4. Contracts And Procurement Flashcards
What is a contract?
A legal relationship and agreement between parties (e.g. individual companies) which is enforceable by law (contract law comes under civil law rather than criminal). Under the housing act and the LI code of Practice, contracts have to be in writing. Construction contracts are between the contractor and client.
What is a standard term contract and what are the benefits?
This specifically covers the who, where, when (start/end dates), what (nature and extent), cost of project and the terms. The benefits are that the parties involved have more certainty of the roles, they will be more familiar with the contract and the contract is suited to a purpose.
What are the contract documents needed for valid construction contracts?
- Production information: illustrative/quantititave drawings, bill of quantities
- Contract documents: contract (JCLI/JCT), comprising typically of the agreement, the parties, the recitals, articles, witnesses and conditions.
What are the typical contents of a contract?
Definition and interpretation
Carrying out the works
Control of the works
Payment
Injury, damage and insurance
Termination
Settlement of disputes
What would you consider when selecting a contract?
Type of work
Size of contract
Complexity of work
Whether the project is soft/hard landscape or both
Degree of risk, how reputable and reliable the company you’re entering into legal relations with is
What are some common types of construction contract?
NEC - New Engineering and Construction, favoured by highways, EA and defence, range of payment options, BIM requirements, has stand alone landscape/maintenance contracts
JCT - Joint Contractors Tribunal, typically for building contracts, range of contracts such as intermediate or minor works
JCLI - Joint Council for Landscape Industries
- appropriate for hard and soft landscape projects
- types: landscape works contract, landscape maintenance works contract, landscape work with contractors design and landscape contractor for homeowners
- similar to JCT
- contract only responsible for making good defects post practical completion if they do softworks maintenance
- differs from other contracts with landscape specific clauses for “living material” and vandalism
What contract might you consider for soft landscape projects?
The JCLI as it makes specific reference to “living material”
What is the JCLI contract and its advantages to landscape architects?
JCLI is a standard contract specifically designed for landscape works, both hard and soft, and appropriate for a project value up to £250k. It is similar to JCT but has clauses relating specifically to landscape works such as “living material and vandalism”.
There are a number of types of contract - landscape works, maintenance, homeowners and contractors design.
What is an NEC contract?
A New Engineering and Construction contract
This is favoured by highways, Environment Agency and defence projects
There are a range of payment options
BIM requirements
And it has stand alone landscape and maintenance contracts
What is a JCT contract?
Joint Contracts Tribunal
-Typically for building contracts
- There are a range on contracts such as intermediate and minor works
How long does a JCLI contract last?
Usually 2 years but this is sometimes extended if a project is particularly important or complex or if there are specific issues that need addressing.
What procurement options are there in terms of contracts?
There are several procurement options for construction contracts:
Traditional contract
Design & Build contract
Management contract
Framework agreements
Partnering
Design competitions
What is traditional procurement?
This is the most simple approach - a project is designed, it then goes to tender, contractor is appointed and the project is constructed.
Design consultants remain involved throughout
Usually lump sum contracts
Works are defined at the pre tender stage
Client has more control and difference contracts for the design team and contractor
What is a design and build contract?
The main contractor is appointed to both design and construct the works
There is a single point of delivery as opposed to a client side design team and a contractor team - thus reducing the risk to the client
Contractor is the landscape architects client
Design team can also be appointed by the client prior to construction and design work taken on by contractor during construction or design team are novated to contractor. The contractor then becomes the design teams client.
What is a framework agreement?
An agreement that sets out terms by which contractors will carry out projects - contractors procure a tender, these are accepted onto the framework and may be given a project based on the terms in the framework agreement.
These are used by local authorities, offering contractors repeat work. It is efficient and easy for both parties as all are used to the work - familiarity and less work in procurement.
How would you get onto a framework?
It is similar to any other tender in that a contractor tenders as usual, however the rates would be binding for future jobs won via the framework. Typically rates are slightly lower due to less admin involved and less effort required to win work.
What do you consider when selecting a procurement method?
Find a balance between cost, certainty and time. This is important as procurement routes can determine the appoint of consultants, types of contract used and tendering method.
Cost certainty
Project characteristics (time, size, complexity and location)
Risk
Time (inc. phasing)
The client (risk adversity, resources, experience, public vs private)
External factors (economic, commercial, political, legislative)
Strengths of each procurement method are…
Cost certainty: traditional, design & build
Time efficiency: design & build, framework
Quality: design competition, partnering and traditional
What are the most common uses for each procurement method?
Traditional contracts: most common at Define
Design & Build: more common in public sector or specialist projects, i.e. hospitals/schools
Management contracts: less common
Framework agreements: local authorities, e.g. Environment Agency
What is the maximum project cost for a JCLI contract?
£250k
What are the essentials of a valid contract?
- An INTENTION to enter into legal relations
- CONSIDERATION - an agreement must be supported by a consideration of something in return
- AGREEMENT - after offer and acceptance, there is an agreement of an offer between two or more parties
What is management procurement method?
A procurement method used when the client wants speedy completion. The management contractor works alongside the design team and sub contractors carry out the work.
Explain the term procurement
Procurement is the process of finding and agreeing to terms and acquiring goods, services or works from an external source, often via tendering or competitive bidding process.
In our work, it is most likely to be the way in which a contractual relationship is reached.
What are the conditions of contract set out in the JCLI?
- Definition and interpretation
- Carrying out works
- Control of works
- Payment
- Injury damage and insurance
- Termination
- Settlement of disputes
