_Extracts from the Book estimating &

Tendering for Building Work

3rd Edition|Page 34-35
By Martin Brook

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  Standard form of contract exist to identify the roles
and responsibilities of the parties, and their agents
 Contract provide rules and mechanisms to protect
and direct the parties to a contract should things go
wrong
 Clients can use standard forms of contract e.g.
from the Joint Building Council or Architectural
Association or a custom made contract.
 There are many forms of contract published using
different principles, terminology and apportionment
of risks

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  Construction contracts depend on the
general principle of law. A contract is “an
agreement between two or more parties
which is intended to have legal
consequences”.
 In construction, the contract is generally
for producing a building or part of the
built environment. It can be entered into
in any of the following four ways:

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1. Implied by conduct of parties; a contractor may submit
an offer and later have access to the site.
2. By word of mouth; typically where an offer is accepted
e.g. by telephone
3. By exchange of letters ; common for small domestic
works e.g. extension, alteration or repair.
4. Using a written contract; the contract documents often
include the enquiry documents , the written offer,
minutes of meeting, tender-stage correspondence, a
programme, a method statement and a formal contract.

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  There must be an offer by one party and an
acceptance by the other or others
 Each party must contribute something of value
to the other’s promise: a client is responsible
for making payments and the contractor must
complete the construction.
 Each party must have the legal capacity to
make a contract
 The parties must have exercised their own free
will, without force or coercion/pressure.

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  A contract comes into existence when an offer
has been unconditionally accepted. In
construction the offer is the “tender’, “estimate”
or “bid” and suppliers and sub-contractors
sometimes refer to their offers as “quotations”.
 The term “estimate” could be used in a wider
context to mean a guide to how much
something will cost. This ambiguity should be
avoided wherever possible.
 A contractor expects to receive an acceptance
in clear terms from the client.
 A letter of intent is often used to let a contractor
know that he should prepare to start work.

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