This excerpt taken from the CTRP 20-F filed Jun 26, 2006.
SECTION 10 - DEFAULT, CLAIM AND DISPUTES
36.1 DEFAULT OF EMPLOYER:
(a) Fails to pay to the Contractor the amount of the advance payment due under Article 24;
(b) Fails to pay to the Contractor the amount due under Article 26.5;
(c) Fails to pay to the Contractor the amount due under Article 33.3;
(d) Any other conditions specified in the Contract.
In event of the occurrence of the issues under Sub-Clause 36.1, the Employer shall be responsible for breach of the Contract and pay to the Contractor for his loss suffered due to his default, and the extension of the Time for the Completion of Works shall be granted to the Contractor. The method adopted for the calculation and the exact payment for default shall be agreed in the Particular Conditions by the parties.
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36.2 DEFAULT OF CONTRACTOR:
(a) Fails to comply with the obligation under Sub-Clause 14.2 to complete the Works on the date for Completion specified in the Contract or on the date of the extension of the Time of Completion of the Works approved by the Engineer;
(b) Fails to comply with the obligation under Sub-Clause 15.1;
(c) Any other conditions specified in the Contract.
In event of the occurrence of the issues under Sub-Clause 36.2, the Contractor shall be responsible for breach of the Contract and pay to the Employer for his loss suffered due to the Contractors default. The method adopted for the calculation and the exact payment for default shall be agreed in the Particular Conditions by the parties.
36.3 The party who is deemed to be responsible for the breach of the Contract shall resume the performance of the obligation under the Contract in accordance with the instructions from the other party is not attributable.
37.1 During the performance of the Contract, the party shall be entitled to the payment from the other party against any loss he suffered and/or an extension of the Time of Completion of the Works, if the actual loss is not due to his own fault but attributable to the other party.
37.2 The Contractor shall proceed the claim for his loss in the form of writing pursuant to the procedures specified as follows:
(a) The Contractor shall give notice of his intention to the Engineer within 28 days after the event giving rise to the claim has first arisen.
(b) The Contractor shall send the contemporary report for the claim to the Engineer within 28 days after giving the notice.
(c) The Engineer shall respond within 28 days after receiving the report or the Contractor shall send to the Engineer the further evidence or the grounds upon which the claim is based as the Engineer may reasonably required.
(d) If the Engineer fails to provide the respond or the further instruction to the Contractor within 28 days after receiving the report of claim, the claim shall be considered to be verified by contemporary records.
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(e) If the event seems to be last for a period of time, the Contractor shall give the notice of intention in stages and shall provide the final report of claim to the Engineer within 28 days from the date of the termination of the claim.
37.3 The Employer shall be entitled to the payment of the losses he suffered due to the default of the Contractor pursuant to the time under Sub-Clause 37.2.
38.1 If any dispute of any kind whatsoever arises between the Employer and the Contractor in connection with the Contract or the execution of the Works, the dispute shall settled through consultation or through conciliation by a third party. If it is fails to be settled in amicable, the dispute may be settled through arbitration by an arbitration agency of China specified in the Particular Conditions or any other method the two party would prefer to.
38.2 The two parties shall, in every case, continue to proceed with the Works with all due diligence and be responsible for the care of the completed Works unless the following events happen:
(a) Unilateral breach has made it impossible to perform under the Contract, the parties agree to stop the works.
(b) Suspension required by the Conciliation and approved by both two parties.
(c) Suspension required by the Arbitration Agency.
(d) Suspension required by the Court.