Construction law

EIABC
Construction Technology and Management
COTM 4502 – Construction Law
Sub to -Ins. Dr. WUBSHIT JEKAL (Ass. Prof)
Group -ABEL BEKELE----------------------------TCR/0933/99

-BINIYAM REGASSA---------------------TCR/1000/99

-MULUKAN ALEBACHAW-------------TCR/1233/99

- SISAY ALEMU----------------------------TCR/1291/99

-SELOMON TESFAYE--------------------TCR/1296/99

-SAMUEL TECHALU---------------------TCR/1269/99

-YEKENALEM F/SELASSIE------------TCR/1335/99

-YOSEF TAMARU-------------------------TCR/1354/99

-YOHANES HAILU------------------------TCR/1343/99

-YORDANOS KALAB---------------------TCR/1352/99

Date: July 6, 2010

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Introduction
As asked by our instructor we have made a very detail analysis of the

Civil Code
BOOK IV OBLIGATIONS

TITLE XIII EXTRA-CONTRACTUAL LIABILITY AND UNLAWFUL

ENRICHMENT

TITLE XIV AGENCY

And we have selected those which are relevant for the construction
industry. From these selected articles we have discussed on each article,
this step was steered by the acting facilitator, then after coming into
consciences within the group we wrought down a detail explanation on
each articles as agreed by the group. Both the acting facilitator and
reporter (not to forget that we have been taking these positions
interchangeably) have accomplished a great task in organizing the group,
fixing meeting times, facilitating communication and converting the
group idea into a written form. When important we have explained the
articles supporting them with a case.

This group assignment was very helpful in understanding the laws that
are related with the construction industry in particular and also the civil
code in general. The efficiency of the group was very much improved
because of using the idea of division of responsibility and the
introduction of the facilitator and reporter positions in the group, tanks
to our instructor. All in all we are grateful for doing the assignment and
we tank our instructor for giving as such kind of challenging group
work.

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 Selected construction related laws, with their

review and relevance in simple and short words

TITLE XIII

EXTRA-CONTRACTUAL LIABILITY AND UNLAWFUL ENRICHMENT

Chapter1. Extra-Contractual liability

Irrespective of any undertaking on his part, a person shall be liable for

the damage he causes to another by an offence.
(2) A person shall be liable, where the law so provides, for the damage
he causes to another by an activity in which he engages or by an object
he processes.
(3) A person shall be liable where a third party for whom he is
answerable in law incurs a liability arising out of an offence or resulting
from the law.

Review- a person is liable for any offence he made and the damage he
cause in the other party.

Relevance – this helps to develop harmony and peace in the

construction industry by forcing the parties from causing damage on the
other parties and each other.

Liability arising from an Offence

Art. 2028. - General principle.

Whosoever causes damage to another by an offence shall make it good.

Review- any person is accountable for the damage he cause on another

person

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Relevance - this also works for peace and harmony in the construction
industry

Art. 2029. - Types of offence.

(1) An offence may consist in an intentional act or in mere negligence.
(2) An offence may consist in an act or failure to act.

Review- offence is not only by acting out of the law but also by a
condition because of not acting

Relevance – this article is useful for the industry by making persons to

care for the act they make because every act they made has a
consequence, he has to make sure that the consequence is positive

Art. 2031. - Professional fault.

(1) A person practicing a profession or a specific activity shall, in the
practice of such profession or activity, observe the rules governing that
practice.
(2) He shall be liable where, due regard being had to scientific fact or the
accepted rules of the practice of his profession; he is guilty of
imprudence or of negligence constituting definite ignorance of his
duties.

Review- a professional person is accountable to the damage he causes

due to his negligence

Relevance – this article preserves quality in the construction industry by

making the persons in the industry to be careful for their work

Art. 2034. - Purpose of rights.

Subject to the provisions of the preceding Articles, the manner in which
a right is used may not be challenged on the ground that it is contrary to
the economic or social purpose of that right.

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Review- the right given has to comply with the economic and social
purpose

Relevance – this helps the construction industry by maintaining social

and economic purpose

Art. 2035. - Infringement of a law.

(1) A person commits an offence where he infringes any specific and
explicit provision of a law, decree or administrative regulation.

(2) Ignorance of the law is no excuse.

Review- not knowing the law doesn’t clear a person from the penalty

Relevance - this earges the stakeholders in the construction industry to

develop their knowledge about laws that are relevant to them

Art. 2037. - Non-performance of a contract.

(1) A person shall not commit an offence involving his extra-contractual
liability where he fails to discharge his obligations under its contract.
(2) The provisions regarding the non-performance of contracts shall
apply in such case.

Review- a person shall not commit an offence by using the provisions of

extra contractual liability

Relevance – These forces parties to be bound by the contract and work

for its successful completion according to the condition stated in it

Art. 2040. - Interference with the liberty of another.

(1) A person commits an offence where, without due legal authority, he

interferes with the liberty of another person, even for a short time, and
prevents him from moving about as he is entitled to do.
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(2) In such a case, an offence shall be deemed to have been (committed

notwithstanding that no injury is done to the plaintiff's person.
(3) It shall be sufficient for the plaintiff to have been compelled to
behave in a certain manner by the threat of a danger of which he could
not be unaware.

Review- every person has to respect the liberty of another person

Relevance - this develops the feeling of respect to each other in the

industry and avoid any unnecessary disagreement arise for the loss of
respect

Art. 2041. - Lawful authority.

No offence shall be deemed to have been committed where the
(constraint has been imposed in a reasonable manner on a person in the
legal custody of the defendant and for the purpose of enforcing the
authority conferred upon the latter by law.

Review- it will not be considered an offence if a person acts to defend

him and to enforce his lawful authority legally

Relevance - this helps the industry stakeholders to act without fear and
gives them confidence if they act legally, and helps them to differentiate
between legal offence and illegal offence

Art. 2042. – Criminal offence.

(1) No offence shall be deemed to have been committed where the
person who has interfering with the liberty of another had good reason to
believe that the latter had committed a criminal offence.

Review- it will not be an offence to interfere with the liberty of another

person if you believe that the person commits a criminal offence

Relevance – this gives the legal ground for the industry stakeholders to
be a watch dog for criminal acts
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Art. 2046. - 3 Matters of public interest.

(1) A person shall not be deemed to have committed an offence where he
confined himself to expressing his opinion on matters of public interest,
notwithstanding that such opinion inflicts injury on another by bringing
him under public obloquy.
Review- a person shall not be considered as he commit an office if the
offence he made is form his work to keep public interest

Relevance – the construction industry is an industry which cares for the

interest of the public and works towards keeping this public interest, so
this article helps the work towards this interest

Art. 2054. - Assault on property.

A person commits an offence where, without due legal authority, he
takes possession of property against the clearly expressed will of the
lawful owner or possessor of the property.

Review- it will be considered as an offence if a person takes unlawful

possession of another person’s property

Relevance - this will help to protect the industry disputes arise from
unlawful possession of another person’s property

Art. 2056. Disregard of contractual liability.

(1) Whosoever is aware of the existence of a contract between two other
persons commits an offence where he enters into a contract with one of
those persons thereby rendering impossible the performance of the first
contract.
(2) He shall not be liable where the party complaining of the breach of
the first contract has failed to take the necessary measures which would
have ensured the effective performance of that contract.

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Review- any person shall not enter in to a contract with another person
which is already in another contract if the new contract avoids the
performance of the first contract.

Relevance – this forces the industry stakeholders to refrain from making

a contract on a contract and forces them to bind by the existing contract
and to work for the successful completion of the contract.

Art. 2057. - Unfair competition.

A person commits an offence where, through false publications, or by
other means contrary to good faith, he compromises the reputation of a
product or the credit of a commercial establishment.

Review- a person considers to be commit an offence if he involves in the

fabrication of false history on the other person in order to gain
something of not

Relevance – since the industry is known for the condition of

competition this article makes the competition fair by refraining from
this acts which will make the competition unfair.

Art. 2113. - Physical injuries or death.

Fair compensation may be awarded by Way of redress to the victim of
bodily injuries or, in the event of his death in consequence thereof to his
family.

Review- fair compensation will be awarded for a person who is out from
injury and will be given to his family if he is dead

Relevance – this article is useful for the industry by making the persons
in the industry to work as much as possible with care and not to worry if
the injury happens, this will insure the life and physical body of the
persons working on the industry

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Chapter 2 Unlawful Enrichment

Art. 2162. - General principle.

Whosoever has derived a gain from the work or property of another
Without just cause shall indemnify the person at whose expense he has
enriched himself to the extent to which he has benefited from his work
Or property.

Review - Using others property, without a legal agreement, so as to

benefit himself and to generate revenue is unlawful. There for the
person how is unlawfully enriched should repay or compensate the
other party

Relevance- this helps the construction industry by avoiding the conflict

arise form the case of unlawful enrichment

Art. 2164. - Undue payment.

(1) Whosoever has paid what he was not required to pay may recover
it.

Relevance-For example if the client has paid the contractor more than
the money specified in the contract by mistake, the
contractor has to repay the money back to the client.

(2) He may demand restriction of the fruits of the property, or legal

interest, from the date on which the payment was made, where the
person to whom the payment was made acted in bad faith.

Relevance-For example as I have mentioned on the first example, if

the payment is used by the contractor in bad faith, the client
could press charges that could lead to legal restrictions and
could restrict the contractor from using any benefits acquired
from the extra payments.
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Chapter 2 Agency

Art. 2199. - Definition.

Agency is a contract whereby a person, the agent, agrees with another
person, the principal, to represent him and to perform on his behalf one
or several legally binding acts.

Review -It gives the agents definition by first stress as a contract .The
basic logic behind agency is that it gives responsibilities to another
persons.
Relevance -Since construction a Contract binding Industry Agency
gives rights to agree and represent some parties.
Art. 2201. - Acceptance of agency.
(1) Acceptance by the agent of his appointment may he either express or
implied.
(2) The appointment-as an agent shall be deemed to be accepted, unless
it be immediately refused, where it refers to functions which the agent
carries out in an official capacity or professionally, or where he holds
himself out publicly for such functions.

Review -To do the agent functions the agent shall be accepted by the
parties.
Relevance -Acceptance is necessary for construction industry.
Art. 2208. - Strict good faith.
(1) The agent shall act with the strictest good faith towards his principal.
(2) He shall disclose to his principal any circumstance which would
justify the revocation of the agency or a variation of its terms.

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Review -Good faith is the responsibilities of agent and the principal.

Relevance -Good faith in construction is important to do exact
responsibilities.
Art. 2209. - Effect.
(1) The agent shall ad in the exclusive interest of the principal and may
not, without the latter's knowledge, derive any benefit from any
transaction into which he enters in pursuance of his authority.
(2) He may not make me to the detriment of the principal of any
information obtained by him in the performance of his duties as agent.

Review -The agent shall be respect the principal interest.

Relevance -Every party shall respect his principal. For example The
Engineer shall respect the client’s interest.
Art. 2210. - Accounts.
(1) The agent shall account to the principal for all sums received by him
and all profits accruing to him in the course of his employment,
notwithstanding that the sums he received were not owed to the
principal.
(2) Where the agent converted to his own use monies he owed to the
principal, he shall he liable for the payment of interest as from the day of
such use, without it being necessary that notice be given to him.

Review -The agent shall be accounted for his responsibilities behalf of

the principal.
Relevance -In construction each parties is responsible for the qualities
of the construction.
Art. 2219. - Contractual remuneration.
(1) The agent shall be entitled to the remuneration fixed in the contract.

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(2) The court may reduce the remuneration fixed in the contract where it
appears excessive and out of proportion to the services rendered by the
agent.

Review -The remuneration shall be fixed in the contract.

Relevance -Construction agent remuneration shall be contract oriented.

Art. 2222. - Liabilities and damages.

(1) The principal shall release the agent from any liabilities which he
includes in the interest of the principal.
(2) He shall he liable to the agent for any damage he sustained in the
course of the carrying out of the agency and which was not due to his
own default.

Review -The principal shall have the right to release the agent.
Relevance -In construction the client (principal) has the right to release
the engineer with good reasoning.
Art. 2223. - Set-off.
(1) The principal may not refuse to pay the sums due by him to the agent
under the pretext that the transaction was unsuccessful.
(2) He may set-off these sums against those owed to him by the agent, in
particular by reason of the latter's default in the performance of the
agency

Review -The Principal may not refuse to pay for unsuccessful actions
but he may set off those owed to him to the agent.

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Relevance -In construction set off are the main causes for disagreement
and conflicts. Therefore managed under this law.
Art. 2231. Plurality of agents.
(1) Where several agents have been appointed for the same affair and are
required to act jointly any cause of termination of the agency occurring
in respect of the person of one of the agents shall terminate the authority
of all, unless otherwise agreed.
(2) The other agents shall notify the principal' upon becoming aware of
the cause of termination of the agency and shall in the meantime do
whatever is required in the circumstances to safeguard the principal's
interests.

Review –the existence of several agents in the contract

Relevance – it’s important in the industry since there will be some cases
of existence of many agents.
Art. 2232. - Death or incapacity of principal.
(1) Unless otherwise agreed, a contract of agency shall terminate by the
death of the principal or where he is declared absent, becomes incapable
or is adjudicated if bankrupt.
(2) The agent shall in such event continue his management where he had
commenced it and there is no danger in delay until the heirs or the legal
representative of the principal arc in a position to take it over
themselves.

Review -The contract between the principal and the agent shall be
terminated, if the principal becomes incapable, Death or bankruptcy.
Relevance -This is a case for usually construction stopped in the city.

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Conclusions
To put it in a nutshell we start from selecting a relevant article,
reviewing in writing the selected articles and finally mention the
relevance of the articles in brief words by the experience we get from
class. The work helps us to develop our ability by arguing in the issue
effectively during the time we meet. We would like to express our
deepest gratitude for our instructor for giving us the chance to get this
wonderful life experience.

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