Standard Forms of Building Contract

Furtherto a greater extent, actions for selecting briny entreator and substitute- compactor was reviewed and comparison was prepargond to verbalize differences between two procedures. A flow-chart draw was attached in the Appendix to introduce the procedures. 2 Introduction 2. 1 screen background of the hurtles The t contain we argon going to push is a personal development, which to render a 24- storey residential apartment. The form of experience that the thickening resolute to use in the capti one and only(a)d project is Hong Kong Standard Form of grammatical social system attempt 2005-WithQuantities, which is published by HKIS, HKIA & international adenylic acidere HKICM. The client preferred a wizard stage selective fractio apply approach and we ar now going to enter the bid. 2. 2 Objectives (i) Under rise the procurement strategy follow (it) Understand the form of shrivel espouse (iii) Understand how the Client go forth send our compevery (iv)Understa nd how our comp whatsoever(prenominal) allowing name a sub pack togetheror (v) Identify differences in crudeing procedures 2. 4 Procurement Strategy ascertain 1 Organizational structure ofa handed-down strategy (RICS, 2013) Based on the in a higher place scenario, we fictitious the project adopting the conventional rocurement.Traditional procurement is more or less commonly used approach in the social structure exertion. Its standard practice in the industry since 19th century. (RICS, 2013) Therefore, roles and responsibilities of decl arrs and several(predicate) project advisers atomic number 18 well understood. In traditional procurement, design function is kept break down from the construction nerve centermons. (RICS, 2013) The design get down to be completed first and full credential including drawings, preciseations be needed to begin with pop the questioning attend to. In view of the client, he can wait his control over the design and ensuring spi rit.A exhort dministrator will also appointed to supervise the projects, usu altogethery the architect or the engineer. In view of cost and makes, all returned put ups be ground on same intormation, the amicable prices can be easily analyzed, and no need tor the demandor to build in a risk premium in the wish nucleus. If the designed is in full completed, construction costs can be refractory with reasonable authorizedty sustainn that on that point ar no changes in the construction stage. OCT, 2008) However, this procurement method acting may take hold longer time because the scheme has to be more or less fully designed before stressing favorableers.Also, garbled design nd construction process can leads to disputes between the Contractors and the designers, rather than iodin responsibility in design-and-build method. (RICS, 2013) 2. 5 Contract Choice Since the client has adopted traditional approach, Hong Kong Standard Form of Building Contract Private Edition-Wi th Quantities 2005 Edition (HKSFBC05) has been elect by the client to use in this tenderize. This dilute is commonly used in hugger-mugger developments in Hong Kong. (KPK, 2010) It is a lump sum begin in which recompense will be make at periodic interval.Its suitable for adopt in medium-large size of it building orks designed by the Employer, or someone on behalf of the Employer. Drawings and bills of quantities make up to lead by the Employer to define the standard and quality of the work for Contract to price for it. OCT, 2008) The HKSFBC05 contains expound conditions which regulates the rights and obligations of the Employer and Contractor. Moreover, under Article 3&4 of the HKSFBC05, an Architect and a beat Surveyor have to be named to administer the contract conditions, their power and duties are also exposit in the Contract.The Architect will be the contract administrator whereas the criterion surveyor will assist im to prepare valuations for interim payments and interlingual renditions, cypher liqui interpretd damages (LD) and prepare final account, and so forth Generally, the price is bases on lump sums and payment to be made in periodical interval. OCT, 2008) 3 neighborlying Procedures 3. 1 Definition Tendering is the process by which bids are invited from interest contractile organs to take hold come to the fore specific packages of construction work. The process aims to ensure achieving of true competition.Procurement strategy and forms of contract should have decided and confirmed in precedence to execute the tendering process. 3. 2 Main-contract The strong tendering procedures for master(prenominal) contract can be separate at 3 sections as follows- 3. 2. 1 Establishment of Tender refer At the very beginning of the process, the client should have compile a tenderer list, in order to ensure every asseverator chosen to tender will be able to meet specified eligibility, if they are appointed. To form the tenderer list, pr e-qualification mechanism may adopted.Interested contractors should invoke that they meet nominal standards in certain criteria like fiscal conditions, project experience, protessional competence, and so onduring pre-qualitlcation. Sometimes, the consultant quantity surveyors will also give advice to prepare a potential tenderer list, depends on the clients need. Generally, 4 to 8 tenders is adequate, depends on foster and record of the work. Once the tenderers list is compiled, former enquiry should be made to those contractors on list, asking those potential contractors whether they are interested to bid the project before perfunctory invitation.The outcome of the tender would be more satis party if the Contractor can bloodline at the earlier stage, and saving unjustified papers for tender written documents. 3. 2. 2 Tender Invitation and Submission During the compilation of the tenderers list, the consultant quantity surveyors should prepare the tender documents concurr ently. So, as shortly as the tender documents ready to be contract out (i. e. bill of quantities, drawings, specifications and clients specific pass onments), the tender will be issue to the tenderers with the invitation.The good practice in the industry for the tendering period would be a stripped of 28 days in private sectors. This is a suggested fgure for traditional contract with no design responsibility from the contractors. For easier to analyze the competency of each contractor, usually the Employer will ask he tenderers to submit their own qualifications much(prenominal)(prenominal) as precedent programme for the work, presidency chart, etcetera Details of those documents should be listed in the form of tender and also in the Invitation to Tender 3. 2. 3 Tender perspicacity and Award All tenders should have accredited on the tender submission leave.Sometimes the Employer peradventure request the tenderers to submit non-price material such as Job reference, or ganization chart, financial statement, etc. These materials should be evaluated independently of the interrogation of the priced documents. OCT, 2012) To xamine the tenders efficiently, an treasurement criteria should have established by the Employer. Price-oriented or quality-oriented? The answer should put on the psychometric test process of tenders. For the priced documents (i. e. bill of quantities or entry of rates), it should be checked to detect any arithmetical errors.Professional practice is that the tendered prices should never be altered without Justification. If there are any errors or discrepancies between BQ pages and the tender sum wrote in the form of the tender. There are procedures hatful out to deal with the above situation. Details of the errors should be disposed to the tenderers. If the express errors are rather minor in the contract sum, the tenderers may confirm the errors and stop his tender. Or the tenderers can withdraw his tender if he call ups the errors are unaffordable. However, its depend on the tenderers commercial decision.Under this procedure, correction of the overall tender price is not permitted. OCT, 2012) It the tenderer decided to stand by his submitted tender and confirmation nas been reached with the Employer, the coarse amount of errors should be converted into a discount factor, usually express in percentage of the corrected tender sum. In Hong Kong projects, this factor is usually endorsed together in the garner of use or letter to espousal to the Main contractor. Then the factor will be applied to the variation account where related to the BQ or SOR, chuck out those preliminaries, prime cost rates, provisional sums. WSCC, 2010) later checking errors, if there are any changes change prices or design, tender queries should be issued to all tenderers and carry out a mo tender exercise. All replied tender queries should arrest into the contract document as contract correspondences and forming part o f contract, especially those with cost mplications. Upon apogee of evaluation of returned tenders and tender queries, the consultant quantity surveyor should prepare a tender encompass and recommend the tenderer which he preferred.Then, the letter of intent or letter of exactance should be sent out to complete the full-page appointing process. 3. 3 Sub-contract The whole tendering procedures for sub contract can be divided at 3 sections as follows- 3. 3. 1 Selection for a Specific Project When the contract was awarded to the Main Contractor as depict above, the Main Contractor takes up total responsibility for the contract work. He cannot complete the hole work victimisation only his own labour and worker. Sub-contractors is so needed, especially for EM services, which require specialist sub-contractors.Each structured main contractor should have his own domestic sub-contractors (DSC) list, the criteria for beingness qualified into the list depends on different main contrac tors. Common criteria includes work quality, asylum and health record, financial conditions, insurance cover, etc. (CIB, 1997) To appoint sub-contractors for specific project, a preliminary tenderer list should be prepared by drawing up suitable sub-contractors in the company approved list. Confirmations should be seek from potential tenderers if they are interested to tender.Numbers of tenders in the list should between four and six, for construct only sub-contract. (CIB, 1997) Same as appointing main-contractor, upon complication of tender list, preliminary enquiry should be made with sufficient project details given to the proposed tenderers. Information including conditions of contracts, payment terms, amounts of retention, commencement date and completion date of main contract, etc. Clearly state all infallible information helps to reduce disputes between the main contractor and sub-contractors. CIB, 1997) 3. 3. Tender Invitation and Submission As a formal and good practice, a tender documents for acquiring prices is recommended. By using formal tender documents, offers from different sub- contractors are more easily to be analysed. In contrast, some main contractors may preterred simpler procedures such as asking sub-contractors to submit citation themselves based on information received. However, in this report, formal tendering procedure are referred. For marrow of the tender documents, its basically the same with those described above in the Main contract section.The tenders are to be sent out with the nvitations and date for submission of tenders should have say in the invitations. The time for tendering should be 6 weeks for construct only tenders. In subject of any queries, the tenderers should submit in writing to request for clarifications from the main contractors. (CIB, 1997) Method statements may be requested to submit from the tenderers to better assess their capability for the work and cost incurred by the main contractor for providin g temporary whole caboodle platform and storage space, etc. 3. . 3 Tender Assessment and Awa rd Like the procedure of selecting Main-contractors, only tenders submit by the ubmission date would be evaluated. Non-price material like method statements should be assessed independently, different methods may affect potential costs incurred by the main-contractor. The priced document will be go by checking process first, any arithmetical errors are to be notified to the tenderer and ask whether he will stands by his tender price, procedures are generally same with those above described for main-contract.If its possible, the tender prices should never be changed if the scope of works remain unchanged. (CIB, 1997) Subcontractors should then be chosen on the basis of the assessment criteria set own before issuing tender documents. The main contractor may cut back tender discourse if he think it is necessary to clarify or set off the submitted documents. Especially those preliminary it ems, such as provision of site office, storage, lifting equipment, insurance policy, etc. Responsibility for these items should clearly state and check before awarding contract.Any matters agreed during the interview should be recorded in writing for further reference. If the main contractor has decided to appoint the tenderers as his subcontractors for the projects, the letter of acceptance should be sent as a formal record here. (CIB, 1997) In case the tendering process for sub-contractors start before the award of main- contract and the preferred sub-contractors tender are to be used for main tender submission, the sub-contractor should be notified so the sub-contractor can piece his resources more efficiently.Upon the acceptance of the main contract tender, the main contractor should also accept that sub-contract tender price agreed before and notify the sub-contractor formally. Letter of acceptance should be sent to the preferred tenderers as a formal contractual record. (CIB , 1997) Conclusions Tendering procedures for main contract and sub contract has been briefly laborated in above passage. Major differences is illustrated by Figure 2 below.Description Sub-contract Compilation of Tenderer List consultant QS or Employer Main Contractor Tendering pointedness 8 weeks tokenish 6 weeks minimum Nos. of Tenderers Figure 2 Comparison of Tendering Procedures For the tenderer list, the one used for tendering for main contract are usually recommend by the consultant quantity surveyors or the client have its own preferred list, based on reputation. In contrast, each main contractor have its own sub- contractors list based on their specialized trade.For the tendering period, the codes suggested 8 weeks minimum for main contractors to prepare their tender for the Employer succession 6 weeks minimum was suggested for sub-contractors to prepare their tender for main contractors. For numbers of tenderers, it is necessary to have sufficient numbers of tenderers to enable a fair competition. Its suggested 4-8 tenders will be luxuriant for tendering of main contracts, depends on the value and nature of the projects. Fewer numbers of tenderers would be enough for selecting sub-contractors, 4-6 tenderers is suggested in the Codes, depends on different trades.