Contract Practice Flashcards
(48 cards)
What are the different suites of construction contracts available?
- JCT suite of contracts
- NEC4
- FIDIC
- DEFCON
Give 3 examples of JCT contracts
- JCT Standard Building Contract
- JCT Design & Build
- JCT Minor Works Building
- JCT Prime cost
When would the JCT standard building contract be appropriate?
When the design is complete for construction and a detailed BoQ can be provided. When the client wants to retain all control over the design. To get the most competitive form of tender.
When would a JCT design & build contract be most appropriate?
- When the designs are incomplete
- When contractor input is of value or to get an PCSA agreement
- To speed up the process so design and construction can overlap
When do you use a minor works contract?
Smaller less complex projects typically for domestic projects where work is valued at no more than £500,000
When would a prime cost contract be appropriate?
When there is a good relationship between the contractor and client. The scope of works is hard to define. Time is a much higher priority than cost.
Give the options of contract available under the NEC4
- Op A priced with activity schedule
- Op B Priced with BoQ
- Op C target cost with A S
- Op D target with BoQ
- Op E cost reimbursable
- Op F construction management
What types of projects typically use NEC contracts?
Infrastructure projects
Explain how an NEC Option C contract works
NEC used an activity schedule with a target cost which means if the project cost is over or under the budget there is a pain/gain shared between the client and contractor
What are the principles of the NEC contract?
- Good relationship management
- Flexibility, for a variety of projects
- Clarity, simple and straightforward
What are the key differences between the JCT & NEC
- NEC includes a contract as a contractual document that is reviewed on a monthly interval
- JCT deals with relevant events and relevant matters separately as opposed the CEs that deal with it together
- Early warning notices must be raised under an NEC and have time bars associated
What are the 4 things necessary to form a contract
Offer
Acceptance
Consideration
Legality
What is a collateral warranty?
A collateral warranty is a separate document that sits besides the main contract to bridge the contractual gap between designers and subcontractor and the client in the case of the main contractors insolvency.
Why are collateral warranties needed?
Due to privity of contract between the two parties which means only those party to a contract can enforce it
What are the key elements that make up a JCT contract?
- Agreement (who)
- Recitals (what)
- Articles (how much and EA, PD)
- Contract Particulars (Dates and insurances)
- Conditions
- Contract amendments
- Employers Requirements
- Contractors proposals
- Contract Sum Analysis
Give an example of where you have negotiated a contract
On my Bath Road project I negotiated a 2.5% discount on. The Brickwork subcontractor in exchange for a reduction of payment terms from 35 days to 14 day terms
What differences would there be in the contract docs between a £1m cladding subcontract and a £25k scaffolding subcontract?
- Cladding is higher risk and had design so would need more comprehensive contract amendments specific to design.
- A detailed programme for cladder
- Collateral warranty
- Professional Indemnity insurance
- More comprehensive construction info and details.
- Tender pre start giving details of their construction methodology
- Retention, bonds, PCG
Give an example of when you might use a Sub-contract Tender Sum and where you would find that in the contract
For a remeasurable contract such as fire stopping or diamond drilling where the full scope is undefined and Article 3B in the contract
What is the clause for a relevant events and give 3 examples
2.26
.2 Employers instructions
.3 Deferment of possession
.8 adverse weather conditions
.14 Force Majeure
What is the clause for relevant matters and give 3 examples
4.21
.1 Changes
.2 Employers Instructions
.3 any impediment, prevention or default from the employer
What are the responsibilities of the contractor under the JCT?
- Execution of the work (and design if applicable)
- Compliance with building regs
- Meet programme
- Variations and instructions
- Site management
- H&S and CDM regs
- Communication and reporting
Give an example of a variation instruction you received an how you dealt with it under the contract
Bath Road access control change
1. Required change
2. Explained what we had priced and that the work would be Vo cost
3. Priced variation based on SC quote
4. Asked for formal instruction
5. Proceeded with the work by instructing the M&E subcontractor
What would you find in the contract particulars?
- Base date
- Contract Sum
- Retention
- Insurance levels
- LDs
- Date of possession and date for completion
- Rectification period of defects
What is in the contract recitals under the JCT?
What the contract is for eg the build description and what forms part of the contract ERs and CPs
