UK Law and Practice Contributed by: Colin Rodrigues and Harminder Sandhu, Hawkins Hatton Corporate Lawyers Ltd
6.22 Termination by a Third Party A lease could be terminated by a third party (eg, the government) if the public interest so required. For such a process to take place, the requisite public law requirements/criteria would need to be met and, where relevant, compensa - tion would be payable. 6.23 Remedies/Damages for Breach On termination of a lease, a landlord is entitled to pursue a tenant for damages to be compensated for the loss arising out of the tenant’s breach of the lease terms, whether that be non-payment of rent or failure to maintain/repair the premises or wider damage to the property. The issue faced by the landlord is demonstrat - ing the diminution in value of its property due to the damage or disrepair, coupled with the land - lord’s general duty to seek to mitigate its losses. The landlord would have the rent deposit at its disposal, to seek to recover some of the losses sustained. The landlord also has to be mindful of the extent to which any property damage is covered by property insurance. 7. Construction 7.1 Common Structures Used to Price Construction Projects Lump-sum or fixed-price contracts comprise a total fixed price for all construction work. They are the most commonly used form of contract. Cost-plus contracts comprise payment of the actual costs, consumptions or other expenses relating directly to the construction work. Measured contracts define the buildings that will be covered by the work, the period over which
work may be required and an estimate of the likely total value of the work. 7.2 Assigning Responsibility for the Design and Construction of a Project The “traditional” procurement method, often referred to as “design bid build”, is the most commonly used method of procuring construc - tion work. This is where design consultants are appointed to design the project in detail, and contractors are invited to tender for the con - struction of the designed project. The design consultants are responsible for the design and the contractor is responsible for the construc - tion work. The “design and build” procurement method, as its name suggests, is where the contractor is appointed to design and construct, as opposed to a traditional contract where the client appoints design consultants to design the development and a contractor is then appointed to construct the project. 7.3 Management of Construction Risk A percentage (often 5%) of the amount certified as due to the contractor on an interim certificate is deducted from the amount due and retained by the client. The reason for the retention is to encourage the contractor to discharge its duties fully under the contract. Limitations and Exclusion of Liability The three most common methods of limiting liability are: • caps on liability, where the amount payable in the event of a breach is capped; • net contribution clauses, where a claim - ant must pursue a claim against all parties responsible for damage to seek full recovery of loss; and
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