Egypt: Scope Of Work Under Contractual Provisions And Standards Of Construction Work

It is established that that contract, as defined by the Law, in terms of binding to its parties, is the law of the contracting parties, as long as it does not conflict in any of its clauses with the jus cogens. However, sometimes compliance with work customs may also be obligatory, even if it is not stipulated by peremptory legal provisions. Accordingly, customary rules in work shall be taken into account during the implementation of the contract. Adherence to contract provisions may not lead to exclusion and neglect of customs related to workmanship. For example, we can refer to judicial activity sometimes, as legislation is not the only legal source, and, therefore, the judge or the arbitral tribunal may refer to legal custom to fill the gap in the absence of legislative treatment of some or all of the circumstances of the issue in question. This in addition to the need to verify that the terms of the contract do not breach or neglect customary issues applicable to such types of contracts. To explain this issue, the following points are covered:

I. Concept of “Customary" Rules

“Custom" is a set of unwritten rules followed by individuals in their behavior for successive generations, until they believe that such rules have become binding and that the violator will be subjected to the punishment. Custom is the second source of official law and is a backup source for legislation in the absence of an applicable legal rule. Therefore, the judge only refers to it in the absence of a legislative provision, or in the event of a provision that refers to custom, explicitly or implicitly. Accordingly, a lawyer cannot use it in the presence of a legislative provision governing the matter.

This was decided by Article (1), Para. 2, of the Egyptian Civil Law, which stipulates as follows:

It should be noted that the customary legal rule has two pillars, which are to determine whether the conduct is customary or not, and, therefore, whether or not they can be relied upon.

In all cases, to differentiate the custom to be followed, there are two basic pillars, as follows:

A) Material Pillar:

It is the habit of adhering to a certain unwritten rule, which is achieved by meeting three requirements:

A) recurrence and repetition, B) generality and stability, C) Not to breach public order, and following a behavior consistently and continuously with no violation of public order, expressing the set of basic principles in social organization, or a set of bases that make up the general social belief.

B) Moral Pillar:

It represents a sense of obligation, not just getting used to obligation, but also believing in obligation. The customary rule derives an obligation from the terminology and agreement of the group on that binding force, including organizational methods for transactions in various fields, including contracting and construction.

2. Scope of Obligation to the Contract Terms:

No problem arises when the terms of the contract are not in conflict with the customs of work or standards of workmanship. This shall be fully followed in accordance with such terms and shall be considered enforceable as agreed upon by the contracting parties. The contract, in this case, is the only law of the contracting parties that governs the agreement between them. If these terms comply with the law and any customary rule regarding the work or method of implementation, the force binding on the parties to the contract is complete and is not limited. For example, about determining wages, contract term, working hours, quantities and types of materials used in the completion of the works or the place of implementation, the obligation is the full compliance with the contract terms as drafted and agreed upon by the parties. However, in all cases, it is permissible to amend or mitigate the obligations of any party by amending the terms of the contract, provided that such amendment shall be agreed by the parties.

3. Requirements for Customary Rules in Construction Works:

To clarify this point, we recall, for example, Article (649) of the Law, which stipulates that:

“(1) If the employer supplied the materials, the contractor shall guard them and use them with the requisite technical skill, and provide the employer with an account showing what he used of them, and return the rest to it. If any of the materials become unfit for use due to the contractor's negligence or inadequate technical skill, it must reimburse the employer for the value of such materials.

(2) In the absence of an agreement or trade usage to the contrary, the contractor shall provide, at his own expense, the tools and additional equipment he needs for the performance of the work.”

It is necessary to use a material to complete the work in most construction contracts, especially in the field of construction. Therefore, that material is either supplied by the contractor or the employer. In the latter case, the contractor's work is limited to its workmanship, i.e., as is customary in the construction field: "Supply and Implementation” " or “Implementation" only.

If the contractor supplies the material of the work, it shall provide a warranty for it. However, the Law did not explicitly specify the warranty period for construction works. Traditionally, the warranty period is one calendar year for civil works and two or three calendar years for electromechanical works, from the date of work receipt by the employer. Hence, if the warranty period is not specified or a different warranty period is set, the referred custom shall prevail, regardless of the provision in this regard in the construction contract.

4. Effect of Custom on Construction Contracts

Custom in contracts may be termed “Contractual Custom”, which is the customs incorporated by people in contracts, that such contracts became–in their view–a binding obligation and cannot be violated. This may arise in the process of contract interpretation, and determining the obligations of each of the parties to the contract.

The custom, n this sense refers to such traditions considered as a common practice in executing contracts, that such contracts became–in their view–a binding obligation and cannot be violated. Accordingly, there is a difference between the construction contracts and any contract. Such contracts are all the same, governed by customs regarding this type of agreement, so that experience is required in the event of any dispute between the parties on the implementation of contracts and the extent to which the terms of such contracts shall be followed and adhered to, in some positions, or the need to refer to the customary meaning of such terms. competent court or the tribunal may seek the opinions of experts to demonstrate the intended meaning of the text of the terms under the customs and standards of workmanship.

However, the operation of the effects of contractual custom may result in a violation of some of the terms of the contract, or a complete change in their meaning, which may reflect the implicit cancellation of some or all of the provisions of the text in its apparent sense that contradicts the customs in the construction field.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.