Measure National Assembly No. 6 / 1957 Coll.
Legal measure on economic construction contracts
Valid
Effective from 01.03.1957
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6
Legal action by the Bureau
National Assembly
of 14 February 1957
on economic construction contracts.
The Bureau of the National Assembly of the Czechoslovak Republic has decided on the following legal measure under Article 66 of the Constitution:
Preliminary provisions
This legal measure provides for the contractual security of construction and assembly work carried out in a supplier's way on construction whose investors are the organisation of the socialist sector, with the exception of uniform agricultural cooperatives.
(1) The provisions of this statutory measure apply to the buildings included in the State investment plan.
(2) For constructions not included in the State Investment Construction Plan, for overhauls and other works or performances relating to investment construction, the provisions of this statutory measure shall apply mutatis mutandis.
Economic construction contracts
(1) In accordance with the national economic development plan, the investor concludes general contracts and annual contracts on the basis of an approved initial project and its budget; in the case of one-stage documentation, conclude such contracts on the basis of that documentation.
(2) The General Agreement is concluded for the entire volume of work to be carried out in different consecutive calendar years.
(3) The annual contract is concluded on the volumes of work to be carried out in the same calendar year. Only an annual contract is concluded on the construction to be started and completed in the same calendar year.
(4) The annual contract shall be concluded on the volumes of works indicated for the construction in the approved investment plan and shall be specified, as appropriate, in the addendum to the contract when submitting a project with a budget determining the sales price. The addendum to the contract shall specify the prices at budget rates determining the sales price and, if necessary, the exact volume of works.
(5) Preparatory work (e.g. demolition of buildings, felling of forests, landscaping, setting up of incoming roads, water pipelines, electrical connections) may be carried out pending the conclusion of an annual contract under the special contract on preparatory work under the conditions prescribed for financing and control of buildings.
(6) The main arbitrator of the Czechoslovak Republic may issue provisions adjusting the terms of the contracts by way of derogation from § § 5 and 6, after which it provides for other forms of economic construction contracts.
(1) An investor subcontracts construction and assembly works on one construction site either to one general contractor of construction and assembly works or to all construction works to one contractor of construction works and all assembly works to the supplier of assembly works.
(2) The general contractor may use subcontractors to carry out individual work. However, it is obliged to provide, manage, coordinate and supply the investor with all the work he has commissioned and is responsible for it, whether it has done it itself or through subcontractors. If the investor has not commissioned all the construction and assembly works to the general contractor of construction and assembly works, the investor shall carry out his own reinsurance and coordination tasks, unless the parties agree otherwise.
(1) The General Treaty contains:
(a) the names of the parties and their superior bodies;
(b) banking connections between both parties;
(c) a description of the construction and, if it is divided into whole parts, a description of those parts;
(d) the start and completion periods of the construction (s) and, if it is divided into integrated parts, the start and completion periods of those parts;
(e) the total volume of construction works, after assembly work according to the budget documentation and the distribution of that volume per year of construction;
(f) deadlines for the submission of implementing projects (in the case of three-stage documentation of the technical project) by object or part thereof with a budget determining the sales price;
(g) arrangements on which investor facilities, services or property items will be used by the supplier, for how long, under which conditions and under which remuneration;
(h) property penalties;
(i) following other arrangements.
(2) The general contract shall include:
(a) the approved initial project and the budget for it;
(b) an overview of the indicative deadlines for the submission of technology equipment if the investor is to submit them for assembly.
(1) The annual contract shall include:
(a) the names of the parties, their superior bodies and the working addresses of the persons authorised to act on behalf of the party;
(b) banking connections between both parties;
(c) a reference to the general contract;
(d) annual material volumes of works and their prices;
(e) the periods within which the supplier is to carry out the material volumes of work necessary for the installation of the technological equipment during the year, after the supply or work carried out by the investor and the periods within which the supplier is to carry out the material volumes of other similarly important works;
(f) in the case of three-stage documentation, the deadline for the submission of implementing projects;
(g) reference to technical standards, conditions, specifications and similar documents;
(h) the time limits within which the investor submits to the contractor the construction site or other areas necessary for the construction work or its integrated parts, funds, materials, technological equipment and the like;
(i) property penalties;
(j) other arrangements not covered by the General Agreement.
(2) The annual construction contract, to be started and completed in the same calendar year, contains, with the exception of the reference to the general contract, the elements referred to in paragraph 1 and, in addition, the elements referred to in § 5 (1) (c), (d) (f), (g) and the total volume of the works, after the assembly work according to the budget documents.
(3) The annual contract shall include:
(a) an approved initial project and an implementing project (after an approved technical project) with a budget;
(b) an extract from the investment work and supply plan for the current year.
The reservation of random or other unforeseen circumstances in the contract shall be void.
(1) The Treaties are concluded, amended and repealed in writing. Written forms (usually in the journal) are also needed for other legal acts of the parties.
(2) The files, contracts and supporting documents on which the calculation of time limits depends shall be sent by registered letter or submitted to the written confirmation of the beneficiary.
(1) In the event of changes to the plan, changes to the organisation or to the tasks of the Party or to the tasks of the Party, the authorities implementing the amendment shall be required, at the same time as the amendment, to take the necessary measures to ensure that the economic contracts are fulfilled, amended or cancelled or new contracts are concluded. If the supplier (investor) changes as a result of the measures taken by the superior body, the new supplier (investor) shall assume all the terms of the original contract.
(2) If the plan has been amended, the parties are obliged to make appropriate adjustments to the contracts (to make amendments to them) or cancel the contracts as soon as they have become aware of the change. The provisions on the conclusion of contracts apply mutatis mutandis to their practice (§ 34 (1)).
Supplies, works and performance of parties
(1) The supplier is obliged to procure the material needed to carry out the construction, except for the materials supplied by the investor under the relevant regulations or contract.
(2) If an investor submits technological equipment for installation, it shall submit them to the complete and capable of carrying out the appropriate stage of installation by means of a protocol in the places specified in the construction organisation preparation and within the time limits laid down by the contract. The supplier shall be responsible for the technology equipment taken over as a custodian.
(3) The contract may stipulate that the supplier supplies the construction including the assembled technological equipment. In such a case, the investor shall be obliged to reimburse the supplier for all expenditure at the level laid down in the relevant rules.
(1) The supplier may use the buildings which he builds for the purpose of carrying out the work until he is obliged to surrender the construction or its complete part to the investor free of charge; they must, however, hand them over to the investor within the time limits laid down by the contract, in good condition and free.
(2) Where an investor has his own tugs, his own supply of water, steam, electricity or other ancillary equipment, he is obliged to allow the supplier to use them at prices not exceeding budget prices. Where the extent of use of such equipment and its maintenance by the supplier is not specified in the project and budget documentation, the Parties shall determine it by agreement.
(1) All supplies, works and performance of the supplier and investor, the method of settlement and their payment must be specified in the contract or in the addendum to the contract; settlement and remuneration shall be made through the Bank.
(2) Specific rules apply to financing and invoicing.
Implementation of work
(1) The contracted work is required by the supplier to carry out professional and quality material. Quality material means the type and quality of material prescribed by the project and does not prescribe the project, type and quality corresponding to the relevant standards or contract.
(2) If the supplier finds in the project or budget documentation - after carrying out the work - errors, omissions or other deficiencies, he shall be obliged to notify the investor within 3 days; at the same time he may propose a solution. The investor shall give the supplier the necessary instructions within 5 days of receiving the notification. If the supplier has not received the necessary instructions, he shall be entitled to stop the work directly related to errors, omissions or other deficiencies.
(3) If the necessary derogations change the principles of the solution adopted or imply an increase in the approved budget, the investor shall be obliged to arrange for a change of documentation, apply for its approval in accordance with the relevant rules and, if necessary, to take care of the change of plan. The parties are required to adapt the contract according to the amended documentation.
(4) Derogations which do not alter the principles of the adopted solution and do not imply an increase in the approved budget are approved by the investor and the supplier shall indicate those derogations in the implementation projects. If the supplier has proposed a solution and has not received the necessary instructions from the investor within 5 days (paragraph 2), the proposed solution shall be deemed to have been approved.
(1) If the supplier finds that he can carry out the work more efficiently without prejudice to the quality of the construction carried out, he shall notify the investor and at the same time propose a solution.
(2) If the supplier on his own initiative, with the agreement of the investor and the general designer, has implemented a rationalisation measure which reduces the cost of construction against the budget without reducing the durability or operational quality of the construction, he invokes new prices of works plus half the difference between these prices and the original budget prices.
Verification, surrender and takeover
An investor shall carry out technical supervision in accordance with the relevant rules.
(1) In order to examine works and structures later inaccessible or covered in the next working process, the supplier is obliged to invite the investor no later than 3 days before covering up and write a review note with it. Defects that the investor has reasonably identified must be removed by the supplier before covering up and re-invited the investor to review.
(2) If the investor's representative fails to appear, the supplier shall write the minutes himself and deliver a copy to the investor. The additional uncovering of works or structures at the investor's request shall be carried out on its cargo.
The surrender and taking over of completed buildings or their integrated parts to which this statutory measure applies shall be governed by the provisions of Government Regulation No. 8 / 1956 Coll., on the surrender and taking over of completed buildings or parts thereof and on the authorisation to put them into permanent operation (use).
Liability for defects
The supplier shall be responsible for the defects of the construction or its integrated part taken over by the investor, which are due to the fact that the work has not been carried out under the contract, in particular according to the project and budget documentation, or in the appropriate quality. Any claim on defects that may have been identified at the time of surrender and take-over may be exercised by an investor only if it has been entered in the record of surrender and take-over. Claims on defects which could not have been identified at the time of surrender and take-over may be exercised only if he has drawn up a defect report in good time (Sections 20 and 22) and stated the claims on defects.
(1) If the defect prevents proper operation (use) of the envisaged contract and project, the investor is obliged to demand its removal. The supplier is obliged to carry out construction and assembly works or deliveries associated with the removal of the defect on his cargo, preferably and within the time limit specified in the defect report.
(2) If the defect does not prevent proper operation (use) and cannot be eliminated retrospectively without disproportionate costs, the investor shall not be obliged to insist on its removal; if the investor does not insist on the removal of the defect, he shall require a reasonable deduction from the price of the construction or a complete part of it. In the absence of a haircut to be set in the surrender and takeover minutes, the amount of the reduction must be set in the defect report (§ 20). Where an investor persists to remedy such a defect, the provisions of paragraph 1 of the second sentence shall apply mutatis mutandis.
(1) If an investor finds defects that could not be detected by surrender and takeover, he shall draw up a report on defects.
(2) Unless otherwise binding on both parties, the investor shall invite at least 3 days in advance the supplier to participate in the establishment of the defect protocol.
(3) The Protocol on defects contains in particular:
(a) the period and place of establishment of the Protocol;
(b) the names and functions of the persons who participated in the drawing up of the Protocol;
(c) the description of the construction (of the building) and, if the construction is divided into whole parts, the identification of the complete part on which defects have been identified;
(d) the date on which the defects were detected and the names of the persons who identified them;
(e) a description of the defects and, where possible, an indication of their technical causes;
(f) measures and time limits for the removal of defects, following a price reduction agreement;
(g) signatures of representatives of the investor, supplier and other persons participating in the establishment of the Protocol.
(4) If there is no agreement on the measure or the time limits for the removal of defects or the amount of price reductions, the defect report shall contain the opinion of both the investor and the supplier. The investor shall submit an application for an arbitration decision no later than 60 days after the signature of the defect report, otherwise his entitlement shall cease.
(1) If the supplier's representative fails to appear on the day specified in the investor's invitation, the investor shall draw up a report on defects involving the expert in the work concerned by the defect. An investor's employee shall not be recruited as an expert. The costs of inviting and participating the expert in drawing up the defect protocol shall be borne by the supplier. The investor is obliged to send a defect report to the supplier within 5 days of the date on which it was compiled.
(2) If the supplier does not agree with the measure or deadline for the removal of the defect or the amount of the price reduction, he shall, within 10 days of the date on which he received the defect report, give the investor a reasoned opinion. If they do not do so within that period, they agree to the content of the defect report. Otherwise, the last sentence of Paragraph 20 (4) applies mutatis mutandis.
(1) If the provisions binding on both parties do not provide otherwise, the investor must draw up a report on the defects identified
for fire-resistant linings of industrial furnaces (e.g. blast furnaces, Martin furnaces) no later than 2 months,
for other furnaces, drying plants, factory chimneys, fire-resistant linings, steam boilers, assembly plants, industrial installations and electrical works, internal water pipelines, internal sewage and smoke pipes no later than 6 months;
for other works not later than 1 year
after signing the surrender and takeover minutes. The protocol shall be drawn up within 10 days of the date of detection of defects.
(2) If a guarantee is given, the defect report shall be drawn up within 10 days of the date of detection of the defect within the guarantee period, but not later than the 10th day following the expiry of the guarantee.
(3) The right of liability for defects shall cease if the Protocol has not been drawn up no later than the 10th day following the expiry of the time limits laid down for the detection of defects.
If the supplier does not remove the defects identified within the agreed time limits, the investor shall be entitled to remove or dispose of the defects on the supplier's cargo. The person who removed the defects is responsible only for the defects of his own work under the contract he entered into with the investor, otherwise the supplier's liability is not affected.
The provisions of Part Six shall apply mutatis mutandis to defects in the corrections made.
Compensation
(1) A Party which, in breach of an undertaking under a construction contract, damages another Party shall be liable if it fails to prove that it has not caused the damage. Any claim made on damage which may have been found at the time of surrender and takeover may be claimed by the Party only if it has been made on the record of surrender and takeover. Damage is only paid if it is not covered by property sanctions. When determining the amount of compensation, account shall be taken of whether the injured party has done whatever is necessary to reduce or avert the damage.
(2) A claim for compensation resulting from a defect is claimed by the investor against the supplier, even if the liability for defects has already ceased. However, in order to compensate for the damage, it is not possible to require the removal of the defect, the cost of the removal or the price reduction.
Property sanctions
(1) If the supplier fails to complete the construction or the complete part of the construction within the contractual period, he shall pay the investor a penalty of 1% of the price of the construction or of the complete part of the construction, and if the delay of more than 30 days is another penalty of 1% of the price. Such periodic penalty payments shall be counted against the amounts paid under paragraph 2.
(2) If the supplier does not carry out the annual volume of work agreed for the calendar year in which the construction is not to be completed, the investor shall pay a penalty of 1 / 2% of the price of the work agreed in the annual contract.
(3) The parties are obliged to negotiate property penalties for failure to comply with the deadlines set out in the annual contract pursuant to Article 6 (1) (e).
(4) If the contractor completes the construction or the complete part of the construction within the agreed time limit, the investor shall return the periodic penalty payment for the construction or its complete part, paid in accordance with paragraph 2; the periodic penalty payment shall not be refunded to the amount of damage suffered by the investor as a result of the delay of the contractor (§ 25 (1)).
(5) If the supplier is late due to circumstances arising from the investor, the period during which the investor was late shall not be added to the contractual period for the completion of the construction or its complete part for the purpose of property sanctions. If a contractor with the completion of a construction or a complete part of it is delayed for a maximum period of time, the investor shall repay the periodic penalty payment previously paid by the supplier pursuant to paragraph 2.
(6) If the supplier does not, within the specified time limits, remove the minor underwriting and defects mentioned in the commit and take-over note or defects mentioned in the defect report, he shall pay the investor for each day of delay until a daily penalty of 2000 CZK has been removed by the supplier or investor (§ 23), but no later than 90 days.
(1) If the investor does not submit to the supplier within the specified or agreed time limits prescribed by the project or budget documentation, the supplier will pay a penalty of 1% of the price of the works agreed in the annual contract and if the delay is longer than 30 days, a further penalty of 1% of that price. Where more than one deadline has been agreed for the submission of the dossier, the periodic penalty payments shall be made only at the first delay.
(2) The parties are required to negotiate property penalties for failure to comply with the deadlines set out in the annual contract pursuant to Article 6 (1) (h).
(1) If the supplier does not notify the investor in writing at the latest 15 days before the completion of the construction and assembly works when the construction or part of the construction is ready for surrender or does not prepare the necessary documentation at the time of the start of the taking-over procedure (Section 5 (4) of the W.v. No. 8 / 1956 Coll.), he shall be obliged to pay the investor a fine of 500 CZK for each day of delay but no later than 30 days.
(2) The same fine shall be paid by the investor to the supplier if he does not initiate the taking-over procedure on the agreed date or does not end within the specified or agreed time limit, does not invite the general designer, the supplier of the main equipment and other bodies whose participation is prescribed by the applicable regulations or otherwise necessary for the proper conduct of the taking-over procedure, does not prepare his evidence of the built-in operation or its integrated part, does not equip the energy, fuel, raw materials and other operating materials necessary for carrying out the comprehensive testing, does not provide measuring and control instruments for monitoring and measuring the operation of the equipment or does not provide the necessary number of qualified personnel to operate the tested equipment.
(3) The fine referred to in paragraphs 1 and 2 shall be paid only once even if more than one obligation has been infringed.
Entitlement to property sanctions, after the full amount of the property sanctions, shall not be granted to a Party which itself has, in whole or in part, made it impossible to fulfil an obligation or other obligation.
The immunity, reduction or netting of property penalties between the Parties shall be void.
The Party shall not waive the obligation to comply with the contract by paying property penalties.
If a Party, whether in respect of the same party or in respect of another Party, is in breach of its obligations, the arbitration authority may increase its property sanctions, taking into account in particular the importance of the work, the nature of the individual obligations and the degree of non-compliance. Only in exceptional cases can an arbitrage authority reduce property sanctions.
Time limits for the exercise of rights
(1) Entitlements under economic construction contracts shall cease if they are not exercised within one and a half years of the date on which the entitlement is acquired. Entitlements for property penalties shall cease if they are not exercised within 6 months of the date on which the entitlement is acquired.
(2) If an agreement has been reached on the removal of defects, the entitlement to the removal shall cease if it is not exercised within 60 days of the expiry of the time limits laid down in the surrender and takeover record or in the malfunctioning report; if the agreement has not been reached, the right to remedy the defects shall cease if it is not exercised within 60 days of the signature of the surrender and takeover registration or the malfunctioning report.
(3) The right to be deducted from the price shall cease if it is not applied within 60 days of the signature of the surrender and takeover registration or of the defect report.
(4) The claim for reimbursement of the costs of the correction of the defect shall cease if it is not applied within 6 months of the date on which the defect was removed.
(5) The claim for compensation shall cease if it is not claimed within one and a half years. This period shall begin:
(a) in the case of the damage referred to in the surrender and take-over record since the signature of that registration,
(b) in the case of damage arising from a defect which may have been detected at the time of surrender and take-over, since the signature of the surrender and take-over registration, in the case of damage arising from other defects since the signature of the defect report, and if the defect report has not been drawn up, by the expiry of the time limits set for the detection of the defect (§ 22);
(c) for other damage from the date on which the amount of the damage may have been detected.
(6) The provisions of paragraphs 2 to 5 also apply, mutatis mutandis, to claims for liability for defects caused by corrections made (§ 24) and to claims for damages arising from such defects.
Entitlement, transitional and final provisions
(1) The provisions implementing this legal measure will be issued by the main arbitration of the Czechoslovak Republic. In particular, these provisions may provide for the necessary derogations for constructions not included in the State Investment Construction Plan, for overhauls and for other works or performances relating to investment construction (Section 2 (2)), for the adjustment of property penalties by way of derogation than provided for in Sections 26 to 29, and for the provision of property penalties for non-compliance with other obligations laid down by this statutory measure or by rules issued on its basis.
(2) The main arbitrator of the Czechoslovak Republic issues in agreement with the participating ministers regulations governing the contractual security of works of subcontractors of construction and assembly works and direct suppliers of construction and assembly works to investors, unless the general contractor of construction and assembly works is. In doing so, it may provide for an adjustment derogating from the provisions of Section 4 and also for sub-supply relations for deliveries and purchases of installations intended for export supplies.
(3) The main arbitrator of the Czechoslovak Republic shall, in agreement with the State Office of Planning, the State Committee for Construction, the Ministry of Finance and other participating ministries, issue regulations on the procedure and costs associated with the elimination of damage caused by random or other unforeseen circumstances on the buildings before their surrender and takeover.
(4) The relevant supply ministries, in agreement with the customer ministries, shall issue basic terms of supply, adjusting the details to joint suppliers and investors within the limits of the provisions of this statutory measure and the implementing provisions.
(1) All provisions contrary to this legal measure shall be repealed; in particular, the Decree of the State Office of Planning No 95 / 1953 Ú. l, on economic supply contracts, is repealed. For contracts under this legal measure, the provisions of § 43 of Decree No. 33 / 1955 Coll., on Economic Contracts, cease to apply.
(2) If the existing provisions provide for longer periods for the termination of the claims referred to in paragraphs 2 to 4 of Article 33, the rights for which those periods have started to run before the application of this legal measure, their expiry and, at the latest, the expiry of the time limits laid down in paragraphs 2 to 4 of Article 33, calculated from the date of application of this legal measure.
This legal measure shall take effect on 1 March 1957; All members of the government will do it.
Zaporocký v. r.
Fierlinger v. r.
Broad v. r.
Dolan v. r.
Kopecký v. r.
Ing. Jankovcová v. r.
Polack v. r.
Bark v. r.
Ing. Shimonek v. r.
Dr Kylý v. r.
Plojhar v. r.
Dr. Nove v. r.
Bakuľa v. r.
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Regulation Information
| Citation | Measures of the National Assembly No. 6 / 1957 Coll., on Economic Construction Contracts |
|---|---|
| Regulation Type | - |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 11.03.1957 |
|---|---|
| Effective from | 01.03.1957 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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