Comparison of time adjustment clauses between DZ3910, AS4000 and STCC

David Finnie


Abstract

This article examines time adjustment clauses, as they relate to time adjustment between standard terms of construction contracts. DZ3910, AS4000 and STCC were compared on the basis of how risks are allocated, how this may impact on the contractor’s pricing, and ease of understanding for each clause. ASTCC was found to be the most easily interpreted contract, followed by AS4000 and then NZS3910. These assessments were based on the following: a) whether each contract contains words with multiple meanings, b) the number of words used per sentence, c) the amount of internal cross-referencing, and d) the clarity of the contract structure. The allowable pre-conditions for the contractor to claim a time adjustment are similar for all three contracts, and none of them expressly state which party is to bare the risk of buildability, or address the risk of a designer’s disclaimer clause. All of the contracts adopt the principle of contra preferentum which means that the employer bares the risk of variance if there are any ambiguities in the design documentation. Due to their similarities of risk allocation, all of the contracts provide the employer with a similar amount of price surety. AS4000 is the only contract to contain a stringent time-bar clause, limiting a contractor’s time adjustment claim. ASTCC requires the contractor to apply ‘immediately’ and DZ3910 provides a time-bar of 20 working days or as soon as practicable. None of the contracts clarify whether their timing requirements take precedence over the prevention principle, or over any other ground for claiming a time adjustment. The effect of DZ3910’s pre-notification clause 5.19.3 is discussed, and an alternative contents structure is recommended for DZ3910, using a project management method.

 


Keywords

Contract law, Terms of contract, Time

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