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C O N S T R U C T I O N E M P L O Y E R S F E D E R A T I O N T H E V O I C E O F T H E I N D U S T R Y

“With completion deadlines and hectic schedules, getting a contract agreedprior toworks starting is a recurring concern in the construction industry.”

matters most is what the documents say; however the parties conduct will also be examined by the Courts or an adjudicator. With completion deadlines and hectic schedules, getting a contract

• The letter of intent should make clear what its legal effect is once the formal contract is entered into. • Letters of intent often have financial caps or time limitations. It is best to ensure that these limitations do not expire before a formal contract is entered into as this creates legal uncertainty. • When entering into the formal contract in circumstances where a letter of intent has been used it is best to expressly deal with prior works, ensuring that there is no doubt as to whether they are covered by the formal contract or not.

agreed prior to works starting is a recurring concern in the

construction industry. Couple this with this decision of the Technology

and Construction Court, it is important to bear in mind:

• It simply isn’t always possible to enter into a full formal contract before works start, but it is best to do so. • If works are starting before a formal legal agreement is entered into, it is best to make sure there is some interim agreement in place. This can take the form of a letter of intent. • Letters of intent are designed to be superseded by a formal contract – often the existence of a letter of intent and the commencement of works take the focus away from finalising the formal contract – it is best not to let that happen.

If you have a query regarding the article, or any construction related matter, please contact Adrian Kerr,

Head of Construction at T: +44 (0) 28 9024 3878 E: info@millsselig.com www.millsselig.com

Adrian Kerr, Head of Construction, Mills Selig.

www.northernbuilder.co.uk

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