Latest cases of temporary suspension of construction contracts

Article overview

Temporarily suspending the implementation of construction contracts is an important decision that needs to be made carefully and in full compliance with legal regulations. A clear understanding of the circumstances that may lead to suspension, along with accurate responsibilities and notification procedures, will help parties protect their rights and limit arising risks. In the following article, let’s join Long Phan to learn more about cases of temporary suspension of construction contracts.

Cases of temporary suspension of construction contracts
Cases of temporary suspension of construction contracts

Latest cases of temporary suspension of construction contracts

According to the provisions of Clause 2, Article 40 of Decree 37/2015/ND-CP, there are some cases of temporary suspension of construction contracts to protect the interests of both parties. Here are the main cases:

  • The contractor suspends the contract when the contractor violates: If the contractor does not meet the requirements for quality, labor safety or progress, the contractor has the right to suspend the contract to ensure the project is carried out in accordance with standards.
  • The contractor suspends when the contractor violates the payment agreement: If the investor does not pay on time (within 28 days), the contractor has the right to suspend the contract to protect its resources.
  • Other violations by the contractor: If the investor does not provide adequate construction conditions, such as not handing over the site on time, the contractor can suspend the contract.

Regulations on contract suspension cases help parties control their interests and prevent greater losses to the project, while also creating an opportunity to resolve disputes peacefully before continuing construction.

When temporarily suspending the performance of a construction contract, is it necessary to notify the other party?

Suspension of construction contracts must comply with the process to ensure legality and avoid disputes. According to Clause 4, Article 145 of the Law on Construction 2014, amended and supplemented in 2020, when temporarily suspending contract performance, the suspending party must notify in writing in advance, clearly stating the reason and duration of the suspension.

  • Notification purpose: Helps both sides prepare for further measures, avoiding unexpected situations. If not notified, the suspending party may violate the contract and be responsible for compensation.
  • Notice period: According to Decree 37/2015/ND-CP, the notice must be sent at least 28 days before the suspension to create time for negotiation and remedy of violations.
  • Notification content: Must be clear, including reason for suspension, time and resolution steps. Lack of specific information can lead to disputes and affect project progress.

If the notification process is not properly followed and causes damage, the suspending party will have to compensate according to the provisions of the law.

When temporarily suspending the performance of a construction contract, is it necessary to notify the other party?
When temporarily suspending the performance of a construction contract, is it necessary to notify the other party?

Responsibility when temporarily suspending construction contracts incorrectly

Suspension of a construction contract that does not comply with regulations can cause serious legal and financial consequences for the violating party. According to Article 43 of Decree 37/2015/ND-CP and Article 146 of the Law on Construction 2014, amended and supplemented in 2020, the responsibilities of the parties are clearly stipulated, including compensation for damages and other remedies.

  1. Responsibilities of the Contractor
  • If the contractor suspends the contract without a reasonable reason or without prior notice, the contractor has the right to request compensation for damages.
  • Damages may include labor costs, materials costs, and expenses incurred due to project shutdown.
  1. Responsibilities of the Contractor
  • If the contractor arbitrarily suspends without a valid reason or without prior notice, they are also responsible.
  • The contractor has the right to request compensation for damages or terminate the contract if the violation is serious. This can affect the progress and reputation of the project.
  1. Payment Violations
  • If the investor does not pay on time, the contractor has the right to suspend construction and request compensation for damages.
  • Overdue interest will be calculated from the first day of late payment until the amount is paid in full.
Responsibility when temporarily suspending construction contracts incorrectly
Responsibility when temporarily suspending construction contracts incorrectly

Detailed consulting services in cases of temporary suspension of construction contracts in Long Phan

Long Phan provides in-depth legal consulting services in cases of temporary suspension of construction contracts. We help customers understand their rights and obligations in these situations, and assist in providing appropriate solutions to protect legal interests.

Long Phan’s consulting services include:

  • Consulting on valid cases of contract suspension.
  • Support drafting suspension notices.
  • Clearly identify the reason for suspending the contract, which could be due to contract violation, force majeure, or a need for remediation.
  • Consulting and supporting customers to organize meetings to discuss and negotiate issues arising from the suspension.
  • Representing customers in negotiations.
  • Consulting on methods to resolve disputes arising from contract suspension.

Temporarily suspending the performance of construction contracts requires compliance with legal procedures and must be done carefully to avoid causing damage to the parties and possible disputes. At Long Phan, we support you to ensure that all processes are carried out legally and effectively, helping to minimize risks and avoid damage. If you need detailed advice, please contact us via the hotline: 0906735386.