Construction Law
Dire Dawa Institute of Technology Questions
Department of Construction Technology and Management
Course Title Construction Law
Course Code CoTM 4241
Assessment Type Home Take Model Examination/Worksheet
Case One (Environmental)
A Turkish company has planted a mining industry in Dire Dawa after an
international call for foreign investors made by Ethiopian Government.
The mining industry employs a very old Italy made machines which are
not environmental friendly, and naturally the raw materials in the area
have more toxic organs. Hence, it emits huge amount of Carbon
Monoxide to the atmosphere and leaks toxic liquid sediment to nearby
Lega Oda stream.
The community around the plant is suffering from skin and respiratory
organs diseases. The government, considering the problem, plans to
relocate the people to other region. However, the community firmly
objects the government plan for the land and its territory is their ancestral
land which they do not want to relinquish in lieu of development. On the
other hand, the company has established infrastructure such as road,
elementary school, clinic and sewerage and creates job opportunity for
most members of the community. The government plans to take another
action – to close the industry while the company is promising the
community to pay some amount of money. The community decides to die
with the company before the government closes it.
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DDIT-CoTM
1. What possible environmental law principles are reflected in the
above case? Write step orderly if any course of action should have
been followed or going to be followed and the possible remedies that
can be sought?
2. The community lately agreed to bring the case to a court against the
company. As an advocate of environmental law, how would you
advise them?
Case Two (Environmental)
Society of Chemical Manufacturers Association, SOCMA, is an Israeli
based manufacturer and supplier of specialty dangerous chemicals and
radioactive elements that have industrial applicability in different sectors.
The radioactive elements are specially used in detecting different signals
from the distance and they are employed to control aviation traffic by
showing the distance and direction of planes. Different chemicals
manufactured by SOCMA are used in the production of explosives in the
military field. As such the association has received orders from the
Ethiopian Air lines and from the Ministry of Defense for the importation
of these radioactive elements and dangerous chemicals respectively.
With a view to expand its flight horizon worldwide, the Ethiopian Air
Lines has a plan to construct three new international air ports at Mekele,
Jijiga, and Bahir Dar. So, the agreement between SOCMA and the
Ethiopian Air lines is to transport and install the radioactive elements in
these cities so as to facilitate flights to different parts of the world. The
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lawyer of SOCMA was so conscious that the production and distribution
of radioactive elements are banned and subject to serious restrictions on a
treaty signed at Rio. He checked different legal instruments and found
that Ethiopia is also acceding to this treaty. But the good news to the
lawyer was that none of the environmental legislations in all regional
states prohibit the use and importation to the regions of radioactive
elements.
Using this loophole, the agent of the company in Addis Ababa concludes
an agreement with Mart Importer. The importer agreed to import the
radioactive elements cautiously and to deliver them in the above
mentioned three cities but demanded huge sum of money since the
importation of the elements are dangerous. The radioactive elements were
successfully delivered and the aviation terminals were built at Makele and
Jijiga. But the surrounding community complained about the construction
of the air ports. Five pregnant women soon died and new born children in
these cities were found to be physically disabled because of rays from the
radioactive elements in the terminal.
Two buildings in each city were cracked and demolished because of the
high vibration and sound from the air ports. Five individuals that faced
hearing problem by this similar reason have spent five thousand birr for
medical expense. The process of delivery at Bahir Dar was much worse
that these radioactive elements have contaminated part of lake Tana and a
mechanized sugar cane farm owned by Midroc.
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DDIT-CoTM
Being aware of these facts, a consortium of environmental clubs from
Mekele, Bahirdar and Jijiga University students are preparing to file a case
before the court.
Questions
1. Does the consortium of environmental clubs from the three
universities have the standing /vested interest/ to take the matter
before the court?
2. Assuming that they have the vested interest; can they represent the
rights of future generations in this regard?
3. On whom the civil liability falls in this particular case? Clearly explain
the kind of civil remedy that you may award victims at Bahir Dar,
Mekele, and Jijiga.
4. Is it possible to institute a criminal action? If yes, against whom, on
what grounds and what will be the extent of the liability?
5. Can the victims in all cities bring action on private nuisance?
Why/why not?
Case Three (Land Law)
On January 2nd 2015,Dire Dawa city administration has announced in
Dire TV documentary program that in order to met the objectives of
growth and transformation of the country, the city will undertake some
measures of displacement and relocation of people from some locality of
the town such as Gendekore and Kezira. Exactly after two months, a letter
of expropriation has been sent to some residents of Gondekore and Kezira
including Ato Komche Kifle, an owner of villa with three rooms fallen in
Construction Law
450m2 in Gendekore near Smarat hotel, W/ro Tejitu Getu,an owner of a
house with two rooms fallen in 400m2 in kezira near Mekonen bar, Ato
Haile weregna ,an owner of a house of four rooms fallen in 550 m2 in
Number one near Dire Dawa High court, and Mr.Shaf Redi for his
dwelling villa fallen in 500m2 in Kezira. Accordingly, the letter states that
on April 2, 2015, these persons and other displaced persons will receive
their replacement land a size of 250m2 for construction of dwelling house
in accordance with land distribution rule of the town on the way to
Melkajabdu, four kilometer away from the center, which lacks adequate
water, road and electricity. Moreover, it stated that they will be vacated on
May 17, 2015 and paid adequate compensation for the houses only
because the administration has not adequate finance to give compensation
for the improvement made which will be determined by the committee of
five persons with necessary qualification established by the administration.
On May 2, 2015, when members of the committee are visiting the house
of Mr Shafi Redi to determine the amount of compensation, disagreement
appeared on the amount of compensation whereby the committee said
that the value will be calculated at the time of construction of the house.
The administration, as per the plan and the new land lease proclamation,
has started redistributing the land in kezira and Gendekore by lease for
investment of hotel and restaurants before evacuation process was
finalized by 50 birr for one m2 for fifty and ninety-nine years. Based on
the agreement, the investors have agreed to build five star hotels in Kezira
and Gende Kore within three years starting from lease contract. And will
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DDIT-CoTM
commence construction of the building within two months. One of the
investor Ato shenkute, after the building site is dug, reinforcement
concrete filled, its floor completed, an incidental force majure interrupts
the construction process which will postponed the completion of the
building beyond five years.
Questions
A) How can you challenge the legitimacy of expropriation decision,
process and compensation process against urban dwellers including
the resident house owned by the company?
B) Advice Ato Shenkute based on the new land leas proclamation as to
the effect of the violation of the contract with administration and
what is expected from the investor
Case Four (Contract Different Case Problems)
Instruction
 You are expected to discuss in detail every question & to give reasons
for your analysis or arguments or decision or award, as the case may
be, either from the applicable contract clauses and/or the articles of
the MDB FIDIC Version 2006, PPA 2011 & any other relevant &
valuable reference materials.
 Do not assume or add extra facts except to attempt the examination
question on given facts.
Problem 1 Price Escalation
Does the client have the right not to pay the price escalation on some
items (like fuel) unit Price that already exists on the contract agreement?
Construction Law
For what reason? How long can the Payment Be delayed after it has been
invoiced if the client does pay it .
Problem 2 Engineer’s Authority in Payments
What is the engineer’s Power in respect to payments? What is the
situation if the client disagrees with a payment that has been certified by
the engineer?
Problem 3 Contract Commencement
The Contract requires the contractor to start work within 30 days of
being given possession of site. The Contractor starts within 7 days after
getting approval from the client and the engineer. The Client thinks that
the commencement date should be the date that the contractor actually
commenced but the contractor says that the date should be 30 days after
getting possession of site and that the 23 days should not be deducted
from the time for completion. What is the correct decision? If the
contractor is correct, who pays for supervision costs for the 23 days?
Problem 4 Wet Weather Delay
The contract requires completion of the works within the time for
completion. The contractor is unable to carry out major works during the
normal rainy season and is restricted to minor works such as pipe
production. The contractor claims an extension of time for the rainy
season. Should he be granted an extension of time?
The contractor’s work is interrupted owing to adverse climatic conditions
/ unexpected rain fall.
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He claims extension of time and financial compensation for his idleness.
Should he be entitled to compensation for such Force majeure?
In the case of Force Majeure or events beyond the control of the parties,
the contractor is always granted an extension of time. Is the client
responsible for the additional costs incurred by the contractor?
Problem 5 Failure to Pay Interim Certificate
The Client does not have sufficient funds to pay the contractor. The
contractor should be Paid interest for delayed payments. Does the
contractor have the right to terminate the contract if he is not paid? If he
can, can he also claim costs other than interest?
Problem 6 Flood Damage
The contractor was carrying out the construction of a bridge. He was
ready to pour concrete for the super structure when a flash flood
destroyed form work, reinforcement and temporary works.
The Contractor has claimed an extension of time and the costs of making
good the damage is the contractor entitled to both an extension of time
and financial compensation?
There was no rain fall in the vicinity of the site. The flood was the result t
of high rain fall in the highlands, which are far away from the site. The
flooding occurred outside the normal rain season.
Problem 7 Large Increase in Quantities
During construction the quantities of some items such as borrow
materials were found to be much greater than in the Bill of Quantities.
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Can the contractor granted an Extension of time because of the higher
quantities of he makes a claim?
Problem 8 Delay in providing Drawings
The contractor requested drawings for the drainage structures. The
designs are held at the engineer’s head office and the engineer is not able
to supply the drawings on time to the contractor at site. Who is
responsible for the delay, the client or the engineer? To what extent?
Problem 9 Lack of Drawing
The Client is un able to provide drawings for a small bridge because
either they have been misplaced or the design consultant did not provide
them at the design stage. When the engineer realized that he did not have
the drawings he asked the client to provide them. The client said that he
didn’t have them and instructed the engineer to design the bridge and
provide details to the contractor as part of his design review. The engineer
advised the client that this was not his responsibility. The construction of
the bridge was delayed as a result. Who is responsible for the contractor’s
claim?
Problem 10 Right of way
The Contractor has requested an extension of time and additional
payment because of a Row problem in the middle of the length or road.
The program shows that the section should be constructed in period for
which an extension to time is claimed. The contractor could utilize his
resources to construct the rest of the road apart from the problem
section. Is the contractor’s claim acceptable?
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DDIT-CoTM
Problem 11 Shortage of Cement 1
The contractor claims an extension of time and associated costs on the
basis that he is unable to obtain cement necessary to carry out work in
accordance with his approved program. Is the contractor’s claim
acceptable?
Problem 12 Shortage of Cement 2
The contractor is complaining and claiming for the shortage of cement.
Once the government allowed for the importation of cement, the supply
situation on the market has improved. But the main cement supply
factories from which the Contractor intended to by cement are still unable
cope up with the demand. So the Contractor is complaining that he is
forced to buy cement on the market at higher price than the price those
factories would have supplied.
Moreover, they are claiming for work interrupted and delayed due to a
“Shortage“ from a supplier and not from the market. The project of our
discussion is administered by FIDUC condition of contract. The
Contract provides for the Price adjustment of fuel, bitumen and re-bar
and not cement. Please can I have your view on this matter.
Problem 13 Terrorist Activity
This query concerns security problems doing the project route. There has
been a ‘terrorist‘ attack and abduction some 70 km from the project end
point. The town has experienced a number of bombing incidents. The
contractor is highly concerned about the security problem. To date there
are no actual incidents of any terrorist attack on either the Contractor’s
expatriate staff or the local staff. But he is complaining that he has to
suspend work early in the day for fear of a ‘terrorist attack ‘incident. Is the
contractor’s action warranted in light of the contractual provisions?