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Contractual Procedures And Procurement For Construction And The Built Environment Add in library

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Question:

Evaluate contractual measures to ensure compliance with standard quality requirements.
Provide an analysis of contractual arrangements used in nominated and domestic subcontractor arrangements.
Evaluate the types of contractual arrangements used with suppliers within the construction sector.

 

 

Answer:

Quality assurance is the most important aspect of any construction project. It is the most important aspect of construction and engineering industry because of the high level of risk involved in projects. The highest risk is of not completing the work on time because of the problems that occurs externally or internally while conducting the project. Performance enhancement is an important issue for any construction company for getting the best result from their project. Quality approach provides benefits to everyone involved in the industry of construction and procurement. Systematic quality in the work reduces the risk for all members involved in the project work (Anumba and Ruikar, 2008). Hence, it is important to maintain proper contractual measure to maintain the standard of quality in the work to get the best output from the project. It is known that in Saudi Arabia a huge number of construction projects have been taken under that are huge and giant in nature. It is very important for the construction companies to maintain contractual measures for maintaining the standard of quality for the project to reduce the risk that occurs while conducting the project. The construction companies mainly follow the rules as per the ISO 9001 standards that help them to follow universal standard which helps to evaluate the risk occurrence in the project (Lester and Lester, 2007). In other words it can be said that the contract must be made in such sense that it maintains the quality of the project that reduces the risk of the entire project work. The measures are as follows:

  • A construction project is a unique work that is performed by a group of people, equipments, and materials that are used for the construction must be mentioned in the contract.
  • Performance testing must not be feasible on basis of acceptance.
  • The design and construction must have separate contract.
  • The whole project cannot be rejected after completion of the project in the area of the purchaser’s land (Seel, 1984).
  • The number of parties in the construction project procurement must be more than the number of parties in the manufacturing project procurement.
  • The project cannot be rejected after the completion of the work. If any part of the work is to be rejected must be done with the decision of the group involved in the project.
  • The organization structure of the construction company must be mentioned in the contract (Ashworth, 2006).
  • The time period of the construction work must be mentioned in the contract.

Case Study

It was found in Saudi Arabia that out of 34 major companies only 15 companies where chosen in the study of the contracted construction because of the maintenance of the standards of quality in the project (Scott, 2006). The clause that is included in the ISO 9001 for maintaining the standards of quality and the ranking provided by the companies are given below in the tables:

Table 1: ISO 9001 clause

 

 clause

Table 2: Most compiled and latest compiled with ISO 9001 clauses

 

 

Contractual arrangements are the basic need to complete a major contract as per the guidelines of the contract and the construction sector. Construction sector needs major evaluation of prolific arrangements to complete a specific work (Russell and Russell, 1989). If noted specifically the arrangements totally describes and evaluates the need of a successful construction of a contract base (Ashworth, 1998). The contract base signifies the major role and responsibilities that are potentially needed in a major construction. Sub-contractors play a significant role in building up the major construction along with the main constructor and it also helps in arranging the major specifications that are potentially needed in the construction part. The use of the sub-contractors potentially enables the major and the main contractor to undertake the major and most importantly the complex projects and construction contracts without increasing the risk factor. What's more, on administration gets the works will be completed by 'works foremen's and on development administration gets the works will be done 'by profession builders', in spite of the fact that actually exchange builders are not sub-foremen as they are shrunk by the customer, and just overseen by the development director (Lenihan and Fletcher, 1978).

 

A named sub-builder is one that is chosen by the customer to complete a component of the works. Named sub-foremen are forced upon the principle builder after the primary foreman has been delegated. The component for assigning is a direction in connection to a prime expense total to which a principle foreman is qualified for include its check up and participation costs. It permits the customer to have immediate separate transactions with significant suppliers of merchandise or administrations and food their arrangement and outline data into the agreement after works by the fundamental foreman have started (Brandon and Kocatürk, 2008).

The expense expert values the work of the named sub-foreman independently and the sum due is demonstrated on between time declarations and is informed to the assigned sub-builder. The agreement may permit the customer to pay the assigned sub-builder straightforwardly if the primary foreman neglects to do so (Greenstreet, Chappell and Greenstreet, 1994).

As the foreman has no decision in the choice of the named sub-builder, they can't be considered in charge of disappointment of the assigned sub-foreman to perform. As the agreement for the named sub-foreman is with the fundamental builder, not with the customer, the customer ought to guarantee that they have an immediate guarantee with the assigned sub-foreman to ensure execution and to repay the customer if any default permits a case for misfortune and cost or expansion of time by the principle builder. For example defers by a designated cladding builder may give the primary foreman qualification to an augmentation of time (Cooke, 1984).

The contractual game plans permitting selection are exceptionally convoluted, endeavouring to cover all conceivable inevitabilities both between the customer and the primary foreman furthermore between the principle builder and the named sub-builder. This may incorporate; protests by the principle builder to the designation, bankruptcy of the selected sub-foreman, the requirement for re-selection etc. The domestic sub-contractor totally depends on the arrangements of the contractual agreements of the sub-contractor. It is because of the appointment of the work that is prolifically done by the main contractor and the sub contractor. It totally signifies the value and experience of the main and sub-contractors which helps the nominated contractor to act eventually according to the expenses and arrangements (Fox, 2000).

 

Contractual arrangement is one of the important issues of any construction process. The contractual arrangement depends on the type of work that is being carried out in the construction project. Although whichever type of contractual arrangement is adopted, the main purpose of it is to maintain the relationship between the client and the contractor (Gorringe, 2002). The contract between the contractor and the client shows the rights and responsibilities of each party regarding the completion of the project. Hence, it is important for the contractor and the client to come into a contract to maintain a quality and complete the work peacefully as per the requirement of the client. The standard contract also contains the type of practices and the work and preferences of the client that provides full information about the project work that is going to be conducted by the parties. All contracts include numbers of implications that evolves while conducting the project work. While conducting a project work a contract deals with a number of aspects that are mentioned as follows:

  • Payments: The contract includes the details about the payment between the suppliers and then Construction Company.
  • Tendering: It includes the details of the tendering that is involved in the project.
  • Insurance: The contract includes the detail about the insurance of the products supplied by the suppliers.
  • Contractual conditions: It includes details of the contractual conditions that conduct the entire contract (Gransberg and Loulakis, 2012).
  • Intentions of the parties: It provides information about the intention of the parties and the wants and needs of the parties.
  • Control of the works: The contract helps to contract the entire work and excludes the risk that may occur while conducting the project.
  • Forms of the agreements: It includes the details of the forms of agreements made between the construction company and the suppliers (Greenstreet, 1981).

Reference

Anumba, C. and Ruikar, K. (2008). E-business in construction. Chichester, UK: Wiley-Blackwell.

Ashworth, A. (1998). Civil engineering contractual procedures. Harlow, Essex, United Kingdom: Addison Wesley Longman.

Ashworth, A. (2006). Contractual procedures in the construction industry. Harlow, England: Pearson/Prentice Hall.

Brandon, P. and Kocatürk, T. (2008). Virtual futures for design, construction & procurement. Oxford: Blackwell Pub.

Cooke, B. (1984). Contract planning and contractual procedures. London: Macmillan Education.

Fox, W. (2000). Ethics and the built environment. London: Routledge.

 

Gorringe, T. (2002). A theology of the built environment. Cambridge, U.K.: Cambridge University Press.

Gransberg, D. and Loulakis, M. (2012). Expedited procurement procedures for emergency construction services. Washington, D.C.: Transportation Research Board.

Greenstreet, B. (1981). Architects' guide to legal contractual procedures. London: Architectural Press.

Greenstreet, B., Chappell, D. and Greenstreet, K. (1994). Legal and contractual procedures for architects. Oxford: Butterworth Architecture.

Lenihan, J. and Fletcher, W. (1978). The Built environment. New York: Academic Press.

Lester, A. and Lester, A. (2007). Project management, planning and control. Amsterdam: Elsevier/Butterworth-Heinemann.

Russell, T. and Russell, T. (1989). The built environment. Godstone: Gregg.

Scott, S. (2006). Best-value procurement methods for highway construction projects. Washington, DC: Transportation Research Board of the National Academies.

Seel, C. (1984). Contractual procedures for building students. London: Holt, Rinehart and Winston.

 

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