Training on Effective Contract Risk Management Masterclass

Module 1: Overview of Risk Management

• The Need for Contractual Relationships

• Defining Risk

• The Development of Risk Management

• Gaining a Competitive Advantage Through Risk Management

• Categories of Risk for Both Sides of a Contract

• Risk Assessment Process

• Managing Risk

• Qualifying Suppliers

• Defining Internal Control

• Proportionality of Control

• Case Study: Analysis of a high-profile contract dispute due to poor risk assessment

Module 2: Risk Mitigation and Management

• How to establish contracts with well-balanced risks between customer and contractor?

• Transferring Risk through Contract Types

• Firm Fixed Price or Lump Sum Contracts

• Cost Reimbursable Contracts

• Incentive Contracts

• Award-Fee Pricing Arrangements

• Using Risk Management post contract to reduce conflict

• Using Risk Management with the Parties to Improve the Contract during Tendering

• Indemnities

• Case Study: Successful mitigation of contract risks in a multi-national project

• Practical Exercise: Designing a risk-balanced contract clause

Module 3: Risks Associated Clauses

• External Events

• Force Majeure

• Strikes and Other Labor Disputes

• Risk and Title

• Assignment and Novation

• Other Clauses that Need Managing Risks between Parties

• Other Clauses that Need to Flow Down to Sub-Contractors

• Risks Associated with Sub-Contractors

• Case Study: Lessons learned from Force Majeure disputes and subcontractor risk failures

Module 4: Management of Financial Risks

• Controlling Risk Associated with Payments

• Currency Risk

• Economic Risk

• Fraud and Corruption

• Limiting or Excluding Liability

• Distinctions between Liability in Contract, and the General Law

• Gross Negligence

• A Review of Some Sample Clauses from Standard Contracts, and other Real Documents

• Case Study: Managing financial exposure in international contracts and lessons from a currency fluctuation incident

Module 5: Contingency Measures

• Mistakes and Misrepresentations

• Impracticability of Performance

• Remedies Generally

• Types of Remedies

• Liquated Damages

• Warranties

• Cover

• Discussion of Real Examples: (Participants are encouraged to bring real or made-up examples for discussion)

• Case Study: Real-life examples of contract contingencies and how effective planning prevented major losses

• Practical Exercise: Developing a contingency plan for a hypothetical contract scenario