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A Study on the Minimization of Problems of the Direct Payment for Subcontractor's Work in Public Construction Project  

Cho, Young-Jun (중부대학교 건축공학과)
Publication Information
Korean Journal of Construction Engineering and Management / v.8, no.5, 2007 , pp. 101-108 More about this Journal
Abstract
To execute a construction project, many construction participants are engaged in the project. Especially many subcontactors role is very important, but their contract statute seems weaker rather than prime contractor. So to protect the subcontractor and to activate fair subcontract, Fair Transactions in Subcontracting Act was enacted. Direct payment to subcontractor clause of the act can protect subcontractor from the fear of insolvency of prime contractor, on the other hand can cause dispute about the interpretation of defect liability. Therefore the positive act and regulation were examined, and the effects of direct payment to subcontractor were analyzed. And the treatment direction of direct payment were suggested in this paper. Summary is as follows; (1) Statute of subcontractor for the ordering subject must be considered (2) Contract relationship must be reflected in the performance bond, subcontract bond, and subcontract construction conditions (3) To clarify the defect liability for the direct payment, retainage to guarantee the repair during contract period may be reflect on the subcontract construction conditions.
Keywords
Subcontract; Direct payment; Claim; Retention Money;
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