Don’t get caught in the net — the main issues surrounding net contribution clauses

Where problems occur on a construction project resulting in a loss, the damage will often be the fault of more than one party involved in the design and construction of the project. The party who suffers the loss will want to recover the entirety of that loss from those responsible.

Requests from consultants and their insurers for the inclusion of net contribution clauses often arise when negotiating professional appointments and collateral warranties. Such requests will often be refused by employers and, if relevant, their funders. So, what are the main issues surrounding net contribution clauses?

The purpose of a net contribution clause is essentially to limit the liability of the person or persons responsible to an amount that would be just and equitable for them to pay based on the extent to which they are responsible for the loss…

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