In-depth View on the Construction Contracts

 

FEATURED PAPER

By Prof Dr. Mostafa H. Kotb, Dr. Mohamed Abo Al Anwar, Eng. Haytham Baraka

Cairo, Egypt

 


 

  1. Abstract

Construction contracts are one of the most important tools in the construction sector and vital to any project in order to be successfully delivered. This paper provides an overall view on contracts in the construction industry.

Keywords: Contract, Management, construction, standard contract, Traditional contract, choice of contract.

  1. Introduction to contracts

Construction contracts are one of the most important tools in the construction sector and vital to any project in order to be successfully delivered. The contract represents the most important document in the construction industry, and it gains this level of importance as it represents the most powerful tool to enforce any decision. It determines the authority and the obligations of each involved party. Simply, a contract represents a formalized tool of communication between at least two parties. We will not exaggerate if we said that the contact is the gate for all project management processes. Contracts define the various aspects, obligations and relations between each party that are necessary to reach a common planned goal.

 (Institution of Civil Engineers, 2016) Contracts should also establish:

  1. Who is responsible for design, construction and supporting work
  2. How risks are shared between promoter and contractor.
  3. Entitlement and any formalities relating to the use of sub-contractors.
  4. Programs of work and dates for completion, together with provisions for any agreed extensions of time if the contract specifies an expected completion date, regardless of whether or not there is a requirement for the payment of liquidated damages.
  5. Insurance arrangements.
  6. Terms of payment.
  7. Variations to the works to be carried out.
  8. Grounds for termination of the contract itself and possibly for the termination of the employment of the contractor (in which case, the contract itself will continue, with the promoter being entitled to appoint a replacement contractor to complete the works and contra-charge the original contractor for any additional costs).
  9. The settlement of disputes.

 

  1. Definition of contract

Construction contracts are normally written and not verbal. The contract is an agreement between two or more parties or persons stating the rights, duties and obligations which are enforceable by law. The contract definition has been discussed by many authors and organizations as following:

(William R. Anson, 1939) has defined the contract as ‘a legally binding agreement made between two or more parties, by which rights are acquired by one or more to acts or forbearances on the part of the other or others’. The essential elements of this definition are as follows:

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To read entire paper, click here

 

How to cite this paper: Kotb, M.H.; Al Anwar, M.A., Baraka, H. (2019). In-depth View on the Construction Contracts; PM World Journal, Vol. VIII, Issue VI, August.  Available online at https://pmworldlibrary.net/wp-content/uploads/2019/08/pmwj84-Aug2019-Kotb-Al-Anwar-Baraka-in-depth-view-on-construction-contracts.pdf

 


 

About the Authors


Prof. Dr. Mostafa H. Kotb

Cairo, Egypt

 

 

Prof. Dr. Mostafa H. Kotb is Professor of Structural Engineering in the Faculty of Engineering at AZHAR University in Egypt, since 2006. Fields of interest include behavior of design of steel structures, strengthening and repair of reinforced concrete elements for structure interactions, and rehabilitation of civil infrastructure,  He was Vice-dean from 2011 through 2015, Assistant chair of Al-AZHAR International Engineering Conference from 2000 till 2014.  For more information, visit https://www.linkedin.com/in/dr-mostafa-kotb-85ab353a/?ppe=1.  He can be contacted at Dr_mostafakotb55@yahoo.com

 


Dr. Mohamed Abo Al Anwar

Egypt

 

 

Dr. Mohamed Abo Al Anwar has a Ph.D of Structural Engineering in the Faculty of Engineering at AZHAR University in Egypt. He can be contacted at aboal.anwar@yahoo.com

 


Haytham Baraka

Cairo, Egypt

 

 

 

Eng. Haytham Baraka, B.Sc., PMP, CCP, PMI-SP, PMI-RMP, graduated from Zagazig University as a Civil Engineer, and his graduation project was construction management for the Cairo metro project. He worked in several roles of Civil Engineering (Site Engineer, Technical Office Engineer, Planning Engineer, Project Controls Manager). He is active in professional project management associations and is a certified Project Management Professional (PMP), Certified Cost Professional (CCP), Scheduling Management Professional (PMI-SP), and Risk Management Professional (PMI-RMP). For more information, visit https://www.linkedin.com/in/haytham-baraka-pmp-ccp-sp-rmp-apc-rics-candidate-765a9b28/

Mr. Baraka can be contacted at: h_baraka14@yahoo.com or  Haytham@built.com.sa