Construction Agreement Sample Clauses

Construction Agreement. Borrower and Contractor have entered into the Construction Agreement pursuant to the terms and conditions of which Contractor is to construct the Improvements. Borrower shall require Contractor to perform in accordance with the terms of the Construction Agreement and shall not amend, modify or alter the Construction Agreement without Lender's prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. Borrower shall execute, upon Lender's request, an assignment of Borrower's rights under the Construction Agreement to Lender as security for Borrower's obligations under this Agreement and the other Loan Documents and shall cause the Contractor to consent to any such assignment.
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Construction Agreement. Any promise or agreement in, or in connection with, a contract or agreement relative to the design, planning, construction, alteration, repair, or maintenance of a building, structure, highway, road, appurtenance, or appliance, including moving, demolition, and excavating connected therewith.
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Construction Agreement. The written instrument which is evidence of the agreement, contained in the Contract Documents, between Owner and a Contractor covering the Work.
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See more samples of Construction Agreement

Construction Agreement: Everything you need to know

A construction contract agreement is a document that sets out the limits and terms of operation for a construction project. It typically defines the type of construction to be done (including all required work), the cost of doing so, when to pay, and the timeline in which certain parts of the work must be completed.

A clearly constructed construction contract can save the parties involved from problems as the obligations and timeline are written within the contract.

How a Construction Contract Agreement Works

Most construction companies or contractors will have a template that they use as the basis for their construction contracts. This template will set their standard operating procedures, values, and other conditions.

Depending on the project, each agreement will be slightly different, with adjustments made to the job, costs, and more, depending on the job. However, most contractual agreements must include specific clauses to protect the parties on both sides of the agreement.

Project description: This explains what the project is about, including the most important idea or a description of the problem being considered. It can be a summary of things or a category.

Contract price: Here the contract price provided and the total amount received is detailed. Any additional additions or deductions from the contract and how it will be disbursed is also added.

Payment basis: Payment basis means the amount that will be paid to the contractor, either weekly, monthly, or milestone.

Schedule or calendar: The total number of days or how the project plan will be divided should describe calendar days or business days and may be displayed as a Gantt Chart, bar chart, CPM, or other methods.

List of documents: A list of all contract documents forms this part of the contract agreement. Drawings, exhibitions, specs, and additional scenarios may be part of this list.

Scope of construction: Scope can usually be measured and is a description of all construction activities that will form part of the project.

Conditions and construction work: Responsibilities of the owner and contractor, including who is responsible for providing documentation, details, payments, or other purchases, are set for the project to proceed on time.

Contract rules: Any legal requirements applied, including applicable laws, credit requirements, and pay damages, are specified here.

Once the contract is finalized, it must be signed by both parties before any work can begin. By signing, both parties indicate that they agree with the terms of the project. If either party violates the terms of the agreement, the contractor must set out the procedures for resolving the dispute, including legal action.

Types of Construction Contract Agreements

All contracts must:

  • Contains a description of the product or service offered
  • Be clear from both ends
  • Include clearly contracted services
  • Enter a cancellation or termination policy
  • Make financial goals clear

However, depending on the project and the contract being made, they may vary or have multiple modifications. Here are different types of construction agreements:

Express

Express construction agreement defines the purpose and scope of the contract. Under these terms, the terms and conditions of the agreement are clearly understood by each party.

Executed

An executed contract provides for a period of warranty or non-performance. Under this agreement, services are provided, but the contract protects one side when the performance of the other fails to provide a valid warranty for the wrong or incorrect installation.

Conditional

A conditional contract agreement is an agreement used when services are not provided at the time the contract is signed. It sets a date for the services to be provided if certain conditions are met.

Do I Need a Construction Contract Agreement?

The contract agreement protects both parties involved in the construction work. It defines the scope of your work, explains the terms of payment, and provides solutions to disputes.

Without a proper contract, any dispute involved in the project may be a major legal battle. This can be very expensive for both property owners and contractors.

Having a construction contract agreement protects the legal and financial stake of all participants in the construction project. The owner of a construction company or a property owner should not agree to start work without one.

Different types of pricing in construction agreements

Total amount

Also known as a traditional "fixed price" contract, this is the most common price setting for construction contracts. In a lump sum contract, the parties agree on a fixed price, depending on the contract value of the total and final design costs. Cash contracts look at all utilities, subcontractors, employees, indirect costs, profits, and more.

Benefit

  • The contractor is able to request high marks in anticipation of unexpected events
  • The contractor has a great advantage when comparing the total cost

Disadvantage:

  • The contractor carries almost all financial risks
  • Contract derecognition of total costs will reduce profits

Cost or consolidation costs: In a cost-sharing agreement, the owner reimburses the contractor for all costs incurred during construction as equipment and labor. The owner also pays the agreed benefit limit, usually the amount payable or the percentage of total costs.

Benefit:

  • Accurate accounting of high costs and general conditions
  • Used when there is a variation in the number of items or time

Disadvantage:

  • Post can go up quickly
  • The owner must guarantee the hundreds or thousands of costs claimed
  • The owner is at risk of unscrupulous contractors and fraud

Unit price: The unit price setting includes setting the price per unit. Here the contractor sets a price for each material.

Benefit:

  • Accurate measurement of high costs and standard terms
  • Used when there is a variation in the number of items or time

Disadvantage:

  • Until the project is completed, the final cost remains unknown
  • Creates an unequal bid due to the contractor's ability to raise and lower certain prices

The construction process also includes many moving parts and clearly defines which team is responsible for what role allows the process to go smoothly.

A few of the required components that can be assigned to each group include:

  • Obtaining permits - New construction and additions to existing buildings already require local approval and approval.
  • Providing building materials - Building materials can include cement, drywall, wood flooring, or paint.
  • Purchases -Purchases - Remodeling and construction often include new items such as a metal stove, a Sub-Zero refrigerator, or a beautiful new candle.
  • Pay for utilities - Sometimes, temporary services such as electricity, drinking water, and sanitation are needed for construction.

A construction contract agreement is a document that sets out the limits and terms of operation of a construction project. It is a contract between a builder and the person who hired them for a project. It protects the legal and financial stake of all participants in the construction project. A construction company owner or landowner should not start a construction project without one.

More Samples of Construction Agreement

Construction Agreement. The parties hereto have executed this Agreement by the hands of their duly authorized representatives. SIGNED AND DELIVERED in the presence of:  [Note to Finalization before Execution: Insert Legal Name of Owner] By:  [Note to Finalization before Execution: Authority stamp to be completed by the Owner] By: Name:  Title:  I have authority to bind the corporation Name:  Title:  I have authority to bind the corporation  [Note to Finalization before Execution: Insert Legal Name of Contractor] By: Name:  Title:  I have authority to bind the corporation By: Name:  Title:  I have authority to bind the corporation [Note to Finalization before RFT/Execution: If the Contractor is an individual, use the following signature block. Delete signature block not used. Consult Legal Services if needed.] SIGNED, SEALED & DELIVERED In the presence of: Witness Name SCHEDULE A INFORMATION SHEET [Note to Finalization before RFT: Complete appropriate rows in Sections A, B, C, D & E, and delete instructions in blue and all instructions in red] [Note to Finalization before Execution: Revise A.3, A.4, A.5 and A.6 with information provided after award.] The following table provides information cross-referenced in the provisions of the Agreement. All reference to GCs are located in Schedule D – General Conditions. Row Input Information Reference Description
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Construction Agreement. 6 4.5 Architect's Agreement ....................................................... 6 4.6
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Construction Agreement. A competitive environment requires both labor and management to seek the best ways to do electric and gas construction work. To meet this challenge Illinois Power management is responsible for making proper business decisions while labor is committed to making a good faith effort to compete against external and internal forces. It is agreed that the only practical way to continue construction in-house is under the terms contained in this document. It is understood all reference to systems or construction in this document only refers to Gas or Line Department employees. Construction employees will be eligible for systems overtime when: 1) no systems employees are available to respond; 2) in emergency situations; or, 3) when working with systems and the job assignment results in an overtime situation. Construction employees will not be placed on the first responders or systems callout list. It is understood that construction employees may be used to perform work normally performed by systems employees. TEMPORARY VACANCIES ON AN EXISTING CONSTRUCTION CREW Systems employees will be allowed to declare, on a yearly basis, an interest in temporary construction assignments. In April of each year all areas will post a sheet requesting volunteers from systems who will work under the terms of this agreement as described below:
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Construction Agreement. That certain Construction Agreement to be entered into by Campus Crest Construction, Inc., a Delaware corporation, and each Property Owning Subsidiary, a form of which is attached hereto as Exhibit O.
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Construction Agreement. A competitive environment requires both labor and management to seek the best ways to do electric and gas construction work. To meet this challenge Illinois Power Company management is responsible for making proper business decisions while labor is committed to making a good faith effort to compete against external and internal forces. It is agreed that the only practical way to continue construction in-house is under the terms contained in this document. It is understood all reference to systems or construction in this document only refers to Gas or Line Department employees. Construction employees will be eligible for systems overtime when: 1) no systems employees are available to respond; 2) in emergency situations; or, 3) when working with systems and the job assignment results in an overtime situation. Construction employees will not be placed on the first responders or systems callout list. It is understood that construction employees may be used to perform work normally performed by systems employees. The Company commits to using good business judgment when determining job assignments for in- house and contract construction crews. The Union will seek to resolve any issues in this regard with the Construction Oversight Committee.
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Construction Agreement. A written agreement between the Owner and a General Contractor for provision of goods, products, materials, equipment, systems, management, supervision, labor and services required to construct all or part of a Project.
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Construction Agreement. The CONTRACTOR shall and does hereby agree to indemnify, save harmless and defend the ASD from the payment of any sum or sums of money to any person whomsoever on account of claims or suits growing out of injuries to persons, including death, or damages to property, caused by the CONTRACTOR, their employees, agents or subcontractors or in any way attributable to the performance and execution of the work herein contracted for, including (but without limiting the generality of the foregoing), all claims for service, labor performed, materials furnished, provisions and suppliers, injuries to persons or damage to property, liens, garnishments, attachments, claims, suits, costs, attorney’s fees, costs of investigation and defense. It is the intention of this paragraph to hold the CONTRACTOR responsible for the payment of any and all claims, suits, or liens, of any nature character in any way attributable to or asserted against the ASD, or the ASD and the CONTRACTOR, which the ASD may be required to pay. In the event the liability of the CONTRACTOR shall arise by reason of the sole negligence of the ASD and/or the sole negligence of the ASD agents, servants or employees, then and only then, the CONTRACTOR shall not be liable under the provisions of this paragraph.
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