๐Construction contracts always encounter disputes and diligent dispute resolution ensures appropriate remedy. The arbitration process though delves more within the terms of the Contract, it should also ensure that the terms do not contravene the provisions of the Indian Contract Act.
Following are the extract of important sections that are frequently referred in Construction Arbitration:
๐Section 37: “The parties to a contract must either perform, or offer to perform, their respective promises unless such performance is dispensed with or excused under the provisions of this Act, or of any other law”.
Sunrise Associates v. Govt. of NCT of Delhi, AIR 2006 SC 1908.
๐Section 55: “When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it as has not been performed, becomes voidable at the option of the promise if the intention of the parties was that time should be of the essence of the contract.”.
๐Section 51: “When a contract consists of reciprocal promises to be simultaneously performed, no promisor need to perform his promise unless the promise is ready and willing to perform his reciprocal promise.”.
๐Section 52: “Where the order in which reciprocal promises are to be performed is expressly fixed by the contract, they shall be performed in that order; and where the order is not expressly fixed by the contract; they shall be performed in that order which the nature of the transaction requires.”.
๐Section 53: “When a contract contains reciprocal promises, and one party to the contract prevents the other from performing his promise, the contract becomes voidable at the option of the party so prevented; and he is entitled to compensation from the other party for any loss which he may sustain in consequence of the non-performance of the contract.”.
๐Section 54: “When a contract consists of reciprocal promises, such that one of them cannot be performed, or that its performance cannot be claimed till the other has been performed, and the promisor of the promise last mentioned fails to perform it, the such promisor cannot claim the performance of the reciprocal promise, and must make compensation to the other party to the contract for any loss which such other party may sustain by the non-performance of the contract”.
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