UKRAINE Law and Practice Contributed by: Timur Bondaryev, Maryna Sharapa, Andrii Pidhainyi and Olena Yurets, Arzinger
7.2 Assigning Responsibility for the Design and Construction of a Project The designer and the contractor may be differ - ent companies or the same company; this var - ies from case to case. The major international companies often also involve an independent supervisory entity. In addition, the developer must appoint a per - son responsible for technical supervision (for the construction to comply with the applicable regulations), who must not be the same person as the contractor. 7.3 Management of Construction Risk From an organisational point of view, there is: • technical supervision and author’s supervi - sion; • expert valuation of design documents; • certification of construction materials; and • the developer’s control over the process. The suppliers of materials as well as the con - tractor shall give warranties on the quality of the goods and works, and shall undertake to com - pensate for any damages. A warranty of quality of works is also established by law for ten years after the commissioning of the facility. There may be a cap for damages compensation of 100% of the contract price; however, this should not cover the gravest defects/violations. Indemnifications, waivers and elaborated limi - tations of liability are not common in Ukrainian practice. 7.4 Management of Schedule-Related Risk There are penalties and fines in the majority of agreements, for delays in the delivery of mile - stones and construction completion dates.
However, there are cases where the lessee resists an out-of-court eviction. In this case, the lessor may file a suit on eviction. If the dispute is won, the lessor may evict the lessee, with the involvement of an enforcement officer and the national police. 6.22 Termination by a Third Party Ukrainian law does not allow a third party to ter - minate an agreement. However, the agreement may be challenged by a third party if its interests were violated at some stage – for instance, if mandatory corporate approvals or spousal con - sents were not obtained. The law also provides that an agreement may be invalidated if it contradicts the interests of the State and society or the moral principles of society. However, this is an exceptional meas - ure, and the authors are not aware of respective case law. 6.23 Remedies/Damages for Breach In the event of a breach of the lease (such as late payment of rent), the landlord may charge pen - alties, including annual interest on the amount owed. The landlord also has the right to keep the security deposit if the termination of the agree - ment is caused by the tenant’s breach of its obli - gations. The security deposit may be in cash or in the form of a letter of credit. 7. Construction 7.1 Common Structures Used to Price Construction Projects In the majority of cases, the price for construc - tion works will be fixed, though the price for materials may be flexible.
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