16 BUSINESS AND TRAINING
b .
c .
The parties must continue to perform their obligations notwithstanding any disagreement or dispute that may exist between them . The JBCC SfS refers to “ the employer consents to the joining of any subcontractor with the PCr as a party to any proceedings .”
Note : There is no privity of contract between the employer and a nominated / selected subcontractor .
Note : The Department of Justice in South Africa issued a directive on 03 May 2013 where the employer is an organ of state that dispute resolution procedures in a SfC | SfS must be used in preference to litigation , allowing for a settlement by : i . Mediation – quick and inexpensive ; ii . Adjudication ( provided for in the draft CIDB ' s “ prompt payment ” best practice guidelines , yet to be published ) to resolve payment and other technical issues speedily ; iii . Arbitration – as a determination is ' final ' without going to litigation ;
Note : Litigation is a complex , time-consuming , expensive option with no ‘ win in court ’ guarantee – a last resort ! Consider that a . The building industry to a greater extent , and the civil engineering contracting firms to a lesser extent , rely on Subcontractors who b .
c . provide specialised construction skills – sometimes involving sophisticated product-specific construction equipment . The industry generally has a poor track record of looking after subcontractors : i . Not using SfS to appoint ‘ domestic ’, ‘ nominated ’ or
‘ selected ’ subcontractors ; ii . Issuing a letter of appointment with unilateral clauses in the contractor ’ s favour ; iii . Unfair clauses include the introduction of ‘ pay when paid ’ terms ; iv . A guarantee for payment is rarely provided ; v . Performance guarantees are generally required – often retention is deducted – and the balance of such amounts at the final account stage is not repaid . Subcontractors , for fear of losing work , accept such unfair employment conditions and are not offered an original unaltered SfS to sign ( and given a reference copy ) and don ’ t form a united front on behalf of their industry . Application in SfC i . Insist that each subcontractor is appointed before subcontract-works commence using an unaltered recognised SfS . ii . Understand your obligations and responsibilities described in the tender documents . iii . Create and maintain a comprehensive record of all communications . PA