STANDARD CONTRACT FORMS

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STANDARD CONTRACT FORMS
By MOHAMMED JALALUDDIN LECTURER CONSTRUCTION
ENGINEERING MANAGEMENT DEPT
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OUTLINE

• Standard Contract Forms
• Definition What is a standard contract form ?
• Why use standard contract forms ?
• Standard Contract Forms
• AGC Associated General Contractors of America
  (AGC) Forms
• AIA American Institute of Architects (AIA)
• EJCDC Contract Forms The Engineers Joint
  Contract Document Committee

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Objectives of Class

• To define standard contract forms and why to use
  standard contract forms
• To introduce different types of standard
  contract forms produced by the professional and
  trade associations for architects (American
  Institute of Architects), engineers (Engineers
  Joint Contract Documents Committee) and
  commercial contractors (Associated General
  Contractors of America)
• To differentiate between AIA, AGC, EJCDC Contract
  forms

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Need for Contract Documents ?

• To deliver a construction project, you must
  coordinate the efforts of the owner, architect,
  and contractor in an accepted and acceptable
  contract form.

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CONTRACT DOCUMENTS

• Addenda
• The Agreement
• Conditions of the Contract
• Define the basic rights, responsibilities, and
  relationships of the parties involved in the
  construction process in greater detail than the
  agreement.
• The Drawings
• The Specifications

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Standard Contract Forms What are they ?

• Certain industry groupsi.e., AIA, AGC,
  EJCDCpublish standard form documents for all, or
  almost all, construction project delivery
  methods.
• Standard form contracts have been an essential
  part of the construction industrys business
  practices since the nineteenth century.
• They provide the rules-of-the-road for
  construction transactions
• Standard forms serve as invaluable references and
  benchmarks for the parties forms drafting and
  negotiation efforts.

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STANDARD CONTRACT FORMS

• Published by professional societies
• AIA Document A101
• Standard Form of Agreement between Owner and
  Contractor where the Basis of Payments is a
  Stipulated Sum.
• AIA Document B141
• Standard Form of Agreement Between Owner and
  Architect
• EJCDC Document 1910-8-A-1
• Standard Form of Agreement Between Owner and
  Contractor on the Basis of a Stipulated Price
• Agreement form should be included in Project
  Manual for bidding purposes.

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Standard Contract Forms Why Use it ?

• Advantages of standard agreement forms include,
  familiarity of the forms, recognized customs
  resulting from long term use, legal precedents
  interpreting the documents, and uniformity of
  terminology.
• In a competitive business environment where
  time-is- money, such as that of construction,
  reduced drafting and review time means lower
  overall transaction costs for each construction
  transaction.
• Familiarity with standard terms and conditions
  provides contractors and subcontractors with the
  necessary comfort to offer lower bids or
  negotiated prices.

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Standard Contract Forms Why Use it ?

• Drafting a multi-part construction contract from
  scratch in a short span of time is an ambitious
  and daunting undertaking for the inexperienced.
• Developed by construction law practitioners and
  construction industry experts typically over a
  period of several years after many rounds of
  receiving suggestions and feedback from
  construction industry constituents, such as
  owners, contractors, design professionals,
  specialty contractors, sureties and insurers.

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Standard Contract Forms Certain Cautions

• Construction industry standard form contracts
  should not be used without noting certain
  cautions
• Standard forms should not be used without
  modifications.
• When modifying a standard form, be wary of the
  ripple effect.
• Custom-drafted and industry-drafted forms do not
  mix.
• Every contract form, including those drafted by
  industry organizations, contains the bias of the
  drafter.
• Modifying standardized forms may be necessary to
  meet specific project requirements.
• Make certain changes are properly referenced and
  that cross referencing between the agreement and
  the Conditions of the Contract and the General
  Requirements (Division 01) are correct.

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AGC
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AGC FORMS
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AGC DESIGN -BUILD
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AGC DESIGN-BUILD
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AGC DESIGN-BUILD
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AGC CONSTRUCTION MANAGEMENT
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SUMMARY

• Advantages of standard agreement forms include,
  familiarity of the forms, recognized customs
  resulting from long term use, legal precedents
  interpreting the documents, and uniformity of
  terminology.
• Developed by construction law practitioners and
  construction industry experts typically over a
  period of several years after many rounds of
  receiving suggestions and feedback from
  construction industry constituents, such as
  owners, contractors, design professionals,
  specialty contractors, sureties and insurers.