Forms of Contract Flashcards
When is the JCT Standard Building Contract with Quantities (SBC/Q)
(Traditional: Lump Sum)
For larger works designed and/or detailed by or on behalf of the Employer, where detailed contract provisions are necessary and the Employer is to provide the Contractor with drawings; and with bills of quantities to define the quantity and quality of the work.
When is the Standard Building Contract Without Quantities (SBC/XQ) appropriate?
(Traditional: Lump Sum)
For larger works designed and/or detailed by or on behalf of the Employer, where detailed contract provisions are necessary and the Employer is to provide the Contractor with drawings; and with either a specification or work schedules to define adequately the scope and quality of the work and where the degree of complexity is not such as to require bills of quantities.
When is the Standard Building Contract Without Quantities (SBC/XQ) NOT appropriate?
Procuring ‘without quantities’ will result in a lump sum contract. There will be no re-measurement required and it can simplify the valuation process. This might initially give cost certainty for the client but there can be disadvantages later if variations are required, and there is disagreement about the rates to be charged for changes
When is a JCT Intermediate (IC) appropriate?
Traditional: Lump Sum
Where the proposed building works are of simple content involving the normal, recognised basic trades and skills of the industry, without building service installations of a complex nature or other complex specialist work;
Where the works are designed by or on behalf of the Employer, fairly detailed contract provisions are
necessary and the Employer is to provide the Contractor with drawings and bills of quantities, a
specification or work schedules to define adequately the quantity and quality of the work; and
This form is relatively sophisticated including many of the provisions seen in the JCT Standard Building Contract. These include provisions for named subcontractors (Schedule 2), loss and expense, bonds, sections, etc.
Are of reasonable-size and complexity but still relatively straight forward.
Are medium-size in terms of contract duration (in the region of 12 months is suggested by David Chappell in his guide to this contract);
(£150,000 to £1 million)
When is the JCT Minor Works (MWD) contract appropriate?
Traditional: Lump Sum
Where the work involved is simple in character;
Where the work is designed by or on behalf of the Employer;
Where the Employer is to provide drawings and/or a specification and/or work schedules to define adequately the quantity and quality of the work;
There is no provision in the Minor Works Contract for collateral warranties as in theory these projects are too small for this burden and furthermore there should not be an extensive chain of subcontractors.
(Max £250,000)
When is a Standard Building Contract with Approximate Quantities (SBC/AQ) appropriate?
(Traditional: Measurement)
For larger works designed and/or detailed by or on behalf of the Employer, where detailed contract provisions are necessary and the Employer is to provide the Contractor with drawings; and with
approximate bills of quantities to define the quantity and quality of the work, which are to be subject to remeasurement, as there is insufficient time to prepare the detailed drawings necessary for accurate bills of quantities to be produced; and
Price is based on the tender figure which is converted to an Ascertained Final Sum on remeasurement and
valuation of all work.
When is JCT Prime Cost Building Contract (PCC) appropriate?
Traditional: Cost Reimbursement or Cost Plus
For projects requiring an early start on site, where the works are designed by or on behalf of the Employer but where it is not possible to prepare full design information before the works commence;
This contract is most often used for alteration work and for urgent repair work (e.g. after fire damage) where an early start is necessary and the exact nature and extent of the Works cannot be determined until the work is actually under way. This is a high risk contract for the Employer in terms of cost, and much depends on the
efficiency of the Contractor in carrying out the Works economically.
When is JCT Major Construction Project (MP) appropriate?
Design and Build
For major works where the Employer regularly procures large-scale construction work and where the Contractor to be appointed is experienced and able to take greater risk than would arise under other JCT contracts;
Where the Employer has prepared his requirements and provided these to the Contractor;
Where the Contractor is not only to carry out and complete the works, but also to complete the design.
When is JCT Design and Build (DB) appropriate?
Where detailed contract provisions are necessary and Employer’s Requirements have been prepared and provided to the Contractor;
Where the Contractor is not only to carry out and complete the works, but also to complete the design;
The extent of the Contractor’s design input can vary considerably. Adequate time and care must be given to compiling the Employer’s Requirements, and this will normally mean the appointment of consultants by the Employer. In the event of any conflict between the Employer’s Requirements and the Contractor’s Proposals, the latter are stated to prevail. When evaluating tenders, adequate time must be given to checking these Proposals, particularly as the contract conditions refer to the Employer having satisfied himself that the Proposals are acceptable.
When is a JCT Management Building Contract (MC) appropriate?
Management: Management Contracting
For large-scale projects requiring an early start on site, where the works are designed by or on behalf of the Employer but where it is not possible to prepare full design information before the works commence and where much of the detail design may be of a sophisticated or innovative nature requiring proprietary systems or components designed by specialists.
Where the management contractor undertakes to manage the carrying out of the works through trade contractors who are contractually accountable to him.
The Management Contractor does not carry out any construction work but manages the Project for a fee.
When is a JCT Construction Management Appointment (CM/A) appropriate?
(Management: Construction Management)
Where a Construction Manager is to manage the project on behalf of the Employer; and
Where the Employer is to enter into direct separate trade contracts using the Construction Management Trade Contract (CM/TC) or a special Trade Contract.
What is the difference between management contracting and construction management?
The main difference is that under construction management the contracts for the works packages are placed directly between the client and the trade contractors, whilst in management contracting the contracts are made between the management contractor and the trade contractors.
Constructing Excellence Contract
CE
(Partnering)
Partnering is not a specific procurement method and consequently, the concept can be incorporated into most contractual arrangements. The JCT Partnering Charter (Non-binding) is for use where the parties wish to inculcate the partnering philosophy into their contractual arrangements.
What is a Framework Agreement
(FA)?
Framework Agreement
For the procurement of construction/engineering related works over a period of time.
Employers who carry out work regularly and wish to try and capture the benefits of long-term relationships within the supply chain should consider the use of the JCT Framework Agreement in conjunction with the appropriate JCT contract for the particular project
What is a Pre-Construction Services Agreement?
PCSA
This agreement is designed for the interim appointment of a general contractor by the employer to carry out preconstruction services, under a two-stage tendering procedure. The appointment follows first stage tenders and covers the period leading up to the contractor’s submission of a definitive second stage tender and entry into the main contract for the construction phase.
The appointment will enable the contractor to assist the consultant team with the development of detailed designs and development of the main contract works and specialist tender documents. The contractor’s involvement at pre-construction stage is widely viewed as being valuable and often essential in the final design process and preparations for the construction phase, including the programme, cost plans, buildability and specialist procurement.
