Why is a contract management plan important?

5 Key Elements to Include in a Construction Contract Agreement

We know that a construction agreement is usually chalked out so that the integrity of the project lifecycle is maintained by all parties. And when we talk about integrity, many aspects come into play that determines the successful completion of the project. 

Let us find out the key elements or components that foster success in construction projects. Remember, these elements are the most crucial wordings that you must incorporate into a contract agreement for construction work. 

Why is a contract management plan important?

First and foremost, you can call the contract management agreement or the plan a tool that can come to the rescue of both the contractor and the client. It not just saves your time, energy, and effort, but it ensures peace of mind for both parties. 

What is the essence of a contract agreement for construction work?

The contract will invariably establish and define the obligations and responsibilities of the parties involved. For instance, the contract will envisage aspects related to-

  • Accountability of the client and contractor
  • Well-defined duration for the completion of the work
  • Quality of the work that is expected of the contractor
  • Handling of compensation if any
  • Pre-determined mode of resolving disputes.

Since we are aware of the finer aspects that govern the construction sector, we take utmost care in drafting the contract management plan. Let us delve deeper into what you can expect in the agreement. 

What are the main components of a construction contract agreement?

Although, in any construction project lifecycle, there are many factors that you must consider, the main ones can be listed as follows-

  • The scope of construction work must be well-defined

For any construction work, the term “scope” is generalized but vast. It describes the roles and responsibilities of every single professional involved in the project. The contract for construction work must define quality, schedule, materials to be used, and any aspect that is relevant to the project. 

  • Duration of the project

While negotiating on the time frame, if the client desires a shorter time frame, the contractor must speak up and decide whether it is feasible or not. Both parties must agree upon a pre-decided date that is realistic. 

  • Clauses that will help in settling disputes

Regardless of whether the project is a small or a big one, there might be instances when conflicts might arise. In the event of any breach of the terms and conditions mentioned in the contract, appropriate action can be taken by either of the parties. 

  • Cost and terms of payment

The amount, norms governing the payment schedule, and terms and conditions that are included in the contract management plan must be succinct and clear. 

  • Accommodating modifications

In most instances, you will find that due to unforeseen conditions, you might have to tweak certain terms in the contract agreement. As such, the same must also be clarified in the plan. If and how the modifications must be incorporated depending on the prevailing or modified circumstances. 

In a nutshell, we will ensure that at no point in time, you will be subjected to any cumbersome procedures and hassles. To ensure that you get the optimum out of your contract management plan, you can approach us at ContractSquare. For more information on how we may offer our assistance to you in contract management and agreement, you can reach us at enquiries@contractsquare.co or call +91 9903023893.

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