Penalty for liability in construction contracts

Abstract

Abstract: This research examines the penalty for liability in construction contracts. This contract is considered a form of insurance in general and liability insurance in particular. Legislators in both Iraq and Lebanon have not provided specific provisions for this contract. Therefore, we must refer to the general provisions stipulated by the legislator regarding insurance in Iraqi Civil Law No. 40 of 1951 and the guarantee contract in the Lebanese Code of Obligations and Contracts of 1932. This type of insurance pertains to construction contracts. Considering that insurance is a contingent contract, its purpose is to insure against the risk that befalls the building subject to the contract. The contractor enters into a liability insurance contract with the insurer, who undertakes to cover the risk, redress the damage, and compensate the affected third party. This relieves the contractor of the burden of liability towards third parties.