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Part 1: The Lowdown of Significant Risk-Allocation Clauses

In a recent article published by Construction Business Owner, J. David Arkell discusses how recognition and allocation of risk should be major concerns for all parties involved in a construction project and outlines some of the most significant risk-allocated clauses and their importance to the parties. 

“A well-drafted indemnity clause can help protect a general contractor against having to indemnify clauses in construction contracts,” Arkell explains. “Such legislation generally precludes any indemnity provision requiring one party to indemnify another for the results of the other’s negligence or other fault.” 

He further discusses pay-when-paid clauses, waivers of lien and bond rights, as well as the differing site conditions at construction sites that were unknown when the contract was executed. 

“Examples include a high-water table, expansive soils or other subsurface conditions, and characteristics of existing structures on the site. A differing site condition clause allocates the risk of changes in the scope, cost and time resulting from such conditions.”

Read the full article in Construction Business Owner.   

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