The Value of a Construction Contract

Default of the Contractor, excessive extras, irregular invoicing and non-performance are, to name but a few, potential worries for clients during a construction project. From a contractor’s perspective; non-payment, delayed decision making and alteration to the scope of works are also valid concerns.

The Value of a Construction Contract

So is there a mechanism that can assist in limiting the effects of these outcomes for both parties? The answer is yes – the construction contract.

A number of standard form contracts are available, but perhaps one of the more frequently used are the Joint Contracts Tribunal (JCT) suite of contracts. They act as the overarching contract between Employer (client) and Contractor and make provisions to protect both contracting parties’ interests in a construction project.

The suite spans from the simplest, ‘Homeowner Contract’ series, which requires little or no administration from a consultant, right the way through to the ‘Design and Build’ and ‘Major Works’ varieties. Perhaps the most frequently used for the scale of works we are often involved with would be the various guises of the ‘Minor Works’ suite, or, less frequently ‘Intermediate Works’ versions.

Broadly speaking, the Contract is laid out in a way which offers protection against unauthorised changes in the design, non-performance or breaches of contract, mechanisms to allow extensions to the contract period and pre-agreed damages for any breach, as well as a whole raft of other articles and conditions that protect both, or all parties to the Contract.

The Contract is administered by an impartial Contract Administrator; who keeps a watchful eye on the works progression, quality of works, compliance with the specification and drawings, management of formal contractual certification and compliance with the conditions of contract. The role of Contract Administrator is only over following the end of the Rectification Period; a period which the Contractor is obliged to remedy any defects that have occurred over a given time period following Practical Completion.

If you are considering construction works and require assistance or guidance from the planning phase onward, then please feel free to contact one of the Building Surveying team.

 

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