Contract Administration (L2) Flashcards
(16 cards)
What are the main standard forms of Contract?
- JCT (Joint Contracts Tribunal)
- NEC (New Engineering Contract)
- FICID (International Federation of Consulting Engineers)
When might you recommend the use of a JCT Design and Build Contract?
- Employers wants a single point of responsibility for design and construction
- When the design is not fully complete at tender stage
- When the contractors design input is required
What are the key differences between JCT and NEC
- JCT is more traditional and prescriptive, based on legal president
- NEC is more collaborative, proactive and flexible
- JCT based on issues after they occur. NEC is more proactive (early warnings etc.)
Name some common Procurement routes?
- Traditional (Design-Bid-Build)
- Design and Build
- Management Contracting - MC procures trade contracts for client and manages / coordinates for the client
- Construction Management - Client appoints CM and all trade contractors. CM manages the work but does not carry risk
What are the key payment mechanisms in contracts?
- Interim payments (based on valuations)
- Advanced Payment (in some contracts)
- Retention (to cover defects)
What is Practical Completion?
- The point when the works are complete enough for the client to take possession and use the building
- Triggers: Release of half retention, start of defects period, end of Contractor liability for delay
Key differences between Intermediate Contract and Minor Works Contract?
- Sectional / Partial Completion (none for MW)
- Loss and Expense claims (none for MW)
- Retention Periods (3 months for MW)
- Requirement for programme (none for MW)
Key differences between Intermediate Contract and Design and Build?
- Contractor Proposals (only in D&B)
- Named subcontractors (none in D&B)
- Contract Administrator vs Employers Agent (EA for D&B)
- Design liability (only in D&B)
Construction contract dispute resolution mechanisms?
- Negotiation - First and most informal step. Easy fix
- Mediation - Voluntary and non-binding. Preserves relationships
- Conciliation
- Adjudication (Construction Act 1996) - 28 day process. Binding unless overturned later in Arb/Lit
- Arbitration - Private, formal process. Binding and enforceable
- Litigation (through the courts) - Public legal process
What is a collateral warranty?
A separate contract providing rights to 3rd parties (e.g., funders, tenants)
What documents are usually required to form a contract package?
- Employers requirements or specification
- Contractors Proposals (if D&B)
- Drawings
- Preliminaries
- Appendices (insurance details, warranties etc.)
What is an Extension of Time
A contractual mechanism to adjust the completion date due to qualifying delay events, while prevents the application of liquidated damages
What is a collateral warranty?
It extends the contractors liability for defects beyond the employer to third parties like funders or tenants, who wouldn’t otherwise have the right to claim
What is a subcontractor warranty?
A subcontractor warranty is a specific type of collateral warranty. It is from a subcontractor to a third party, giving the employer a direct right against the subcontractor
What is the difference between a collateral warranty and a subcontractor warranty?
A collateral warranty is a general term that extends the contractors liability beyond the employer to a third party. A subcontractor warranty is specific from a subcontractor to a third party.
Subcontractor warranties most common in D&B
What is Final Account?
Final account is the agreed total amount of money due to a contractor under the terms of the building contract, including all variations, loss and expense, provisional sums and adjustments.
Final account marks the financial close-out of the contract
