In exceptional circumstances and in cases of force majeure, the following procedures must be followed in accordance with the general conditions for building contracts YSE 1998:
notify immediately of force majeure and/or the threat thereof
identify the effects of force majeure on contract period and costs
set out the requirements for extending the contract period and reimbursing costs
obligation to minimise damages
In the general conditions for building contracts YSE 1998, the above procedural rules extend to a situation where force majeure only threatens to delay the execution of the contract. The contractor shall immediately notify the client if a force majeure threatens to delay the work on site. The contractor must also notify if the work is suspended or there is a reason that, in the opinion of the contractor, justifies an extension of the contract period in accordance with section 20 of the YSE 1998 or compensation for costs in accordance with section 50 of the YSE 1998.
In construction contracts, the contractor shall identify the actual impact of disruption caused by coronavirus and virus control measures on the schedule and costs of the building contract in question as soon as the effects of force majeure on the site schedule can be more accurately established.
The contractor shall make an individualised proposal of their financial requirements in accordance with section 50 of the YSE 1998 and their schedule requirements in accordance with section 23 of the YSE 1998. The basis for the requirements must be recorded weekly or, if necessary, even daily, together with the client’s representative, stating what challenges to the operation of the site have been caused by the factor causing the disruption. All additional costs must be identified in accordance with sections 23 and 50 of the YSE 1998.
However, the additional costs must be directly related to the force majeure and must be agreed in advance between the contracting parties before the costs are incurred. Acceptable additional costs may include, for example, the use of alternative materials due to challenges in material availability or additional costs associated with higher labour costs. Additional billable costs do not, however, include costs directly related to the contractor’s employer obligations, such as costs related to site hygiene and site organisation (e.g., face masks, hand sanitiser).
On the other hand, the contractor must seek to limit the damage and find out whether some work can be carried out despite the disruption, for example, though alternative arrangements. The contractor must identify to the client what steps it has taken to minimise the inconvenience and make the necessary entries in the site log.
It is important for the contractor to ensure that the individualised proposal of the requirements is submitted in a timely manner so that there are no more surprises during the acceptance phase or the final financial statement. If either party wishes to validly establish a fact relating to the execution of the work or the circumstances, a review of the execution of the work may also be carried out in accordance with section 65 of the YSE 1998. Uncontested compensation pursuant to section 50 of the YSE 1998 shall be paid as separately agreed with the contractor.