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A contract is a legally enforceable agreement between 2 or
more parties. It should stipulate all the actions
required during its execution and deal with all reasonably
foreseeable events that may occur.
A Home Extension Contract is a 45 clause agreement covering
all the basic requirements for domestic building works.
Simply fill in the blank parts then both
parties review and sign it.
The most common issues relating to domestic building work are
described below:
Cost
The works have an agreed contract sum which can only
be varied by defined means.
- A change to the extent, quality or method of the
works by the client will mean the contractor may
require additional money
- In certain circumstances the contractor may not
have been able to have foreseen costs of aspects of
the works, an example of this is foundations and
poor ground conditions.
- Therefore the contract allows provisional
sums for works that an experienced contractor
could not have foreseen.
Time
- The duration for the works to be completed in, is
just as important to the contractor as it is for the
client. The contractor will have time related
costs such as staff, scaffolding, overheads and
management.
- If the contractor runs over the agreed period for
the works they are already penalised with their ongoing
costs
- Therefore in the event of an overun the
contractor will not be paid anymore stage payments
but will collect all outstanding money when the
works are complete. This keeps the contractor
incentivised without penalising them more than they
already are.
- The Contractor is still assured of payment by
the money deposited in the Project Bank Account.
Quality
- The standards of the work installed have in certain
circumstances to meet statutory requirements and the
Building Control officer will not pass any work that is
not upto the required standard.
- However certain aspects re not within the remit of
the BCO, items such as decoration, security of the
premises and workmanship of elements such as plastering
and poorly fitted joinery (excepting fire doors and the
like)
- Therefore the contract regulates all works to
the requirements of the NHBC and that of suitably
qualified and experienced contractors.
Payments
The contractor is not expected to fund the whole of
the works from start to finish unless a specific
agreement is in place. The contractor would need
to borrow the money and therefore pass on the interest
payments to the client if this was the case.
Equally the client should not pay for something they don't
physically have.
- Therefore 'stage' payments are to be agreed at
the outset and formally recorded in the contract.
- No upfront payments are permitted. The
contractor is assured of payment via the project
bank account.
Design
The works will need to be designed by a competent
person to ensure adequate standards and compliance with
statutory requirements. Either the contractor or
the client can provide the design.
- Therefore the contract will stipulate which
party provides the design and the standard that it
should be up to.
Approvals
Third party approvals will be required for all but
the simplest of works. Bodies such as the Local
Authority Planning and Building Control departments, electricity and gas
suppliers etc all need coordinating and inspections
carried out.
- The responsibility for managing these parties is
clearly agreed in the contract.
Insurance
The client will need insurance for the property as
it stands prior to the works. It would be
uneconomical for the contractor to provide further
insurance for the works. However the contractor
cannot benefit from his own wrongs.
- Therefore the client will inform their insurance
provider of the impending works and deal with any
premium alterations as a consequence.
- The contractor will ensure that they have public
liability insurance.
Facilities
The contractor may need certain facilities to
undertake the works, items such as running water and
electricity. Temporary toilets and kitchens may be
required by the client during the works.
- The allocation of who provides what is clearly
laid out in the contract.
Completion
The works are only completed when certain criteria
is fullfilled.
- The contract determines the criteria including
testing, defects and approvals.
After Completion
Certain elements of the works need to 'bed in' to
determine if they are installed correctly.
- The contract retains the contractor for a period
to remedy defects arising from poor installation.
Changes
If the client wishes to change anything whether it
be installed or planned then the contract needs to
permit them to do so otherwise the contractor can
refuse.
- The contract allows the client to change their
mind as long as it is within the general scope of
the works.
Safety
The 'site' may be part of a residential area and as such
consideration should be given to neighbours and public.
- The contract determines the criteria to be used
to ensure the area is kept as safe as possible.
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