Like most legal questions, we find it easiest to think about the position by reference to a scenario. The contractor has become insolvent. Before it became insolvent, the contractor was in the process of procuring a specialist air conditioning HVAC unit that is intended to be incorporated into the works. We will consider the position from the perspectives of the employer and the supplier.
We have assumed that business to business contracts are in place that contain specific provisions in relation to the title of goods. If there are no such provisions the Supply of Goods and Services Act for construction contracts and Sale of Goods Act for supply contracts will apply. It becomes the property of the employer as part of the land that it owns. This is the case whether or not the employer has paid for the HVAC unit.
If the HVAC unit has been incorporated into the land, but the employer has not paid for it, the employer will remain liable to the insolvent contractor for those costs. If the HVAC unit is sitting on site, but not yet incorporated into the works, the contract terms will be important. Under the JCT DB , the contractor or its insolvency practitioner is not entitled to remove any such goods from site, even if they have not been paid for clause 2.
If the items are Listed Items then special conditions apply which will also need to be checked. The JCT Design and Build Contract similarly provides that title for materials and goods passes when their value has been included in an Interim Payment for goods on site.
The NEC3, in contrast, provides for title to pass on delivery to site rather than on payment. Under clause As set out above, payment may not get the employer title if there is a retention of title provision further down the chain where the contract is not a pure goods contract. There may also be a retention of title clause sometimes known as a Romalpa clause 15 in the contractual chain whose terms need to be considered.
Retention of title clauses come in a number of different forms, with the simplest being the most likely to work. Since Romalpa it has been clarified that 3 will not work to give the supplier any security in the context of an insolvency unless a charge has been registered over the goods. However, a Basic Retention of Title Clause can still be a valuable tool especially where it is combined with a licence to enter a property and retake the goods if payment is not forthcoming.
Self-help remedies are not uncommon in the immediate aftermath of an insolvency event and are one of the reasons that, for the employer, securing the site is a top priority.
However, those thinking of self-help remedies need to be sure that they own the goods. That can be difficult to establish. It is not uncommon for retention of title clauses to expressly allow re-entry to a property to take possession but those seeking to exercise that right need to be careful that: 1 the contract they have is with the landowner where the goods are held; and 2 the goods have not been purchased in good faith, attached to the land or mixed so that title in them no longer rests with the supplier.
If title has transferred then the party removing the goods may be liable in conversion. If there is no right to re-enter to take possession, then there is a range of other remedies available although they may take time to pursue. For example, it may be possible to get an order for delivering up or a restraining order to prevent the Liquidators or Administrators from parting with the proceeds of sale.
Suppliers who have title may also want to argue that any goods that are subject to a retention of title clause are held on trust for them allowing them to stand ahead of unsecured creditors in the insolvency. As for insolvency practitioners, well they are faced with the unenviable task of trying to establish who does own those goods, often in circumstances where information is distinctly lacking. If you would like to receive a digital version of our newsletters please complete the subscription form.
Most of the time the sales portion of the project can be the most difficult and interaction and shopping for the correct expertise in such sales if usually of critical importance.
Ultimately, the title companies will determine when escrows close and a part of the project all too often ignored is making sure title is clear and unambiguous.
This is particularly important in subdivisions with large common areas or with the far more common Tenancy in Common methods of ownership used more and more in California cities. The time to engage in such planning is long before the project ends so that by the time the real estate brokerage house is given the assignment of selling the project title is either not a question or a Quite Title Action has been brought to ensure appropriate salable lots. The creation of improved property can be one of the most satisfying of all occupations.
One sees land developed capable of providing homes or offices for people; one can participate in the creative process and be part of those who create beautiful things that may last for generations.
Consider: when you think of great cities or civilizations, more often than not it is the buildings that seize the imagination and most buildings of most great cities were built not by the government but by private owners much like here.
Paris may have beautiful public buildings but it is the private apartment houses and homes that give the city its unique charm. But to counter that creative and often profitable advantage is the need to take risk and master a entire galaxy of skills and the above list is only the beginning. Getting experienced assistance is a must for the new developer and retaining a flexible mind, keeping alert to the innumerable problems that inevitably arise…and keeping a sense of humor are all central metal preparation for this remarkable challenge.
But if one stares at the landscape and sees the tens of thousands of structures built in just the last twenty years it is clear that the challenge, while major, is by no means impossible and after the first project is completed one can create systems that often work on their own to control the project.
As with most things, it is the first steps that are the hardest. And, as with most things, it is well worth while for many people to take up the challenge.
No pain-no gain. Founded in , our law firm combines the ability to represent clients in domestic or international matters with the personal interaction with clients that is traditional to a long established law firm. Home articles role owner construction project doing more writing checks. Owner duties and responsibilities that have arisen in typical disputes include: 1. Providing financing for the project. Providing site surveys. Securing and paying for easements. Warranting the plans and specifications.
Warranting owner furnished materials. Disclosing superior knowledge. Acting on clarifications and changes. Interpreting the documents. Cooperating with the contractor. Selecting all professionals on the project. Interacting with various governmental bodies. Interacting with title companies to facilitate the sales. Related issues include: a The timing of payables Payments to the contractor are typically made after receipt of each invoice within the time period specified, or within the requirements of appropriate legal statutes.
Providing site surveys It is the owner's responsibility to provide complete and accurate relevant data, as may become necessary for correct installation of the work. Securing and paying for easements a Site access The contractor typically expects to have access to the site, even if such access is limited or restricted, as may be the case when working within a military complex, a security area of a manufacturing facility, or some similar environment, and the particulars should be made known to the contractor prior to the bid.
Warranting the plans and specifications The owner usually warrants the adequacy of the plans and specifications on many projects and, therefore, bears the responsibility for any defects or deficiencies in them. Disclosing superior knowledge The owner has a duty to disclose superior knowledge to the contractor that may directly or indirectly relate to the work, where that knowledge is either unknown by, or has not been made available to, the contractor. Action on clarifications and changes Construction contracts, whether produced by and for a private owner or public agency, recognize the need and importance of timeliness with respect to issuing clarifications and reviewing change orders.
Materials, Product, any intermediates and components of Rhythm Materials or Product, and any work in process at each and every stage of the Manufacturing Process. Manufacturer will ensure that Rhythm Materials, Product, any intermediates and components of any Rhythm Materials or Product, and any work in process are free and clear of any liens or encumbrances.
Manufacturer will at all times take such measures as are required to protect the Rhythm Materials, Product, any intermediates and components of any Rhythm Materials or Product, and any work in process from risk of loss or damage at all stages of the Manufacturing Process.
Manufacturer will immediately notify Rhythm if at any time it believes any Product or Rhythm Materials, or any intermediates and components of any Rhythm Materials or Product, have been damaged , lost or stolen. Therefore, Employer shall be the author and copyright owner of the programs on which Executive appears or for which Executive renders services pursuant to this Agreement, the broadcasts and tapes or recordings thereof for all purposes without limitation of any kind, and all materials described in the immediately preceding sentence.
All characters developed for the programs and broadcasts during the Term shall be solely and exclusively owned by Employer, including all right , title and interest thereto. The exclusive legal title to all of the aforesaid works and matters , programs, broadcasts, and materials and all secondary and derivative rights therein, shall belong, at all times , to Employer which shall have the right to copyright the same and apply for copyright registrations and copyright renewal registrations and to make whatever use thereof that Employer, in its sole and absolute discretion , deems advisable, including but not limited to rebroadcasts of programs or use of any portions of any program in the production or broadcast of other programs at any time , notwithstanding expiration of the Term or termination of this Agreement for any reason.
The North Sound BH- 5 ASO agrees to and does hereby grant to the Provider , irrevocable , nonexclusive , and royalty- 6 free license to use , according to law , any material or article and use any method that may be 7 developed as part of the work under this Contract. Contractor shall inform NACCHO in writing of any third-party rights retained within the Materials and the terms of all license agreements to use any materials owned by others.
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