Contract Practice Flashcards
What is off-site vesting?
Where ownership of materials manufactured off-site is transferred to the Client upon payment
What is required to pay for off-site materials?
- Needs to be listed in the Contract
- In accoradance with ERs
- Vesting Certificate - signed by both parties
- Labelled with Client name and location fo the project
- Insured by the Contractor until delivered to site
- Bonds to be provided
Why was the JCT 2016 Minor Works with CDP recommended for the West-End retrofit project?
Scope of works were relatively small and didn’t require all the provisions of an SBC
What are some of the differences between SBC and MW?
Simpler provisions – MW doesn’t have a provision for named subcontractors
What were the CDP items for the St James’ project?
Floor box and grommet positions
Thickness of partitions
What was your role within the West-End retrofit project contract?
Undertook post contract procedures such as interim valuations, valuing change
What is an example of a change you valued on the West-End retrofit project?
Change in the colour of paint to the internal office plate floors
How did you value the change in paint colour on the West-End retrofit project?
Used JCT valuation rules, and used a star rate
What other JCT Contracts were considered for the West-End retrofit project?
The contract used was JCT Design & Build. An alternative contract would be SBC however my understanding is design was not yet fully coordinated and therefore the Contractor was used to progress the design from RIBA Stage 3
What is the difference between a Relevant Matter and Relevant Event?
Relevant Matter - Employers actions which entitle the Contractor to Loss and/or Expense
Relevant Event - An instance where the Contractor is entitled to an Extension of Time
Where in the contract is Relevant Matter defined?
Relevant Matter – Section 4
Where in the contract is Relevant Event defined?
Relevant Event – Section 2
What is the contractual process for notifying and assessing loss and expense claims?
(Clause 4.20) Contractor notifies as soon as reasonably apparent, follow with contractors’ initial assessment of loss and expense
What are some examples of relevant events?
Force Majeure
Variations
Adverse weather conditions
Strikes
In 2024 – epidemics, change of statute after the base date
What is the base date?
Reference of the date of the conditions when the tender was prepared and therefore reflects that price
What are the heads of claims?
1.Prolongation costs
2. General disruption
3. Finance charges
4. Loss of profits
5. Wasted management time
What are some changes in the JCT 2024 Suite of Contracts?
Gender neutral
Time to review EOT amended from 12 weeks to 8 weeks
Additional relevant events including epidemics
Reference to new building safety act
What are some common amendments you see in your projects?
- Amending final date for payment to suit Client financial cycle
- Amend rectification period from 6 months to 12 months
- D&B – Employers requirements take precedence over Contractor Proposals
Can you talk me through the valuation timelines in the JCT SBC 2016?
Interim valuation date – 7 days for QS to walk around site
Due Date, 7 days after IVD. QS to raise recommendation
5 days after due date – CA to raise interim certification
14 days after – final date for payment
5 days before final date for payment, Client can issue Pay less notice
What are the JCT Valuation rules?
- Where works are similar to use a Contract Rate
- Where works are similar but the conditions of works are different, use an adjusted fair rate (star rate)
- Where works are not similar, works should be valued fairly (market-test)
- Use dayworks where works cannot be measured
What are the contract particulars?
Sets out project specific variables in the agreement (retention, dates)
What is retention?
Percentage of money held by Employer as a safeguard for any defective/non-conforming works
What percentage retention do you have on your projects?
3% on SBC and D&B
5% on Minor Works and Intermediate
When is retention released?
Half after PC or sectional completion
Remaining after rectification period
What is required to form a contract?
- Offer and Acceptance
- Intent
- Consideration
- Capacity
Why have you recommended JCT contracts for your fit out projects?
Common in the fit-out industry and therefore saves time reviewing other contracts
Why was a Letter of Intent (LOI) required on this project?
To allow for items to be ordered ahead of start of site
What types of LOI are there?
- Letter of comfort
- Instructions to Proceed with Consent to Spend
- Letters Recognizing the Existence of a Binding Contract
What is included within the LOI?
- Scope of works
- Limit of expenditure
- Agreed CSA
- Payment terms
- ADR
- Liquidated damages
Are letters of intent legally binding?
Based on Ambleforth Abbey Trust v Turner & Townsend case law – no
Why would you recommend LOI over PCSA?
PCSAs are used when Employer wants Contractor to provide pre-contract services such as advise on design.
How did your client maintain control of design under the CDP packages?
Ensure robust information within CDP documents
CMT approval process
Novate design team
What was included in the loss and expense claim in your St James Project? And what was the total agreed cost?
- Prolongation costs
- General disruption
C. £130,000
