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Updates | technicalThe Use of Contracts inBuilding and ConstructionTypes of Contracts (Part 2)By Kim BlackberryFollowing on from Part 1 of the article published in the last edition of Master Builder we will look at the standardtypes of contracts available, what a good contract should have in it, a checklist for you to use when examiningany contract and a flowchart of what contract to use when.With the development of MBA Services MBT can now work with you to develop a suite of contracts and guidesspecifically tailored for you business and badged accordingly. If you wish to know more about these servicesplease contact your local MBA office.MBT offers the following standardcontracts:• ABIC• Simple works Housing (Principal versionalso)• Simple works Commercial (Principalversion also)• Major works Housing (Principal versionalso)• Major works Commercial (Principal versionalso)• Early works Housing• Early works Commercial• Subcontract Agreement• MBT• Domestic Building Contract (FormerlyBO4)• Cost Plus• Minor Works• PB1• Variation• Offer/Agreement• Quotation/Agreement• Specification• Deacon2 Lump Sum• Deacon2 Subcontract• CM2• Multi/Single use Subcontractor• TC 2007 Trade Contract• IC 2007 Agreement• PTC 2009 Period Table Contract• PTC 2009 Work Orders and Quotation Pads• SMOM and Technical Q&A• Australian Standards• AS 2124 General Conditions• AS2124N – Notes• AS 2545 Subcontractors• AS4000 General Conditions• AS4901 SubcontractorsAs can be seen the range of contracts is extensive and there aremany other contracts published by various companies, associationsand Government agencies.The first thing to understand is what needs to be in a contract. Thecontract is the written intention of the parties clearly stating thebargain negotiated.A contract can be broken down into the following parts:• Scope of work – What is to be delivered• Schedule – Time for performance• Terms of Payment – what and how you are to be paid• Assurances of Performance – What each party is to do.• Insurance – to protect the parties from loss• Indemnity – clarification of liabilities• Changes – how the contract many be varied• Disputes – how disputes are to be resolved• Warranty – Quality of work• Termination and Suspension – Ending the contract• Assignment – power to assign contract• Venue and Applicable law – jurisdiction the contract falls intoAll contracts you deal with should contain clauses dealing with theabove items. If a contract does not contain all of the above seekfurther advice before signing.Contracts may be classified in many ways but for simplicity sakethe easiest starting point is major and minor works. Major workscontracts are for large expensive projects generally over $100,000. Aminor work is generally below that amount.Secondly, is the project being supervised by an architect? If so thenthe contract will need to have provisions detailing this. This is whereyou would likely use an ABIC contract. If not using a supervisingarchitect then you can use a MBA standard contract.Is the work for a project you have control of where you want to usesubcontractors? If so then you will use either a MBA standard singleor multiuse subcontractor’s contract.Thirdly is the work prior to a client committing to a build thenyou would look at using a pre-contract or preliminary agreement.Following is a table outlining the use of certain ABIC contracts.14 | master builders tasmania