2.

0 CONTRACT DOCUMENTATION
A construction contract is a mutual and legally binding agreement between a building contractor
and a client based on certain policies and conditions generally recorded in documentation form in
a contract document. The roles of each party in the contract are also highlighted in the contract
document.
Key Parties involved in Contract

• Client/Employer
• Architect
• Contractor
• Subcontractor
• Engineer
• Manufacturer of Materials
• Project Financiers.
Client/Employer

The person named as the employer in the appendix to tender and the legal successor in tittle to
this person.
Contractor
Person(s) named as Contractor in the letter of Tender accepted by the employer and the legal
successor in tittle to this person(s).
Subcontractor
Any person (s) named in the contract as a subcontractor or any person appointed as a
subcontractor for a part of the works and the legal successor in tittle to each of these people
Engineer
Person appointed by the employer to act as the Engineer for the purposes of the Contract and
named in the Appendix to Tender or other person appointed from time to time by the Employer
and notified to the Contractor.
Architect
Architect is a person appointed by the client, who develops a facility as per the design concept
and the requirements specified by the client.
Project Financiers
An entity that provides funding for long-term infrastructure, industrial projects, and public
services using a non-recourse or limited recourse financial structure. Eg. Government of Kenya,
ADB, JICA, World Bank, etc

Funding could be:

• Government funding
 • Grants
• Bonds
• Public Private partnerships
Manufacturer of Materials
Material manufacturers are mainly companies that manufacture various materials/components
and employment is based on the engineer’s knowledge of the qualities, performance and uses of
the building materials.
Specification: This amplifies the information given in the contract drawings and bill of
quantities, and describes in detail the work to be executed under the contract and the nature and
quality of the materials, components and workmanship.

Bill of Quantities: This consists of a schedule of items of work to be carried out under the
contract with quantities entered against each item, prepared in accordance with the Standard
Method of Measurement of Building Works (refer to SMM7).
Contract Drawings: These depict the details and scope of the works to be executed under the
contract. They must be prepared in sufficient detail to enable the contractor to satisfactorily price
the bill of quantities.
Organization of General Building Project
Organization of General Civil Engineering Project

Roles of Client/Employer

i. Giving right of access to site to the contractor and possession of all parts of the site
within the contract period.
ii. Shall provide assistance (whenever in a position to do so) to the contractor to obtain
permits, licences, and approvals.
iii. Assistance in delivery of goods and clearance through customs.
iv. Export of contractor’s equipment when removed from site.
v. Ensuring employers personnel cooperate with the contractor.
vi. Facilitate payment to the contractor.
vii. Giving notices to the contractor regarding any claims that he feels entitled to.

Roles of Engineer
i. Shall act on behalf of the employer
ii. Approve materials and plant.
iii. Approve contractors site superintendence unless otherwise stated in the contract.
 iv. Issue instructions to the contractor.
v. Checking and review of payment certificates.
vi. Inspection and approval of completed works sections.
vii. Issuance of notices to the contractor.
viii. Request for any relevant tests for materials used for works as he/she deems fit.
ix. Provision of and modification of drawings.
General roles include;

• Feasibility studies- to check the viability of the proposed project in technical,

environmental, financial, economic, etc
• Advice on the project procurement procedures i.e. conditions of contract, mode of
procurement e.g. traditional, design build
• Prepare tender documents i.e. design drawings, bills of quantities, estimates
• Evaluation of tenders i.e. bid analysis
• Appointment as resident engineers for various projects
• Supervision of implementation of projects, development control.
• Processing claims and certificates i.e. vetting the before certification and payment,
preparation of final accounts
• Supervision of consultants employed on other projects including approving their
drawings Environmental management
• Administration duties
• Manage projects i.e. budgets, etc
Limitations of Engineers responsibility
Has no authority to relieve any party of their duties, obligations, or responsibilities.
Roles of Contractor
i. Execute and complete works as per the contract.
ii. Remedy any defects of work
iii. Design to the extent specified in the contract in design build contracts.
iv. Provide plant
v. Provide documents required in the contract e.g Programme of works, Cash flow
estimates, work methodology, Environment management plan etc.
vi. Provide contractors personnel that shall be responsible in executing the project.
vii. Temporary works e.g provision of diversions to traffic.
viii. Ensuring safety for all site operations.
ix. Submission of as built documents and operation and maintenance manual to the
Engineer.
x. Provide the employer with performance security at his cost as a gurantee for proper
performance in the amount and currency stated in the contract (Appendix to tender)
 xi. Ensuring performance security is valid and enforceable until the contractor has executed
and completed the works.
xii. Appointing a contractors representative who shall have authority to to act on the
contractors behalf.
xiii. Be responsible for the acts of subcontractors.
xiv. Setting out of works in relation to original points, lines and levels.
xv. Comply with applicable safety regulations
xvi. Provide fencing where applicable, lighting, guarding etc until works are complete.
xvii. Institute quality assurance systems to demonstrate compliance with the contract
requirements.
xviii. Protection of the environment.
xix. Preparation and submission of monthly progress reports unless otherwise stated in the
contract.
Limitations

Contractor shall make no alterations in design, scope, or methodology without notifying the
Engineer
Roles of Nominated Subcontractors
Nominated subcontractor is a subcontractor whom the contractor has been instructed by the
engineer to employ as a subcontractor.

• Roles similar to the contractor except that they don’t report directly to the employer and
have specified works which is a portion of the contractor’s scope.
Roles of Material Manufacturers
i. Research and development on ways to improve the material in view of the conditions or
to come up with other uses of the materials in order to increase the market.
ii. Testing of the material-this will be to guarantee the quality of the material and to ensure
that it meets the local and international standard.
iii. Supply to contractors.

Roles of Architect

i. Assisting the client to prepare a strategic brief.

ii. Carrying out feasibility studies and options appraisals.
iii. Advising on the need to appoint other professionals to the consultant team, independent
client advisers, specialist designers and specialist contractors.
iv. Advising on the procurement route.
v. Contributing to the preparation of a project brief.
vi. Preparing the concept design.
 vii. Preparing the detailed design.
viii. Preparing planning applications.
ix. Preparing applications for statutory approvals.
x. Preparing production information.
xi. Preparing tender documentation.
xii. Contributing to the assessment of tenders.
xiii. Reviewing designs prepared by others.
xiv. Acting as contract administrator.
xv. Inspecting the works.
xvi. Advising on the rectification of defects
xvii. Provide counseling service(s) to clients.
xviii. Planning and developing design for client.
xix. Provision of technological know-how advice.
xx. Help select suitable contractors to execute construction work.
xxi. Help to ascertain the cost estimation or budget for the construction
xxii. Help clients to obtain a permit from the government
xxiii. Supervisory role

Roles of Site engineer

Primarily deployed on site to:
i. Manage the job i.e. plant management, supervision of works under execution,
planning/organizing/co-ordination of work, hiring of workmen
ii. Represent the contractor at the site
iii. Site administrations - letters, control site offices
iv. Site management i.e. site planning, labour management, material management, control of
stores, petty cash management, site accommodation management
v. Design of works to be done by the contractor
vi. Procurement of materials, component, tools etc
vii. Measurement of work in progress
viii. Costing of the work under execution
ix. Preparation of the interim and final statements of claim
x. Preparation and justification and contractual claims
 xi. Preparation and attendance of site meetings
xii. Keep the head office informed on the progress of the job on site
xiii. Manage project budgets
3.0 DELAYS AND SUSPENSION
Works are expected to be complete within the stated contract period. However, some delays may
occur that warranty claims.
Situations which may lead to contractor raising a claim
Claim can be

• Extension of time (EOT) for work delays caused by the employer or his representative
• Financial claim (Payment of cost incurred plus reasonable profit)
Failure of the employer to give the contractor possession of site within the stipulated time in the
contract. eg. 14 dyas after order to commence.
Delay or cost implications due to errors that arise as a fault of the employer and an experienced
contractor could not possibly have discovered such error.
Cause of delays that warranty EOT
i. Variation—Change of quantity of an item of work.
ii. Adverse climatic conditions
iii. Unforeseeable shortages in availability of personnel or material caused by epidemic or
government actions.
iv. Any delay attributable to the employers such as
• Failure of the employer to give the contractor possession of site within the
stipulated time in the contract. eg. 14 dyas after order to commence.
• Delay or cost implications due to errors that arise as a fault of the employer and
an experienced contractor could not possibly have discovered such error.
• Suspension of works

Suspension of Work
The contractor or the employer can suspend works.

Engineer may suspend part or all works through a notification to the contractor.
Consequences of Suspension of works by the employer

• Extension of time due to delays caused

• Payment of cost incurred as a result of suspension.
• Payment for plant and material.
Suspension can be useful, for example, if the client has difficulty in raising funds to pay for the
work to proceed at the speed anticipated by the contract. Either party may have the right to
terminate the contract at the end of a suspension period, or if a suspension becomes prolonged
with no prospect of work re-commencing.

4.0 BREACH OF CONTRACT

If one of the parties to a contract fails to perform as required by the contract, this may constitute
a breach of contract. If the breach of contract is serious (a material breach), then the innocent
party may also consider that it is discharged from any further obligations under the contract.

Generally the contract will set out what those breaches are, but they might include:

• Refusal to carry out work.

• Abandoning the site.
• Removing plant from the site.
• Failure to make payments.
• Employing others to carry out the work against the terms of the contract.
• Failure to allow access to the site.

• Failure to proceed regularly and diligently.

• Failure to remove or rectify defective works.
• Convenience.

Contracts may allow party open to significant claims by the other party in case of breech.

Termination for convenience is only provided for in some forms of contract, and is often only
available to the client.
5.0 TERMINATION BY EMPLOYER

Employer may terminate the contractor if the contractor;

i. Abandons site
ii. Subcontracts the whole of the works without prior agreement
iii. Becomes bankrupt
iv. Gives or offers to give bribe, gift, commission, as an inducement or reward.

6.0 TERMINATION BY CONTRACTOR

Contractor may terminate contract if:

 i. If the employer fails to respond on notice to suspend works within the
timelines specified in the contract.
ii. The employer fails to issue payment certificate within the specified
timelines after receiving the statement from the contractor.
iii. If the contractor does not receive the amount due under IPC within the time
stipulated in the contract.
iv. Employer fails to substantially perform his obligations under the contract.
v. Prolonged suspension that affects the works.
vi. Employer becomes bankrupt