Back-to-back agreements between main contractors and subcontractors are increasingly common on construction projects as a way for main contractors to pass obligations and liabilities down the chain. However, inadequate drafting of these agreements can lead to complex disputes. This document discusses why back-to-back contracts are often contentious, focusing on key drafting issues that need to be addressed carefully to minimize disputes between contractors. Simply stating that a subcontract is "back to back" with the main contract and requires the subcontractor to comply with all its terms can be disastrous if not drafted properly.
Back-to-back agreements between main contractors and subcontractors are increasingly common on construction projects as a way for main contractors to pass obligations and liabilities down the chain. However, inadequate drafting of these agreements can lead to complex disputes. This document discusses why back-to-back contracts are often contentious, focusing on key drafting issues that need to be addressed carefully to minimize disputes between contractors. Simply stating that a subcontract is "back to back" with the main contract and requires the subcontractor to comply with all its terms can be disastrous if not drafted properly.
Back-to-back agreements between main contractors and subcontractors are increasingly common on construction projects as a way for main contractors to pass obligations and liabilities down the chain. However, inadequate drafting of these agreements can lead to complex disputes. This document discusses why back-to-back contracts are often contentious, focusing on key drafting issues that need to be addressed carefully to minimize disputes between contractors. Simply stating that a subcontract is "back to back" with the main contract and requires the subcontractor to comply with all its terms can be disastrous if not drafted properly.
It is important that the contract between the main contractor and the customer and
between the main contractor and subcontractors are back to back
Back-to-back agreements, by which a main contractor seeks to pass its obligations and liabilities towards the employer through to its subcontractor(s), are becoming an increasingly common feature of construction projects. While they can be a convenient means of transferring risks and obligations down the chain of responsibility, inadequate drafting can give rise to disputes which are particularly complex and difficult to resolve. In this newsletter we discuss the key reasons why back-to-back contracts can be particularly contentious and the main drafting issues that need to be considered and addressed in order to minimize the risk of disputes. The back to back subcontract Another common but potentially disastrous approach to subcontract drafting is to stipulate that the subcontract is back to back with the main contract and the subcontractor is required to comply with all relevant obligations of the main contract. Commonly, this brief form of subcontract will include a copy of the main contract.