Construction arbitration runs two clocks at once
A construction dispute under an arbitration clause has two sets of time limits running together: one from the work itself, one from the way the dispute is to be resolved. Missing the second makes the first academic.
The first clock comes from the work
Section 600 of the Civil and Commercial Code provides that, unless the contract says otherwise, the contractor is liable only for defects appearing within one year of delivery, or within five years where the work is a structure on land other than a wooden building. That period runs from delivery and is indifferent to how any dispute is to be resolved.
The second comes from the arbitration clause
Where the contract carries an arbitration clause and one side sues in court instead, section 14 of the Arbitration Act B.E. 2545 (2002) allows the defendant to apply for the case to be struck out, no later than the date of filing the defence or within the period allowed for filing it. That period runs not from delivery or from discovery of a defect, but from being sued.
Why the two collide so often in construction
Construction is work in which defects tend to surface late and arguments run long through inspection, rectification and negotiation. When one side finally sues, the other — used to thinking in section 600 terms — may be unprepared for the far shorter frame in section 14, which runs alongside the time for the defence.
What is lost by missing the section 14 deadline
Failing to apply within the section 14 period does not extinguish the rights under section 600. It means the dispute proceeds in court rather than before the tribunal the parties chose. What is lost is therefore the forum, the panel and the procedure — a difference the parties selected when drafting, and one that matters in construction work resting on expert evidence and heavy technical documents.
What to do first on being served
On being served in a construction dispute, what to check before the substance is whether the contract contains an arbitration clause and when the defence falls due, because together those decide whether any choice of forum remains. Examining defect liability under section 600 can continue afterwards; the choice of forum is available only within a much narrower window.
PREPARE
What to bring
- The construction contract and its dispute resolution clause
- The summons and the date the defence falls due, if sued
- The delivery date and the acceptance records
- Records of the defects and when each appeared
- The institution and rules the contract names
QUESTIONS
Questions this raises
We want arbitration but have already been sued in court.
Section 14 requires the application to strike out no later than the date of filing the defence or within the period allowed for filing it. What to check at once is therefore whether that period is still running, since the wording gives two alternatives. The detail of the clause and any ground that might make it unenforceable follow at the inquiry stage.
Does the five-year period cover every kind of construction?
Section 600 confines the five years to work which is a structure on land other than a wooden building; otherwise the period is one year from delivery. Both apply only where the contract does not provide otherwise, so the warranty clause has to be read alongside them, since the contract may set something different.
LAW
The legislation
- Civil and Commercial Code, section 600
- Arbitration Act B.E. 2545 (2002), section 14
ENQUIRIES
