Construction and contracting disputes

What is happening

The contractor has completed the works and sent the KS-2 completion certificates and KS-3 cost statements, but the employer is silent or returns them with vague remarks such as 'poor quality'. Nothing is paid, yet the building is already in use.

The employer sees the programme has slipped and quality is questionable, and wants to terminate, recover the unearned advance and bring in another contractor. That has to be done without ending up paying for works effectively accepted and without losing the right to a penalty.

A subcontractor carried out extra works on the general contractor's verbal instructions, and the variation was never signed. The general contractor refuses to pay, relying on the fixed contract price.

What the law says

• The relationship is governed by Chapter 37 of the Civil Code on work contracts, including the special rules on construction contracts; for state and municipal employers Federal Law No. 44-FZ of 5 April 2013 "On the Contract System for the Procurement of Goods, Works and Services to Meet State and Municipal Needs" (the Public Procurement Law) also applies.
• A unilateral completion certificate can be declared invalid only if the court finds the employer's reasons for refusing to sign justified (Article 753 of the Civil Code). So unexplained silence usually works against the employer.
• As a general rule a contractor cannot require payment for extra works not agreed with the employer; the exceptions concern situations where immediate action was needed in the employer's interest.
• The employer may withdraw at any time on paying for the works performed (Article 717 of the Civil Code), or withdraw because of the contractor's breaches; the ground chosen determines the consequences, including damages.
• Disputes over volume and quality are almost always resolved by a construction expert examination; much depends on the questions put to the expert and the documents they receive.
• Release of retentions and security payments is governed by the contract; what happens to them on termination is often a dispute in its own right.

What we do

• We analyse the contract, estimates, programmes and as-built documentation and reconstruct the chronology of the works and correspondence.
• With engineers and quantity surveyors we assess volumes and quality before any court action.
• We prepare a reasoned refusal to accept or, conversely, the documents to support a unilateral certificate.
• We frame the questions for the expert, take part in choosing the expert body and attend the site inspection.
• We calculate the value of the works, penalties, damages and the final account between the parties on termination.
• We represent the company in the commercial court, including in disputes under state and municipal contracts.

What we will need from you

• The works contract with annexes, estimates, programmes and variations.
• KS-2 certificates, KS-3 statements, hidden-works inspection reports, the general works log and as-built documentation.
• Correspondence, minutes of site meetings, instructions from technical supervision and the employer.
• Photos and video of the site, if available.
• Payment records and details of advances and retentions.