Construction Contracts
Essential Terms
Basically, you need to make sure that all the essential terms in a contract are present. Otherwise, the contract won’t even be valid at all.
An essential term is one which must be agreed to, without which no contract comes into existence.
For example, completing the works by a particular date, or working to a particular programme. If you and your contractor fail to agree upon a date for completion, or a programme for the works, you have no valid construction contract.
Important Clauses
Aside from making sure that there is privity in terms of consideration and subject matter, you must also make sure that your contract contains clauses that relate to its execution.
One of the most important provisions are with regard to the payment schedule, which could be any of the following: lump sum, measurement/remeasurement, cost plus, contractual quantum meruit, variations, loss and/or expense, etcetera. Make sure that the specific basis for remuneration is in contract, and that it’s clear.
Your contract must also have provisions on repudiation, termination, and breach.
Specifically, those are embodied in the following:
Termination Clause
Variation Clause
