On The Legal Strategies Of Project Payment Default

Default on construction payment has been a common problem in project industry for a long time, which is coming to the critical bottleneck of the development of this industry. In these years, although numbers of large-scale projects are commenced or coming to commence, few improvement has been taken in the pertinent legislation. The inefficiency of legislation and some inherent factors result in the deterioration of the defaults on project payment.Based on the current background of the common phenomenon of the defaults on project payment ,a legislative study is carried out in this thesis, which generally follows a basic train of thought as proposal of problem, analysis of problem, solution of problem. According to some analysis of the causation of this phenomenon, several preventive measures are proposed in this thesis.There are four sections included in this thesis. In the first section, a general introduction of research background, research approaches, main idea and current research progress are presented. In the second section, the major problem of the defaults on project payment is introduced. Arrear of construction payment is defined in legislative category, and the characteristic of current status on this social problem is demonstrated. In the third section, the urgency of exploration about the strategies against the defaults on project payment is discussed. Based on the investigation of available laws and legislation, the discussion on the issue of arrear on construction payment is carried out in the following three aspects: 1.legislation; 2. implementation of laws; 3.inherent problem of project industry. In the end of this section, according to the discussion on the necessity of an efficient solution, the gravity of this social problem is more highlighted. In the last section, the study on the strategies against the defaults on project payment is demonstrated. This part is the highlight of the thesis. Based on the analysis presented in the previous sections, two points about strategies are proposed, i.e. 1.prevention in legislative solution; 2.prevention in other field. More attention should been taken to prevent the defaults on project payment by legislation. In the description of legislative strategies against the defaults on project payment, a 'curve' prevention measure is proposed in this thesis, which is characterized by the emphasis of legislative aid for migrant workers. Moreover, the implementation of this measure should be enhanced. The 286^th item of the Contract Law can become more explicit and practicable with some amendments, which include the scope of priority compensation for payment on account of construction payment, the abandonment of priority compensation by contractor, the scope of some special projects without discount or auctions, and the subject of priority compensation. Besides, authors believe that the training of comprehensive building inspectors would play an important role in the prevention of the defaults on project payment.