Construction Risk

Subject LAWS70149 (2013)

Note: This is an archived Handbook entry from 2013.

Credit Points: 12.50
Level: 7 (Graduate/Postgraduate)
Dates & Locations:

This subject is not offered in 2013.

Time Commitment: Contact Hours: The total class time is between 24 and 26 hours.
Total Time Commitment: Not available
Prerequisites: None
Corequisites: None
Recommended Background Knowledge:

Applicants without legal qualifications should note that subjects are offered in the discipline of law at an advanced graduate level. While every effort will be made to meet the needs of students trained in other fields, concessions will not be made in the general level of instruction or assessment. Most subjects assume the knowledge usually acquired in a degree in law (LLB, JD or equivalent). Applicants should note that admission to some subjects in the Melbourne Law Masters will be dependent upon the individual applicant’s educational background and professional experience.

Non Allowed Subjects: None
Core Participation Requirements:

The Melbourne Law Masters welcomes applications from students with disabilities. The inherent academic requirements for study in the Melbourne Law Masters are:

  • The ability to attend a minimum of 75% of classes and actively engage in the analysis and critique of complex materials and debate;
  • The ability to read, analyse and comprehend complex written legal materials and complex interdisciplinary materials;
  • The ability to clearly and independently communicate in writing a knowledge and application of legal principles and interdisciplinary materials and to critically evaluate these;
  • The ability to clearly and independently communicate orally a knowledge and application of legal principles and interdisciplinary materials and critically evaluate these;
  • The ability to work independently and as a part of a group;
  • The ability to present orally and in writing legal analysis to a professional standard.

Students who feel their disability will inhibit them from meeting these inherent academic requirements are encouraged to contact the Disability Liaison Unit:


For more information, contact the Melbourne Law Masters office.

Phone: +61 3 8344 6190

Subject Overview:

Risk and insurance are at the heart of all construction projects, yet their role and detailed provisions are often misunderstood, leading to significant losses and disputation. The already-sophisticated contracting landscape has, in recent years, been made significantly more complicated by the introduction of proportionate liability reforms. This subject will examine these issues with particular emphasis on how risk can be managed to minimise losses.

The lecturers Tony Horan and Peter Wood are expert navigators in relation to these complex issues. They have leading-edge expertise in advising upon risk, security for performance and insurance in the construction context.

Principal topics will include:

  • Identifying risk in a construction project and how various industry participants (including principals, contractors, designers, professional advisers, insurers, security providers, and statutory and government authorities) may bear responsibility
  • Philosophies and commercial drivers affecting risk allocation in construction contracts and consultancy agreements, and how these are reflected in standard forms
  • Security for performance mechanisms, including cash retentions, unconditional undertakings, parent guarantees, insurance bonds, adjudication bonds and other instruments
  • Insurance products available to the construction industry (including public liability, works insurance, professional indemnity workers’ compensation and domestic building insurance) and the law relating to them, including regulation by legislation, common law principles and treatment under standard-form construction contracts and consultancy agreements
  • Proportionate liability regimes (including Part IVAA of the Wrongs Act 1958 (Vic)) and their impact upon contract risk allocation.

A student who has successfully completed this subject should:

  • Understand the theoretical and practical drivers for risk allocation in construction projects
  • Be familiar with the risks that can materialise during the planning, design and construction phases of a project, and how those risks may be allocated to, or assumed by, various participants
  • Have a detailed understanding of the law and industry practice relating to insurance and security for performance
  • Appreciate the impact that proportionate liability schemes have on loss recovery
  • Be able to provide meaningful advice about the various options that are available to a range of industry participants in structuring and administering projects in relation to these matters
  • Be able to contribute meaningfully to ongoing industry debates about optimal ways of dealing with these matters at a policy level.

Take-home examination (100%) (25–28 October)
10,000 word research paper (100%) (4 December) on a topic approved by the subject coordinator

Prescribed Texts:

Core subject materials will be provided free of charge to all students. Some subjects require further texts to be purchased. Visit the Melbourne Law Masters website for more information about this subject.

Breadth Options:

This subject is not available as a breadth subject.

Fees Information: Subject EFTSL, Level, Discipline & Census Date
Links to further information:

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