Lord, W; Liu, A; Tuuli, M M and Zhang, S (2010) A modern contract: Developments in the UK and China. Proceedings of Institution of Civil Engineers: Management, Procurement and Law, 163(4), pp. 151-159. ISSN 17514312
Abstract
The form of contract plays a significant role in the governance of relationships between parties. Recent research in project procurement emphasises relationships and cultural/behavioural issues. Such relationships operate within a formal (contractual) framework as well as an informal (interpersonal/social) framework since no contract is entirely transactional or entirely relational in nature. Sir Michael Latham suggested a cultural/behavioural change is required in the construction industry such that project participants should embrace a 'modern contract'. This paper examines the 13 Latham requirements of a modern contract in the latest edition of the NEC. The requirements are categorised, under what are labelled here as pillars of a modern contract, namely 'fairness', 'roles and functions of project participants', and 'payment operating mechanisms'. Developments in contracting practices in the Chinese construction industry, with a cultural tradition grounded in Confucian values of cooperation and sharing, are then examined and juxtaposed against the UK construction industry's movement towards a modern contract rooted in relational contracting. The developments show that China has nurtured a change towards the more formal, contractual, system of rights and obligations in their 'modernisation' of construction procurement in sharp contrast to the UK movement towards greater collaboration and cooperation.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | contracting; contracts & law; procurement |
| Index terms: | fairness, construction procurement, form of contract, construction industry, relational contracting, behavioural change, governance, Latham, collaboration, China, cooperation, project procurement, movement |
| Subjects: | business, management, industry analysis, health behaviours and lifestyles, psychology, contractual arrangements, Geography, industry policy reports, behavioral psychology, leadership |
| Topics: | Research Practice, Governance, Organizational Design, Geographical Context, Procurement |
| Descriptive scope: | 3 PCT |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here