Construction Law in South Africa

The Basic Role of Construction Law in South Africa

Construction law in South Africa regulates the building industry of the country. It is a flexible body of law that is also dynamic, as obligations and rights of parties in the construction industry of South Africa change over time. In essence, construction law covers the contractual principles associated with the duties and rights of parties to a construction contract.

Construction law in South Africa covers everything from labour relations and contracts, to workplace-related injuries and guarantees. An important aspect covered is that of contractor and sub-contractor payments, and short payments or contra charges after completion of their obligations in terms of the construction contracts.

Many contractors do not have the money to pursue legal steps in getting compensation for the work done according to the contract requirements. Various smaller operators go out of business because of such, which is why we offer assistance on a no-win, no-fee basis regarding recovering of money owed to the client.

Another important aspect covered by construction law in South Africa is that of the responsibilities of parties to the contract. It is essential to draft a contract that is unambiguous, and stipulates the terms and conditions of payment, obligations of all parties to the contract, timeframes, and resource provision.

The agreement must meet the requirements of a contract and must be fair. Many disputes develop around technicalities in the construction contracts. It is thus essential to have attorneys specialising in construction law in South Africa draft or at least review the wording of construction contracts, in order to minimise the risk of misunderstandings.
Where disputes do arise, you can also make use of our dispute resolution services, helping all parties to come to an agreement through a fair and transparent process.

It is furthermore important to consider construction law in South Africa in relation to international standards and regulations, since many agreements that are signed are between local and foreign service providers. You will appreciate our pre-agreement advice, arbitration and dispute resolution services, drafting of contract services, and litigation expertise in the above regard.

Other aspects involved in construction contracts include breach of contract, insurance law, delays in service delivery, delays in payment, variations, guarantees, penalty clauses, and occupational health and related safety matters.

Construction law in South Africa can thus not be used in isolation. There are workers involved in such projects, which means that labour laws apply. Clients have rights regarding product and service quality, and have protection under the Consumer Protection Act. This means that you must also consider the Consumer Protection Act when it comes to disputes between clients and the contract company.

Issues related to subcontractors often cause disputes. One, for instance, needs to understand that the employer cannot demand performance from the subcontractor directly. However, performance can be compelled from the employer’s agreement with the contractor by means of remedies for non-performance of a sub-contractor. The sub-contractor agreement terms are normally only settled once the contractor has an agreement in place with the employer. There is thus a main agreement and from it follows the sub-contractor agreements.

From the above, it becomes clear that construction law in South Africa covers complicated matters. It is thus best to make use of experienced attorneys to draft, review, and amend agreements to ensure fairness and clarity in the agreements.

Guarantees are common practice in the construction industry. The guarantees are securities for the payment for performance and to secure performance of the contractor. One must understand that there are restrictions to any types of guarantees. It is best to seek legal guidance on how to word guarantees, what to do regarding non-performance, and how to ensure fairness.

Call us on +27 (0) 11 234 2125 for legal assistance regarding any aspects related to construction law in South Africa.


Disclaimer: This article is for information purposes only and does not constitute legal advice. Call on our attorneys for legal advice, rather than relying on the information herein to make any decisions. The information is relevant to the date of publishing – June 2018.

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