The Latin principle of caveat emptor literally meaning let the buyer beware, has been followed for many years by the English courts in the context of business transactions. Pre the industrial revolution the action for breach of contractual rights needed a written warranty otherwise action could only be brought on the grounds of fraud. The reasoning for such action was based on the manner in which business was conducted, that is, namely at small fairs where buyers could inspect the goods and haggle accordingly. This is evidenced in cases such as Chandelor v Lopus in which a plaintiff brought an action against the defendant in relation to a Bezoar stone which was thought to have medicinal properties. In this instance, the majority of the
The following short case will give you a good idea of how risks surface in business and project planning and what companies do about it. Consider that you are the Risk Manager as you look at this case, as it will be a good exercise for the time when you will be that Risk Manager!
(Clohesy cite.) In Clohesy, a supermarket shopper was kidnapped and later murdered in the supermarket parking lot. CITE. The court held that defendant was liable to plaintiff because the defendant knew that in the two and half years prior to the kidnapping, criminal activity had been increasing in the neighborhood. The court reasoned that under the totality of circumstances, sound public policy, and fairness, the defendant owed a duty to exercise reasonable care to prevent foreseeable harm because although no one had previously been murdered during a criminal activity, criminal activity of some kind was foreseeable and it was the duty of the business owner to provide some measure of security in the parking lot. Just as in Hopkins, where the broker failed to exercise care by inspecting the property for defects that would have caused injury and foresaw that an invitee may get injured. (CITE HOPKINS). The court held the broker had a duty to warn of any such discoverable physical features or conditions upon inspection of the property that pose a hazard or danger to such visitors. (Hopkins
Buick Is another important product liability case. Prior to this ruling, successful product liability cases required privity of contract, meaning that the plaintiff and defendant must have had a contractual relationship in order for the plaintiff bring a successful suit. This case extended the manufacturer's duty of care to the ultimate consumer of the product, regardless of whether or not they were the actual purchaser from the defendant. Later cases extended the manufacturer's duty of care further, to all persons and property likely to be endangered buy the products probable use, such as the consumers family, guests, and even
This can range from the right timing to take a new job to timing being the difference between life and death for a patient. It is important to have rational thought in your decision-making process but in some cases timing is everything and you must be ready and willing to make a split-second decision because someone’s life depends on that decision. In other cases, it makes sense to take your time and carefully think about your options such as leasing a new building or planning for the next big construction project. Thus, the sooner risks are identified, the sooner plans can be made to mitigate or manage them. Assigning the risk identification process to a contractor or an individual member of the project staff is rarely successful and may be considered a way to achieve the appearance of risk identification without doing it.
In the initiation phase of the project, Anderson and Gable, decided to deliberately present false information to the client in regards to the project specification. Therefore, they both knew the risk that they did not have the capability of satisfying the project specification. However, they decided to go through with giving false information in order to win the tender, armed with the intention of negotiating the specification scope with the client halfway down the project. This approach of managing risk should not be accepted and is not recommended as it shows that the management
• But for the Texas customer’s failure to perform an inspection of Lyle’s installation work prior to or after Lyle left the work site, the injury would not have happened.
However, whether it is difficult or impossible to evaluate the cost of a service or item, contractors will usually agree to a cost-reimbursement contract, in which the stakeholders assume some level of risk for the final costs. (government)
Picking the right contractor could mean the difference between an easy and enjoyable experience and an endless sea of pain and suffering. Regardless of the size of the project, most people would narrow down the requirements of a good contractor to three general categories: cost, quality, ability to meet agreed upon time-frames. For businesses, the only additional requirement is communication. As it pains me to say, John Doe Construction failed to meet the basic expectations above, it also managed to cost us significant amount of money due to delays. The names of the guilty have been changed to protect the innocent.
Clough, Richard H, Glenn A. Sears, S K. Sears, Robert O. Segner, and Jerald L. Rounds. Construction Contracting: A Practical Guide to Company Management. , 2015. Print.
First, the ethical dilemma itself will be outlined. In the construction industry, it is often necessary for an owner or a construction company to enlist the help of other smaller or more specialized companies in the completion of a project. This practice is known as contracting. When an owner or company, referred to as the contractor, wants to contract out for a job, they will list the job and interested companies will bid for the contract. When arriving at a bid amount, interested companies will estimate
Within a project, the project’s success and budget belong to and are the responsibility of the customer. The Customer should have the final say in regards to what is acceptable and unacceptable in regards to risk and the quantification of risk. It is however, the contractor’s responsibility to be the primary source of expertise on a project or what they are being contracted to do. The contractor should offer their opinion and recommendations, and the customer should take their contractors opinions and recommendations seriously due to their expertise in the area. Overall, collaboration between the customer and the contractor should be the ultimate way to resolve a matter of dispute. Members from both the customer and contractor side should meet discuss historical events, modeling and simulation to arrive at the appropriate answer. Also, with quantifying risk, the customer and the contractor should be able to go back and look at the data. With risk quantification, there should be very little room for opinion and judgment which should make it easy to base a decision or a resolution based on hard core data. If a solution or an answer is not able to be decided upon, a third party consultation
This assignment is included in the 2014 session of the Risk Management module of the MSc in Project Management course at University of Aberdeen. The main purpose of the assignment is to demonstrate my understanding of the issues involved in Risk Management and how they are applied in my current Project environment. The assignment is split in to two questions as detailed below.
The research takes a case study approach. The case study analysis dwelt on risk management by Contractors who work on energy and utility construction projects, including strategies and supporting structures for managing risks, complete with an analysis of how these strategies and structures are implemented and supported by the Contractors resources base. The researcher specifically chose utility contractors for this study as the Energy and Utilities sector play an indispensable role in the global economy and in the UK, industry employs around 2% of the UK workforce (AGCAS, 2012). Moreover, the UK government identified the Utilities companies as companies that are heavily involved in risky incidents affecting their sector thus playing a crucial role in the preparation and planning for emergencies responsibilities (UK Government, 2013). According to Yip (2003) construction is risky as it almost always certainly involves loss of time and money. Above all, any denial of service during outage result in impact on communities (Lindman, 2008) and utility services are no exception. Against this background, it could be argued that contractors working on construction projects undoubtedly play a significant role in managing risks in order to stay in business.
For this assignment the writer is going to discuss the nature and types of construction contracts and will explain the legal responsibilities of the various parties involved in the design and the construction process.