Contract Practice Flashcards
What is the effect of partial possession and sectional completion on liquidated damages?
Relieves the contractor from liability for liquidated damages for those parts.
What do liquidated damages include:
o Loss of rent.
o Loss of income.
o Fees.
o Storage costs.
o Rental costs.
o Fines imposed by third parties.
o Financing costs.
What are the issues with docusign?
Anyone can sign it/ forgery
Traditional witnessing is not followed (no one actually witnesses)
What should contractors and clients sign/initial when signing a contract?
Attestation
Amendments and Contract documents
What is retention?
A percentage of the contract sum withheld by the client to ensure the contractor has completed their duties under the contract.
When are retentions released?
Half is released upon the achievement of practical completion and a certificate being issued. The full amount is released following the issuing of the final certificate.
What is under hand contract timescale?
6 years
What is deed contract timescale?
12 years
What makes up a contract?
OFFER, ACCEPTANCE, INTENT, CONSIDERATION
What are liquidated damages?
Pre-determined damages set at the time that a contract is entered into, based on a calculation of the actual loss to the client.
What is the time period for responding to a request for an extension of time?
8 weeks
If you refused an extension of time, what would happen next?
The completion date shall remain as it was and the employer may be entitled to damages from the contractor as a result.
What is a relevant event?
A relevant event is time related; however, they can run alongside claims for loss and expense.
What are relevant events under a JCT contract?
- Contract administrator’s instructions
- Delays in giving the contractor possession to the site
- Epidemic
- Exceptionally adverse weather conditions
- Force Majeure (wars, civil unrest, earthquakes)
- Strikes
- By those engaged in the trades on site, transportation and manufacture of materials
- The discovery of asbestos, antiquities or contaminated objects
- Changes in statutory regulations and requirements
What are the key differences between NEC and JCT?
JCT contracts are more commonly used and well known than NEC contracts.
JCT contracts focus on risk allocation and adopt a more adversarial approach, while NEC emphasizes collaborative working and mutual trust.
How do NEC and JCT differ in their approach to collaboration?
NEC contracts are more focused on agile collaboration between the employer and contractor when resolving cost, quality, or time issues.
JCT allows for greater control over project delivery with an even split of risk shared.
In what sectors are NEC contracts more commonly used?
NEC contracts are more often used for work in the public sector, including transport, education, and healthcare infrastructure.
What is novation?
Novation is where a commercial party’s contractual rights and obligations are transferred to a third party.
What is a traditional lump sum contract ?
A lump sum contract is the traditional means of procuring construction, and involves a single ‘lump sum’ price for all the works being agreed before the works begin. This means that the contractor is able to accurately price the works they are being asked to carry out.
What is the base date ?
Base date: the base date is usually set at around the time of return of tenders. base date’ is a reference date from which changes in conditions can be assessed.
Under JCT what are included within the contract documents ?
drawings;
specification;
work schedules;
Why were JCT Suites updated?
To reflect the recent legislative changes including the Building Safety Act 2022, the updated termination, accounting and payment provisions in keeping with Housing Grants, Construction and Regeneration Act 1996 and the new insolvency grounds introduced in the Corporate Insolvency and Governance Act 2020.
Why would you choose a standard building contract?
It is intended for larger projects where detailed contract provisions are necessary. It includes provisions for collaborative working, sustainability, advance payment, bonds (advance payment, off-site materials and retention), third party rights and collateral warranties.
Why would you chose an intermediate contract?
When provisions are required for collaborative works, sustainability, advance payments, named specialists, bonds, third party rights and collateral warranties but the works are still relatively simple.
