PARTIES INVOLVED IN A CONTRACT

There are broadly two types of standard form of contracts which can be used as a guide and
make agreed changes for specifics and requirement for both parties instead of drafting a
contract ab initio; for building and civil engineering contracts.
The Parties involved in a construction contract are typically two
i) The client (Natural or juristic person) ii)
The contractor
The above two have their teams and if provided in the contract an Adjudicator or Arbitrator.
But for this assignment the focus is on the client party and the contractor party their duties
and rights.
For building contracts;
DUTIES OF THE CLIENT
PAYMENT: The client is the owner of the construction project. The onus of funding the
project is on the client.
 Payment of the professional advisers (Architect, Quantity Surveyor, Project manager) fee
on his team.
 Payment for the building plans designed by the Architect.
 Payment of the materials and services, as described in the detailed bill of quantities given
by the Quantity Surveyor (materials such as amount of timber, concrete (precast or
insitu), paint and roofing sheets).  Payment of retention fee.
RIGHTS OF THE CLIENT
It is within the client right after payment is made to demand:
 A design which is skilful and effective to meet his requirements, including ease of
maintenance, durable materials and at a reasonable cost.
 Efficient supervision to ensure that the works as carried out conform in detail to the
design and the specification.
 Professional administration of the contract so as to avoid cost overruns and achieve
economical completion of the project.
 The client can repudiate the professional appointment on the ground of a total failure of
consideration.
DUTIES OF THE ARCHITECT
DESIGN: As the designer, the Architect is responsible for ensuring the design he prepares
includes adequate regard to the need of the client and should be aware it will be used for the
purpose of construction work.
 To avoid foreseeable risks to the health and safety of the construction work and workers;
he should give realistic designs that can be accomplished with known construction
methods and indicating durable materials in his design.

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  To cooperate with the planning supervisor and with any other designer to enable each of
them to comply with the requirements and prohibitions placed upon them in relation to
the project (in the case of a team of designers).
 To ensure the main contractor recommended is capable to carry out the work as designed
in the contract.
 In general the Architect have a duty of care to the client and his interests. He is to ensure
the designs are available at reasonable time.
RIGHTS OF THE ARCHITECT
 It’s within the Architect right to request relative free hand and imagination in his designs.
As long as it does not collide with the client’s interest.
 He can subject works and materials of the construction built by the contractor to scrutiny
(if there is a deviation from the original building plan or as a supervisor).
 If given the right, the Architect can recommend the main contractor to be used in the
contract.
DUTIES OF THE QUANTITY SURVEYOR
DRAFTING BILL OF QUANTITIES: As the cost manager, the Quantity Surveyor is
responsible for delivering a detailed statement of the work, materials, prices, dimensions and
other details for the construction of the work. The statement is known as Bill of quantities.
 In the absence of contract drawing or specifications, the bills drafted by the Quantity
Surveyor most contain a detailed and clear description of all the work necessary to
achieve the desired result.
 It is the Quantity Surveyor duty to be observant for any glaring defects in the building
construction and the client gets quality for his work.
 He must provide a bill consistent with the Architect’s building drawings and
specifications, he should be able to work with other documents provided by other
professionals in his team
 He certifies payments (daily, monthly, yearly) of work done by the main contractor on
behalf of the client.
 The Quantity Surveyor owe his client a duty of care. In the absence of any expressed
instruction to the contrary, the Quantity Surveyor will assume the employer is looking for
a forecast of the likely cost of the project, and not an estimate based on current price.
RIGHTS OF THE QUANTITY SURVEYOR
 It is within Quantity Surveyor rights to contact the client or his primary representative on
defective construction on site when he comes for valuation.
 The Quantity Surveyor is entitled to be left undisturbed in carrying out his bill of
quantities and descriptions as long it does not affect the client’s desire.
 It is within the Quantity Surveyor right to less reduction money from the final account
where defects are formed in the building.
DUTIES OF THE PROJECT MANAGER
MANAGEMENT: The project manager is expected to plan, motivate, coordinate and organise
the teams in the contract on behalf of the client. He ensures there is effective communication

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between the professional advisers, main contractors and sub-contractors. The project manager
duties reflects on his professional background (Architect or Quantity Surveyor).
 As the primary representative of the client his duty is to inform his client of the project
status and setback.
 He monitors the performance of the main contractor and the progress of the works as well
as monitor the performance of other consultants.
 To provide a focused discipline and structure for the team project management structure
and other participant roles and responsibilities.
RIGHTS OF THE PROJECT MANAGER
 He is entitled to visit the site without any prior notification to the main contractor
 He can employ external consultants on behalf of the employer for specials cases to grade
the performance of the contractor.
 The project manager can demand for halt of the work where he see a deviation or
variation from the building drawings and specifications.
 He is within his rights to recommend the main contractor or nominated sub-contractor as
primary representative of the client.
On the contractor side;
DUTIES OF THE MAIN CONTRACTOR
Usually in construction contracts, the main contractor will be responsible for the entire
project. He or she will take responsibility for the safety of his or her employees and, most of
the time, the subcontractors.
 The main contractor has the obligation to complete the works within the time allocated in
the contract agreement.
 The main contractor will in some instances be required to acquire insurance for the
works, site, its employees, materials, etc. This is to ensure that risk remains mitigated at
all times.

 The main contractor has to ensure that the required licences, permits and the like are
obtained before, during and after the construction works proceed. It is imperative for the
contractor to obtain all licences within the time periods allocated in order to avoid
situations where these issues lead to a delay in the construction process and therefore a
delay in the works.

 The main contractor has an obligation to respond to all communications from the
employer or his or her representative at all times during the subsistence of the works.
These might be variations, progress updates, suspension of works, access to site issues,
delayed payment notices, etc.

 In the Instance where the contract agreement makes provision for a claim mechanism,
unless otherwise stated in the contract agreement, the contractor must substantiate such a
claim in order to ensure swift settlement of such a payment.

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  Main contractors should ensure that written agreements are entered into between
themselves and the subcontractors. This is to ensure that they are able to properly hold
such subcontractors liable should any issue arise.

RIGHTS OF THE MAIN CONTRACTOR

 The main contractor is entitled to be paid within the time stated in the contract, failing
which he or she should usually be able to claim interest on late payment.

 The main contractor can claim for an extension of time for completion in accordance with
the instances catered for in the contract. The usual test is whether or not the particular act/
incident that will delay time for completion is within his or her control or not.
 The main contractor has a right to access to the site at which the works are to be
completed at the time stated and agreed in the contract agreement.

 The main contractor usually has the right to terminate the contract should a material
breach or a force majeure event occur.

 The main contractor usually has the right to appoint subcontractors if not otherwise
provided for in the contract.

For Civil Engineering contract;

DUTIES OF THE CLIENT
PAYMENT: The client is the owner of the construction project. The duty of paying for the
cost of the project is on the client. For Civil Engineering contracts because of the size and
budget of the project the client is usually a juristic person.
 Payment for services and documents provided by the Engineer (documents such as the
project design, specifications and bill of quantities; services such as project managing,
valuation of work).
 Disbursement of funds for the payment of materials to be used for construction by the
main contractor.
RIGHTS OF THE CLIENT
It is within the client right after payment is made to demand:
 A design which is skilful and effective to meet requirements, including ease of
maintenance, durable materials and at a reasonable cost.
 Efficient supervision to ensure that the works as carried out conform in detail to the
design and the specification.
 Professional administration of the contract so as to avoid cost overruns and achieve
economical completion of the project.

DUTIES OF THE ENGINEER

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 In pozzolanic Lytag V Brian Hobson Associate (1998) it was held that a Civil Engineer
appointed as a Project manager had a duty to ensure that all insurances required of the
contractor were in place to overcome unforeseen ground conditions should these be
encountered.
 It is the Engineer’s duty to check that the specified materials issued in the Bill of Quantity
(BOQ) are used by the contractor as clearly stated.
 The engineer duty is to his client and therefore he needs to ensure that there is no
ambiguity in the contract documents, all intentions from both parties must be formally
written in clear terms
 The Engineer undertakes the design of the permanent works, unless expressly stated
otherwise.
 The Engineer is required to keep records of facts relating to any claims made by the
contractor and deciding the amount, of extra payments if any as a result.

RIGHTS OF THE ENGINEER

 The Engineer is empowered to order suspensions for the whole or part of the works if he
considers it necessary.
 The Engineer can subject the materials and workmanship of the contractor to tests on or
off the site.
 The Engineer can demand for payment from the client for duties performed for the client.
 As project manager he is entitled to visit the site without any prior notification to the
main contractor.
On the contractor side;
DUTIES OF THE MAIN CONTRACTOR
Usually in construction contracts, the main contractor will be responsible for the entire
project. He or she will take responsibility for the safety of his or her employees and, most of
the time, the subcontractors.
 The main contractor has the obligation to complete the works within the time allocated in
the contract agreement.

 In some instances, especially where the contract is a design-build or EPC (Engineer,

Procure and Construct), the main contractor will be required to provide performance
guarantees. This is a mitigation of risk strategy on the part of the employer to ensure that
if the works are not performed to the correct standard or specifications, he or she will be
covered accordingly. This will usually be priced in by the contractor.

 The main contractor will in some instances be required to acquire insurance for the
works, site, its employees, materials, etc. This is to ensure that risk remains mitigated at
all times.

 The main contractor has to ensure that the required licences, permits and the like are
obtained before, during and after the construction works proceed. It is imperative for
the contractor to obtain all licences within the time periods allocated in order to avoid
situations where these issues lead to a delay in the construction process and therefore a
delay in the works.

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  The main contractor has an obligation to respond to all communications from the
employer or his or her representative at all times during the subsistence of the works.
These might be variations, progress updates, suspension of works, access to site issues,
delayed payment notices, etc.

 In the Instance where the contract agreement makes provision for a claim mechanism,
unless otherwise stated in the contract agreement, the contractor must substantiate such a
claim in order to ensure swift settlement of such a payment.

 Main contractors should ensure that written agreements are entered into between
themselves and the subcontractors. This is to ensure that they are able to properly hold
such subcontractors liable should any issue arise.
RIGHTS OF THE MAIN CONTRACTOR
 The main contractor is entitled to be paid within the time stated in the contract, failing
which he or she should usually be able to claim interest on late payment.

 The main contractor can claim for an extension of time for completion in accordance with
the instances catered for in the contract. The usual test is whether or not the particular act/
incident that will delay time for completion is within his or her control or not.
 The main contractor has a right to access to the site at which the works are to be
completed at the time stated and agreed in the contract agreement.

 The main contractor usually has the right to terminate the contract should a material
breach or a force majeure event occur.

 The main contractor usually has the right to appoint subcontractors if not otherwise
provided for in the contract.

INTER-RELATIONSHIP BETWEEN CONSULTANTS AND

CONTRACTOR
-A construction consultant is someone who helps oversee construction projects. A business or
individual may hire a construction consultant as a project management resource. Others also
hire construction consultants to help reduce costs or building times.

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-A general contractor, main contractor or prime contractor is responsible for the day-to-day
oversight of a construction site, management of vendors and trades, and the communication
of information to all involved parties throughout the course of a building project.
To describe and clarify the relationship between consultant and contractor which is required
and crucial during the project execution.
This relationship is clarified in most of the contracts where the communication between two
parties is deemed imperative to run the project effectively.
Various consultants play crucial role in the construction projects, which could be Design
and/or supervision or both. Consultants are the professionals providing expert advice in each
area of the construction and have superior knowledge of his profession.
To describe and elaborate on supervision consultant role here. This role is very clear, since
the design is presumably approved or existing and they have to supervise only the
construction works and look after the quality aspect. However the contractor must appreciate
the consultant role, since any deviation to design may cause a delay, rework due to corrective
actions and cost impacts and will eventually put the project at risk. Therefore it is usually
consultant, who points out such deviations to be corrected at site avoiding aforementioned
issues. The experience of consultant is of pertinence, since most of the consultant are more or
less 10 to 15 years experienced and can provide expert advice all time during the construction
phase.
On the other hand, a Contractor is a self employed independent construction professional who
agrees (contracts) to do work for a client typically for a fixed price. The client hiring the
contractor defines the desired results and the schedule. The contractor may supply labor only
or labor and supplies. The Contractor generally retains control over the construction to be
carried out including the methods to be used in construction, the scheduling of the underlying
work, and determine how realistically the work will get done within the standards and
duration of time given. A contractor may use his own machinery and work equipment and/or
may employ others to do the work for them.
Therefore, to my opinion the contractor must establish a partnering character, build a strong
relationship with consultant during the project execution and listen to them with building a
trust to enable the project a success. This is imperative so as to meet the project completion
deadline with quality not to be compromised and make such integrated efforts and
contribution by both parties making a project win-win. Moreover effective communications,
healthy relationship and daily discussions are positive signs of project progression. The site
and meeting discussions, email and letter communication from the consultant shall be taken
as advice and not a criticism so as to make the design constructible without any flaws.
Consultants role is to evaluate a client's needs and provide expert advice and opinion on what
needs to be done while the Contractors role is generally to evaluate the client's needs and
actually perform the work. Their relationship is bonded by their duty to the client’s needs in
the contract.
However, the roles of the Contractor and Consultant, have become blurred over the years and
at times have been used interchangeably. Especially when the Consultant, after having given
his or her professional opinion or advice on what has to be done, then enters into an
agreement (contract) to provide the services required. At that point the Consultant may be

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said to become a Contractor. The terms have also become blurred as industry has
incorporated them into employee job titles.

COMMUNICATION NETWORK IN A CONTRACT

CLIENT

PROJECT
MANAGER

NOMINATED
MAIN
SUBCONTRACTOR
CONTRACTOR
CONSULTANTS

DOMESTIC
MANUAL LABOUR
SUBCONTRACTOR

The communication according to this organogram begins with the client employing a project
manager whom will represent him on site, manage and supervise the consultants and
contractors, give reports on the progress of the construction to him. The project manager can
suggest competent consultants and nominated subcontractors if the client don’t have any in
particular. The consultants relay any complaint to the project manager in terms of restriction
to design and bill, issues of delayed payment, defects detected in the building which he
informs the client. The main contractor submits his monthly payment for certification to the
project manager and is expected to be in close communication with the project manager to
ensure what was ordered is what is being delivered, the main contractor is responsible for his
manual labour and domestic subcontractors, the defect in workmanship and poor
performance. The nominated subcontractor if selected by the client, he can communicated
with him directly bypassing the main contractor and project manager, he can decide to change
the agreed design if sought out approval from the client is granted.

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 CLIENT

ENGINEER

NOMINATED
SUBCONTRACTOR

ENGINEER'S TEAM MAIN

CONTRACTOR

DOMESTIC
SUBCONTRACTOR

The client employs a competent Engineer who due to the complexity of Civil Engineering
projects oversees and is primarily the client representative, the Engineer appoints a group of
fellow engineers which will aid him in bringing the project to realisation the team will check
and report any oversight may have occurred pre-construction or construction phase the team
answers to the Engineer, the main contractor communicates with the engineer and informs him
of the progress on site, setbacks experienced. The domestic subcontractor answers to the main
contractor. The nominated subcontractor can decide to speak to the main contractor, engineer
or client.

THE RELATIONSHIP BETWEEN MAIN CONTRACTOR AND

NOMINATED SUBCONTRACTOR
Main contracts commonly provide for certain subcontractors to be chosen by the client to
carry out particular work, usually identified as "prime cost" work to which the main
contractor will be entitled to add his profit margin and attendance costs (such as material
handling, scaffolding and rubbish clearance etc). They are usually called "nominated"
subcontractors.
Frequently, the scope of work, terms and price of the services to be provided by the
nominated subcontractor are pre-negotiated by the client and, as such, are imposed on the
main contractor. However, there is no direct contractual relationship between the client and

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the subcontractor. Sometimes the client will have signed an agreement with the nominated
subcontractor which is transferred to the main contractor. Or the client may simply oblige the
contractor to use a particular subcontractor to execute particular works.
Why nominate in advance?
nominated subcontractors or suppliers were selected by the client prior to the appointment of
the main contractor for a number of reasons, such as where the works involve items with a
long delivery time, where design and manufacturing times cannot wait for the main
contractor to be appointed (e.g. specialist plant), or where the client has based part of its
design on the services provided by the specialist contractor (e.g. a cladding system).
Nominating in advance also allows the client to secure a favourable price, which will benefit
the client, as the main contractor is usually only entitled to charge the agreed prime cost, plus
a profit mark up and attendance costs.
The main contractor's liability
English law is clear that a main contractor is liable to the client for any default by his
domestic/named subcontractors in performing the main contract work, subject of course to
any term in the main contract saying otherwise. This is the case whether the subcontractor is
'domestic' (i.e. freely chosen by the main contractor), or 'named' (i.e. chosen from a list of
candidates prepared by the client). There is nothing controversial in that arrangement because
it reflects the fact that the main contractor is merely securing through others the performance
of his own obligations under the main contract. However, the legal position with nominated
subcontractors is less straightforward. The fact of and the circumstances surrounding
nomination of a subcontractor and the words used in the main contract can sometimes result
in the main contractor not being liable for the nominated subcontractor's defaults. Much will
depend on what the main contractor has agreed with the client in the main contract. The terms
of the main contract should be the starting point of any analysis. This cannot be stressed
enough. Any provisions describing the responsibility of the main contractor for the defaults of
any nominated subcontractor will obviously be relevant. Also relevant to the analysis will be
whether the main contractor has assumed responsibility for the overall design of the works.

Case law
There is a reasonable amount of English case law on nominated subcontractors and the main
contractor's liability for their defaults. However it should be approached with caution. Much
of the case law amounts to a somewhat pedantic analysis of the meaning of words used in the
older standard form construction contracts. It will therefore be of limited assistance to
someone trying to interpret the meaning of a main contract where those words are not
present. However, from the case law and leading construction law texts we know that, unless
the terms of the main contract or the surrounding circumstances indicate a contrary intention:
Nomination: Where the main contract provides the client with a right to nominate, English
law will imply a term into the main contract that: the nomination will be done by the client in
good time so as to enable the main contractor to carry out its obligations as to time and to
work economically and expeditiously and the client or their consultant will nominate a
supplier or consultant willing to enter into a subcontract in a form consistent with the

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obligations of the main contract.2 In other words, the main contractor cannot be compelled to
enter into a subcontract which does not adequately protect its rights against the subcontractor.
Materials: The main contractor will be liable to the client for latent defects in materials or
goods supplied by nominated suppliers or used by nominated subcontractors because English
law will imply into the main contract a term that the materials or goods to be supplied by the
nominated subcontractor will be of good quality. However, such an implied term may be
excluded in circumstances where subcontract terms imposed on the main contractor limit the
contractor's right of recourse against the subcontractor for such defects.
Fitness for purpose: The main contractor will not be liable to the client where the materials or
goods selected are of good quality but are not fit for their intended purpose. A client who
directs the main contractor to use a nominated subcontractor or supplier cannot be said to be
relying on the main contractor’s skill and judgment in selecting the materials or goods to be
supplied and in those circumstances the term will not be implied.
Design: Where a main contractor accepts design obligations in the main contract in respect of
the works to be performed by the nominated subcontractor, they will be liable to the client for
the nominated subcontractor's negligent design. Where the main contract documents do not
include any obligation on the part of the main contractor to perform any design works at all, a
main contractor will not acquire design liability merely because they are instructed to enter
into a subcontract with a nominated subcontractor who is going to do some design work on
behalf of the client. In those circumstances, the main contractor's liability if any, for design by
a nominated subcontractor would only arise as an implied term of the main contract. Whether
a judge or arbitrator would find it necessary to imply such a term into the main contract will
depend on the facts and circumstances of each case.

Replacement: If a nominated subcontractor becomes insolvent or refuses to complete the

subcontract work and has its contract terminated then:
The main contractor is not entitled to an extension of time for the delays caused by the
original nominated sub-contractor (either prior to termination or due to the termination).
Where the main contract terms provide that the main contract work is reserved exclusively for
the performance by the nominated subcontractor, who subsequently goes into insolvency and
refuses to complete the subcontract work, the main contractor may have no right or duty to
carry out that work for the client, and may be entitled to additional payment in the event that
they are instructed to complete that work. The main contractor may object to the nomination
of a replacement sub-contractor if the date for completion of that replacement subcontract is
later than the main contract date for completion, or the main contractor may insist upon an
extension of time for that extended period.8
Managing the risk
Most of the standard form contracts expressly provide that the main contractor is strictly
liable for its subcontractors, including any nominated subcontractors. For example, all of the
FIDIC forms provide in sub-clause 4.4 that the Contractor is responsible for the acts or
defaults of any subcontractors as if they were the acts or defaults of the contractor. This has
two consequences:

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First, the main contractor assumes strict liability for all subcontractors, including any
nominated subcontractors selected by or on behalf of the client; and
Second, the assumption of liability prevents the main contractor from making any claim (for
example, for an extension of time or additional cost) arising out of an act or omission of its
subcontractors. In these circumstances a prudent contractor will carry out the following:
They will inform themselves of the liabilities that they are taking on. Accordingly, before
accepting the client's nomination, the main contractor should review the client's nomination
and investigate its performance, its previous history of building to programme and its
financial standing. It may also investigate the viability of the contract price with the
nominated subcontractor to gauge whether the tendered work can actually be carried out
profitably. The terms under which the subcontractor is to perform the works should also be
reviewed very carefully to check that they allow the main contractor to meet its obligations
under the main contract
If they are not happy, object to the nomination. All of the FIDIC contracts state that the
contractor is not under any obligation to employ a nominated subcontractor against whom the
contractor raises a reasonable objection.
Too often contractors are reluctant to object to the client's nomination, but not doing so will
waive the right to claim later that the nomination was inappropriate, or that the subcontract
terms imposed are unfair.

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