edna.welthorpe36638

516

Posts

EW GURU

Latest post on 09 August 2011 - 07:35

given the civil law structure in UAE I don't think presedence of other cases doesn't compel the courts to take other rulings into consideration. Correct, previous cases do not set precedents in the UAE.

164

Posts

EW NEWBIE

Latest post on 09 August 2011 - 06:49

17. FORCE MAJEURE out of a contract from Nakheel “Event of Force Majeure” means an act of God including but not limited to fire, flood, earthquake, windstorm or other natural disaster; act of any sovereign including but not limited to war, invasion, act of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion, revolution, insurrection, military or usurped power or confiscation, nationalisation, requisition, destruction or damage to property by or under the order of any government or public or local authority or imposition of government sanction embargo or similar action;labour dispute including but not limited to strike, lockout or boycott; interruption or failure of utility service including but not limited to electric power, gas, water or telephone service; failure of the transportation of any personnel, equipment, machinery or material required by the Seller for completion of the Building; delay for any reason by any contractor or subcontractor in carrying out their works or any matter; or cause beyond the control of the Seller Well, looks like every single scenario has been covered here to me? You sure Force Majeure in Dubai means the same things as everywhere else in the world? The nakheel force majeure contract is a very good example of a clause where the developer has defined what it means. If your developer has not defined it like this then a lot of these items, under common practice in Dubai, are not considered force majeure. A lawyer could argue whatever the defintion in the construction contract is, is what the developer assumed would be grounds for force majeure. If they have a good saavy contractor utility supply will either be a force majeure clause or more traditionally can simply be the responsibility of the developer. Best to get a lawyer to comment on it. Force Majeure is just one of those clauses that developers and contractors try to hang their hat on and given the civil law structure in UAE I don't think presedence of other cases doesn't compel the courts to take other rulings into consideration.

870

Posts

EW GURU

Latest post on 09 August 2011 - 00:39

hi thanks for all the replies, much appreciated. but would they have to include the no electric and no water in the contract under force majeure, as ours is just basic without any particular problems like earth quake , volcanos or no power or water for example. its rak not dubai sorry for not specifiyng. thank you

Hello.Again.Kitty

1861

Posts

EW EXPERT

Latest post on 04 August 2011 - 16:11

17. FORCE MAJEURE out of a contract from Nakheel interruption or failure of utility service including but not limited to electric power, gas, water or telephone service; failure of the transportation of any personnel, equipment, machinery or material required by the Seller for completion of the Building; delay for any reason by any contractor or subcontractor in carrying out their works or any matter; or cause beyond the control of the Seller rofl! Loving the transportation bit - oh, my bus broke down, so I couldn't get the chaps to the site to finish your house, sorry, but "force majeur". No mate, force majeur in that case may be if there were no busses to be had anywhere in the Emirate, but last I heard there were such things as "hire companies". "Normal" delays are NOT force majeur in any standard building contract - in the UK at least. As for utilities not being connected, that smacks of p*ss poor planning on the developer's part. Don't think "incompetence" is usually force majeur, but here, well... it seems a true work ethic. Again, I'm no lawyer, but I would say that under "normal" contract law, if the developer can't have the product up and running on time due to poor planning, then it's them breaking the contract and the investor should be able to have a refund and walk away. <em>edited by Hello.Again.Kitty on 04/08/2011</em>

1575

Posts

EW EXPERT

Latest post on 04 August 2011 - 16:04

Good articles MrsO. As I said before, Force Majeure in Dubai takes on a whole new meaning. Very interesting

137

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EW NEWBIE

Latest post on 04 August 2011 - 15:57

A few interesting articles on the subject http://www.zawya.com/story.cfm/sidZAWYA20100729044500/?relcontent=ZAWYA20100328042415 http://thedubailaw.com/dubailaw/2010/12/investors-should-use-force-majeure-to-withhold-payments/ http://www.thenational.ae/thenationalconversation/industry-insights/property/use-of-force-majeure-in-gulf-is-all-in-a-good-clause http://www.thenational.ae/business/property/act-of-god-cited-for-no-refunds-on-dubai-schemes Edited to add a few links. edited by MrsO on 04/08/2011 <em>edited by MrsO on 04/08/2011</em>

137

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EW NEWBIE

Latest post on 04 August 2011 - 15:53

http://www.internationallawoffice.com/Newsletters/detail.aspx?g=5efc9070-7bf5-4cd0-a979-20369d495a26 this link will give you the formal definition and also the variances depending on the contract type and jurisdiction. It also provides details of what can be classed as "force majeure" Most developers here in the UAE use AMENDED versions of FIDIC - usually amended in their favour. Your contract needs to be checked out by a lawyer familiar with construction contracts and UAE law. I wouldn't take anyone unqualified persons view on this as as it will need full review of the contract terms and conditions.

Princess_I45169

1953

Posts

EW EXPERT

Latest post on 04 August 2011 - 15:45

interruption or failure of utility service including but not limited to electric power, gas, water or telephone service; There you go - in the contract; no power and no water = force majeur

1575

Posts

EW EXPERT

Latest post on 04 August 2011 - 15:36

17. FORCE MAJEURE out of a contract from Nakheel “Event of Force Majeure” means an act of God including but not limited to fire, flood, earthquake, windstorm or other natural disaster; act of any sovereign including but not limited to war, invasion, act of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion, revolution, insurrection, military or usurped power or confiscation, nationalisation, requisition, destruction or damage to property by or under the order of any government or public or local authority or imposition of government sanction embargo or similar action;labour dispute including but not limited to strike, lockout or boycott; interruption or failure of utility service including but not limited to electric power, gas, water or telephone service; failure of the transportation of any personnel, equipment, machinery or material required by the Seller for completion of the Building; delay for any reason by any contractor or subcontractor in carrying out their works or any matter; or cause beyond the control of the Seller Well, looks like every single scenario has been covered here to me? You sure Force Majeure in Dubai means the same things as everywhere else in the world?

477

Posts

EW EXPLORER

Latest post on 04 August 2011 - 15:02

In all honesty you would need to go to a lawyer and not EW.... couldnt agree more

Princess_I45169

1953

Posts

EW EXPERT

Latest post on 04 August 2011 - 15:01

Force majeure is soemthign that is beyond their contrrol - if DEWA haven't got the grid capability for the buidlign then i would have thoguht that would qualify. In all honesty you would need to go to a lawyer and not EW....

1575

Posts

EW EXPERT

Latest post on 04 August 2011 - 15:01

I think the hundreds and thousands of investors who are waiting for their properties to be handed over without compensation would disagree

477

Posts

EW EXPLORER

Latest post on 04 August 2011 - 14:59

disagree derien. force majeure is force majeure ... in dubai, europe, us, africa. it is a standard clause and any solicitor will fight this tooth and nail. "this is dubai" will not stick in a court of law ... not even here.

1575

Posts

EW EXPERT

Latest post on 04 August 2011 - 14:58

Anything can be invoked as Force Majeure... This is Dubai. Personnaly, I don't think that lack of water/power connection qualifies as force majeure as you can set up a generator. I really think they are just trying it on to avoid paying the penalties <em>edited by derien on 04/08/2011</em>

477

Posts

EW EXPLORER

Latest post on 04 August 2011 - 14:57

force majeur has nothing at all to do with generators and water. it's "higher power", i.e. acts of god (natural disasters, war etc) they're trying to pull a fast one.

870

Posts

EW GURU

Latest post on 04 August 2011 - 14:24

do you know what legally can be enforced as force majeure for delay of a building being finished, can the lack of power and water be argued as NOT a force majeure, as a generator and water can be provided if a building is almost finished. this company are trying to enforce a year delay with force majeure due to power and water not being available at this time for handover. thanks for any help.

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