What Happens When It All Goes Wrong? Terminating A Construction Contract From A UAE Law Perspective

Termination is a drastic step and it is an option which should never be taken lightly – Indeed, regardless of how clearly a termination clause has been drafted and how directly a particular event is covered by a contractual ground for termination, termination is seldom a seamless process without difficulty.

If the Employer is the terminating party, there will almost inevitably be a delay in engaging a replacement contractor while the difficult question of addressing the interface between the works performed by the terminated contractor and the replacement contractor needs to be dealt with.

Alternatively, any termination by the Contractor is likely to emanate from the nonpayment of sums due to the Contractor. Even if the Employer has the means to pay, there will almost inevitably be a reason for non-payment.