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Faqs

Construction

Good Foundations are the Cornerstone of Building and Knowledge

Under section 604 of the Civil and Commercial Code (“CCC”)

“If the materials have been supplied by the employer, and the work is destroyed or damaged before due delivery, the employer bears the loss provided that such loss is not caused by any act of the contractor.”

First you have to provide the contractor with the opportunity to fix its works, as per section 595 of the Civil and Commercial Code (“CCC”) which states that:

“When it is possible to foresee with certainty, whilst the work is proceeding, that by the fault of the contractor, the work will be executed in a defective manager or contrary to the terms of the contract, the employer may notify the contractor to make good the defect or to comply with the terms of the contract within a reasonable time to be fixed in the notice”

However, if the contractor fails to remedy the defects in its works then

“the employer is entitled to have the work repaired or continued by a third person at the risks and expenses of the contractor”.

In terms of basic protections, yes, there are provisions of the Civil and Commercial Code (“CCC”) that simply state a protection as existing, regardless of whether or not you document or agree the protection in an agreement.

To take just one example, under section 592 “The contractor is bound to allow the employer or his agents to inspect the work during its execution”.

Generally under the Civil and Commercial Code, the hire of a contractor by an employer is governed as a ‘Hire of Work’ under Title VII. S.587 states that “A hire of work is a contract whereby a  person, called the contractor, agrees to accomplish a definite work for another person, called the employer, who agrees to pay him remuneration of the result of the work”.

Construction is touched upon by many other laws in Thailand such as the Building Control Act, the Town Planning Act and National Environmental Quality Act.

1. the number of ‘storeys’ on the building in the construction permit may be different to that which has been built. A seller or developer may try to pass off a ‘basement’ or ‘rooftop’ as a legal addition which may not be legal subject to the plans and the permit

2. the as-built drawings may materially deviate from the submission drawings provided to the authorities to obtain the permit

3. the construction permit may have been ‘endorsed’ to be ‘on behalf’ of a third party when in fact the endorsement does not by operation of law ‘transfer’ a permit

4. the building may be built on too steep a gradient in contravention of the gradient rules

5. the building may be built above a height limit of the building from ground level to the top of the building

6. the building may be built above a height limit from ground level measured whereby above a certain height above ground level, no buildings may be built.

Other matters should be checked in relation to building legality with thorough due diligence. The scope of due diligence will depend on the scope of an engagement and associated legal fees.

A construction permit allows a person or entity to build a property, accordingly only to the plans submitted to support the permit.

If the person or entity constructing under the permit completes the building but does not sell the building, then that person or entity will become the owner of the building – having constructed it.

If the person or entity construction under the permit transfers the permit to a third party prior to material completion of the building then the new owner may become the owner by simply having its name on the construction permit.

However, if the person or entity constructing under the permit completes the building, and then wishes to legally transfer the building to a new owner, then a sale must take place and be registered as having taken place by a bill of sale and payment of transfer fees and taxes by the parties.

Thai to Metric

1 Wah = 2 m
1 Talang Wah = 4 sqm
1 Rai = 1600 sqm
1 Rai = 400 Talang Wah
1 Rai = 0.40 Acre (approx.)
1 Rai = 0.16 Hectare
1 Ngan = 100 Talang Wah

Metric to Thai

1 m = 0.5 Wah
1 sqm = 0.25 Talang Wah
1 Acre = 2.53 Rai
1 Hectare = 6.25 Rai

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