How To Draw Up A Contract For Construction Work

2023 Author: Douglas Hoggarth | [email protected]. Last modified: 2023-05-24 11:23

When entering into a contract with a construction company, be consistent and demanding.

Remember, you are the client. First of all, the construction company needs you, not you. However, you should not be overly touchy. Paradoxically, but the most courteous treatment you will find in firms created only to collect money, so to speak, from defrauded investors. The fact that in some company you were drunk with coffee should not be the main selection criterion. However, be prepared for the fact that any of the construction organizations will ultimately strive to ensure that the deadlines for the work are extended, and the estimate is higher than promised. After all, unfortunately, keeping our word in business is still (or is it already?) Considered bad form.

A single contract must be concluded with a clear indication of the construction time for all the work that you need.

The most important part of the contract is the estimate. Insist on getting it done in stages. All types of work performed at each stage and their cost must be detailed. Don't always rely on experience gained from doing DIY construction. It often makes sense to discuss the proposed rates with specialists, with the same employees of the consumer union. The estimate must include the cost of absolutely all building materials to the last nail and all overhead, planned, unforeseen expenses of the company. Please note that you are not deducted value added tax twice (for example, first the cost of building materials with VAT, and then VAT on everything taken together).

Don't trust and check all prices. Firms have a habit of not only inflating their own expenses, but also winding up income on the cost of work and building materials.

Bargain to the end, especially about building materials, the prices of which are not difficult to find out. Do not feel sorry for the construction organization, remember that it will never work for itself at a loss.

Provide penalties in the contract.

For violation of the construction deadlines, for other troubles for the customer, the company should be responsible. Never be sure of the decency of the builders before they have laid the last brick. Also don't rely on the very best recommendations. Everything was done to your neighbor perfectly and quickly, and to you - the law of meanness - they will be hackneyed for ages if you do not oblige them with a line of the document in advance.

Bring your firm's cost share to 25 percent. 30 percent is the maximum you can agree to.

When calculating this amount, do not forget that, according to accounting rules, expenses are charged from the entire previous amount. Here's an example: the cost of work and materials is 10 million rubles. Overhead costs - 15 percent, or 1.5 million rubles. Then 8 percent of unforeseen expenses will be calculated from 11.5 million rubles. Normal prepayment is 50 percent. At the end of each of the work ordered by you, you must pay the balance.

You should receive the signed originals of the contract, project and estimate in your hands.

If the builders have exceeded the cost estimate, this does not concern you. If they are underperforming, you have a legal right to pay less. If the company has entered into an agreement and does not comply with it - go to court, demand damages (with the help of the same consumer union).