Business Contracts

The contract for services, when its purpose is the construction of a real property structure, falls under the special provisions of Articles 1792 et seq. of the Civil Code, and subsidiarily under ordinary law. These provisions lay down the rules applicable to the lump-sum construction contract, which is characterized by the determination of a fixed price, based on an approved plan, in order to protect the project owner, but creates a risk both for the contractor, who may be compelled to carry out additional work, and for the project owner, who will have to pay the overall and final price set even if the cost of the works turns out to be lower (Article 1793 et seq.), as well as the rules relating to the liability of builders (Article 1792 et seq.). The latter are strictly liable, towards the project owner or the purchaser of the structure, for damage, including that resulting from a defect in the ground, which compromises the solidity of the structure or which, affecting one of its constituent elements or one of its equipment elements, makes it unfit for its intended purpose. This liability may be ten-year or two-year depending on whether the damage affects a structure or an equipment element. The contractor is also bound, for a period of one year from acceptance, by a defects liability warranty of perfect completion which extends to the repair of all defects reported by the project owner, either by means of reservations mentioned in the acceptance report, or by written notification for those revealed after acceptance (Article 1792-6 Civil Code).

332. Specific rules for the lump-sum construction contract.