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What should be included in a construction contract?
Standard construction contracts should have the following information and clauses: Name of contractor and contact information. Include the contractor's license number along with phone number, email address, and company address. Name of homeowner and contact information.
How do you write a construction contract?
Step 1: Review State and Local Law Requirements for Inclusion. Step 2: Create a Title. Step 3: Compose a Preamble. Step 4: Create a Project Overview. Step 5: Provide an Exact, Thorough Description of the Work. Step 6: Establish a Clear Project Schedule. Step 7: Identify How Contingencies Will be Handled.
How do you read a construction contract?
Read everything before signing. Ensure everything you agree to be in writing and part of the contract. Understand the indemnity clause. Understand the additional insured clause. Outline how change orders will be handled. Understand arbitration clauses, jurisdiction clauses, and attorneys' fees clauses.
How do you prepare a contract?
Get it in writing. Keep it simple. Deal with the right person. Identify each party correctly. Spell out all the details. Specify payment obligations. Agree on circumstances that terminate the contract.
What are the advantages and disadvantages of lump sum contract?
Lump Sum Contract(Advantages) Low risk on the owner, Higher risk to the contractor Cost known at outset Contractor will assign the best personnel Contractor selection is easy. 9. Lump Sum Contract(Disadvantages) Changes is difficult and costly.
When would you use a lump sum contract?
When to Use This Type of Contract A lump-sum contract is a great contract agreement to be used if the requested work is well-defined and construction drawings are completed. The lump-sum agreement will reduce owner risk, and the contractor has greater control over profit expectations.
What does lump sum mean in a contract?
Under a lump sum contract, a single 'lump sum' price for all the works is agreed before the works begin. It is defined in the CIO Code of Estimating Practice as, 'a fixed price contract where contractors undertake to be responsible for executing the complete contract work for a stated total sum of money.
What is the difference between fixed price and lump sum contract?
Lump sum (or stipulated sum) contracts are sometimes referred to as 'fixed price' contracts, although strictly this is not correct. On a lump sum contract, a single 'lump sum' price is agreed before the works begin.
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