Building Contract

What is a building contract

A building contract is the warranty that the workmanship and materials will be quality driven. The builder as per the building contract needs to get a detailed survey for the foundation work as well as for the slab and thus he will be able to avoid the escalation in price. The builder can seek variations to the contract but there are limits as to the variations as per the law.

The building contract consists of the 3 different documents. The first is the building contract which is legal and which informs of the role, responsibilities and rights of the consumer as well as the builder.

The second document is the specification which lists all what needs to be carried out and what are the items that need to be supplied as well as installed and the way the work is to be undertaken. This is a very technical document.

The third document consists of the plans and drawings which are prepared by the builder, architect or draftsperson. You need to review these drawings carefully as it ensures the details of the work which are to be done and it needs to be approved also by the building surveyor and it should bear the approval stamp.

In order to avoid confusion at a later date, it is necessary at the time of signing the contract to request for two copies of the contract documents and each of the pages of each of these documents should be signed by the builder as well as the owner.

Building Contract
Building Contract
Building Contract
Building Contract
Building Contract
Building Contract
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Sample Template Preview

Building contract.

Agreement made on _________[date], between _________ of _________, referred to as contractor, and _________ of _________, referred to as owner.
Owner is about to erect a _________ at _________, on _________ Street, _________ and has caused _________, architect, to prepare drawings and specifications of the _________.
Contractor has signified his [her] willingness to erect _________ in accordance with the drawings and specifications attached to this contract and signed by contractor, owner and architect, and in accordance with the conditions and for the consideration set forth below.
It is agreed between the parties, in consideration of their mutual agreements, as follows:
1. The contractor agrees:
A. To furnish all the materials and perform all of the work for the erection of a _________ building on the premises of owner at _________, in accordance with the plans and specifications prepared by _________, architect, signed by owner and contractor, and attached to and made a part of this contract.
B. To commence work on or before _________[date], and to finish the whole of the building and deliver up the building complete in every respect according to the drawings and specifications, and to the satisfaction of the architect, on or before _________[date], unless that day or time shall be extended as provided below for or by agreement endorsed on this contract and signed by the parties; and then, in such case, on or before the extended day or time.
C. To give all requisite notices to the proper authorities, obtain all official inspections, permits, certificates and licenses made necessary by the work in his [her] charge, and pay all proper and legal fees.
D. To furnish a bond covering the faithful performance of the contract and payment of all obligations arising under the contract, in such form as owner may prescribe and with such sureties as he [she] may approve. If the bond is required by instructions given previous to the submission of bids, the premium shall be paid by contractor; if subsequent to submission of bids, it shall be paid by owner.
E. To maintain such insurance as will protect him [her] from claims under worker’s compensation acts and from any other claims for damages for personal injury, including death, which may arise from operations under this contract, whether such operations be by himself [herself] or by any subcontractor or anyone directly or indirectly employed by either of them. Certificates of insurance shall be filed with owner, if he [she] so requires, and shall be subject to his [her] approval for adequacy of protection.
F. To provide proper facilities to enable owner and architect, and their representatives, to have access to and inspect the work during its progress.
G. To indemnify and save harmless owner against all loss, costs or damage on account of injury to persons or property occurring in the performance of the contract, together with any and all attorney’s fees incurred by owner on account of the injuries.
H. That owner may make any alterations, deviations, additions or omissions from the plans and specifications, or either of them, which he [she] shall deem proper and architect shall advise, by a written order signed by architect and approved by owner, without affecting or making void this contract and in all such cases architect shall value or appraise such alterations, and add to or deduct from the amount agreed to be paid to contractor any excess or deficiency occasioned by such alterations. In case any alterations or deviations are made, such further time may be allowed for completion of the work caused by the alterations or deviations as architect shall decide to be reasonable.
If contractor should be adjudged a bankrupt, or if he [she] should make a general assignment for benefit of his [her] creditors, or if a receiver should be appointed on account of his [her] insolvency, or if he [she] should persistently or repeatedly refuse or should fail, except in cases for which extension of time is provided, to supply enough properly skilled workers or proper materials, or if he [she] should fail to make prompt payment to subcontractors or for material or labor, or persistently disregard laws, ordinances or the instructions of the architect, or otherwise be guilty of a substantial violation of any provision of the contract, owner, on certificate of architect that sufficient cause exists to justify such action, may, without prejudice to any other right or remedy and after giving contractor _________ days’ written notice, terminate the employment of contractor and take possession of the premises and of all materials, tools and appliances on the premises.
2. The owner agrees:
A. To pay the contractor for the performance of the contract, subject to additions and deductions provided in the contract, in current funds as follows: _________[state lump sum amount, unit prices, or both, as desired in individual cases].
Where quantities originally contemplated are so changed that application of the agreed unit price to the quantity of work performed is shown to create a hardship to owner or contractor, there shall be an equitable adjustment of the contract to prevent such hardship.
The owner shall make payments on account of the contract as provided in the contract, as follows:
On or about _________ day of each month _________ percent of the value, based on contract prices, of labor and materials incorporated in the work and of materials suitably stored at the site up to _________ day of that month, as estimated by architect, less the aggregate of previous payments; and on substantial completion of the entire work, a sum sufficient to increase total payments to _________ percent of the contract price _________[insert any provision made for limiting or reducing the amount retained after the work reaches a certain stage of completion].
Final payment shall be due _________ days after substantial completion of the work provided the work is fully completed and the contract fully performed.
If after the work has been substantially completed, full completion is materially delayed through no fault of contractor, and architect so certifies, owner shall, on certificate of architect, and without terminating the contract, make payment of the balance due for that portion of work fully completed and accepted. The payment shall be made under the terms and conditions governing final payment, except that it shall not constitute a waiver of claims.
B. To effect and maintain fire insurance on the entire structure on which the work of this contract is to be done and on all materials, in or adjacent to and intended for use on the structure, to at least _________ percent of the insurable value of the structure. The loss, if any, is to be made adjustable with and payable to owner as trustee for whom it may concern.
3. It is further agreed between the parties as follows:
A. The work shall be executed under the supervision and direction of the architect, _________, and his [her] decision as to all matters relating to the performance of this agreement shall be final and binding on the parties except as otherwise provided in this agreement.
Upon receipt of written notice that the work is ready for final inspection and acceptance, architect shall promptly make such inspection, and when he [she] finds the work acceptable under the contract and the contract fully performed he [she] shall promptly issue a final certificate, over his [her] own signature, stating that the work provided for in this contract has been completed and is accepted by him [her] under the terms and conditions of the contract, and that the entire balance found to be due contractor, and noted in the final certificate, is due and payable. Before issuance of the final certificate contractor shall submit evidence satisfactory to architect that all payrolls, material bills, and other indebtedness connected with the work have been paid.
B. Neither final payment nor any part of the retained percentage shall become due until contractor, if required, shall deliver to owner a complete release of all liens arising out of this contract, or receipts in full in lieu of a release and, if required in either case, an affidavit that so far as he [she] has knowledge or information the releases and receipts include all labor and material for which a lien could be filed. Contractor may, if any subcontractor refuses to furnish a release or receipt in full, furnish a bond satisfactory to owner, to indemnify him [her] against any lien. If any lien remains unsatisfied after all payments are made, contractor shall refund to owner all monies that the latter may be compelled to pay in discharging such lien, including all costs and a reasonable attorney’s fee.
C. If contractor be delayed at any time in the progress of the work by any act or neglect of owner or architect, or of any employee of either, or by any other contractor employed by owner, or by changes ordered in the work, or by strikes, lockouts, fire, unusual delay in transportation, unavoidable casualties or any causes beyond contractor’s control, or by delay authorized by architect pending arbitration, or by any cause which architect shall decide to justify the delay, then the time of completion shall be extended for such reasonable time as architect may decide. No extension shall be made for delay occurring more than _________ days before a claim is made in writing to architect. In case of a continuing cause of delay, only one claim is necessary.
D. If any dispute or difference shall arise between owner or his [her] architect and contractor, with respect to any matter or thing arising out of, or in any wise relating to, the contract, and not agreed to be determined by architect, such difference or dispute shall, immediately after it has arisen, be referred to final determination and award of two competent persons as arbitrators, one of whom shall be chosen by owner and the other by contractor, and of an umpire to be named by the two arbitrators, and the award of the arbitrators, or of their umpire, if they disagree, shall be final and conclusive, as to the matters referred to them, provided the award be made in writing under their, his or her hands or hand, and ready to be delivered to owner and contractor, within _________ months after such reference, or within such further time, not exceeding _________ months from the time of such reference, as the arbitrators or their umpire shall by writing, under their, his or her hands or hand, from time to time appoint. The costs and charges attending such reference shall be in the discretion of the arbitrators or their umpire, and shall be paid as they, he or she by their, his or her award, shall direct.
E. Neither party to the contract shall assign the contract or sublet it as a whole without the written consent of the other, nor shall contractor assign any moneys due or to become due to him [her] under the contract, without the previous written consent of owner.
                                                                                                                     [Signatures and seals]
[Acknowledgements or attesting witness if necessary or desired]
[Annex plans and specifications]