CONTRACT ADMINISTRATION- Presentation dated 22.11.16

CONTRACT
ADMINISTRATION
BY- ARVIND SOLANKI

CONTRACT A contract is a legally binding or valid agreement
between two parties.What is Contract?

CONTRACT
1. offer and acceptance;
2. an intention between the parties to create
binding relations;
3. consideration to be paid for the promise made;
4. legal capacity of the parties to act;
5. genuine consent of the parties; and
6. legality of the agreement.
An agreement that lacks one or more of the
elements listed above is not a valid contract.
Elements of contract

CONSTRUCTION /
BUILDING CONTRACT
A Contract between an Owner (Client) and a
Building Contractor, setting forth the terms under
which construction is to be carried out, the basis of
remuneration, the time scale, and the penalties, if
any, (for failure to comply with terms of the
Contract) is termed as a Building/Construction
Contract.
What is Construction / Building
contract

CONSTRUCTION /
BUILDING
CONTRACT
1. The Contract or Agreement letter.
2. General Conditions of the Contract – these define the legal rights and
obligations of the parties; another way of describing the general conditions is as
the rules by which each party will operate in performing their obligations as set
down under the Contract.
3. Special conditions of Contract – these are an extension to the general
conditions and apply specifically and individually to each project/Contract.
4. Bill of quantities – it lists quantities of the various items and the material to be
included in the Contract. It can also be used as the basis for valuation of
variations and assists the preparation of progress claims. The extent to which the
Owner warrants the completeness of a bill of quantities or a schedule of rates
depends upon the terms of the Contract.
5. All drawings required in building the structure (contract plans including
Architectural and Structural). These include drawings from relevant Consultants.
6. All Specifications – sets out the technical requirements of the work It describes
the project and adds clarity to its drawings; describes the requirements for
materials and workmanship.
7. All other documents considered necessary, for example, Schedule or Annexure to
the Contract completed, all technical schedules, all pricing schedules.
Principle elements of
Construction / Building
contract

ROLE OF CONTRACT
IN PROJECTS
Project is a temporary endeavour undertaken to
create a unique product (such as a building,
conservation of structure, laying a pipeline etc.).
The temporary nature of a project indicates a
defined beginning and end. The end is reached
when project objective have been achieved or when
the project is terminated because its objective
cannot be met.
What is a Project?

ROLE OF CONTRACT
IN PROJECT
When client wish to hire the services of other
agencies to do full or part of project, he offers for
bid. The successful bidder enter into a contract with
client. Project may have many contracts
Contracts a Project?

PROJECT
1. Initiation
2. Planning
3. Execution
4. Monitoring and Control
5. Closure
Phases of Project

PIU’S ROLE
1. Execution
2. Monitoring and Control
3. Closure
Phases where PIU’s has to play
major role

PIU’S ROLE 1. Direct and Manage Project Execution
2. Perform Quality Assurance
3. Distribute Information
Execution Phase

PIU’S ROLE
1. Monitor and Control Project work
2. Perform Integrated Change control
3. Report Performance
4. Identify, Monitor and control Risk
Monitoring and Control Phase

PIU’S ROLE 1. Close project/phase
2. Close Procurements/contractClosure Phase

1.1DIRECT AND MANAGE PROJECT EXECUTION
1. Ask in writing to contractor to submit all statuary documents (and make sure he has
submitted the same)- such as BG(as per GCC 59), Insurances (as per GCC 19) etc.
as per contract agreement.
2. Ask in writing to contractor to submit Project Schedule (and make sure he has
submitted the same) (as per GCC 35).
3. Ask in writing to contractor to mobilise key personal and machinery (as per GCC
15) to meet the time line in contractors submitted schedule.
4. Ask and guide to contractor to prepare a quality control plan based on
specifications in contract agreement.

1.2 PERFORM QUALITY ASSURANCE
1. Ensure that all the test required in specifications are included in Quality control
plan.
2. Maintain Test register and verify the results of test conducted.
3. Ensure frequency of tests are as per specifications.
4. Inspect and verify Material Data Sheet of factory supplied materials. And get the
material stored and applied as per mentioned in material data sheet.

1.3 DISTRIBUTE INFORMATION -IN THE FORM OF MOMS,
PROGRESS REPORTS
1. Write letter to contractor about required Progress, Quality, EHS, extension of BGs and copy to relevant
stakeholders (such as PIU Civil Engineer, PMU Civil Engineer, CGM, APD, PD, TL PMC, TL DSC)
2. Write letter to PMU for approval of Extra Items, Variation statements, Bill verifications and copy to relevant
stakeholders (such as PIU Civil Engineer, PMU Civil Engineer, CGM, PD, TL PMC, TL DSC).
3. Write letter to DSC for required drawings, bill preparation, design submission, quality control issues copy to
relevant stakeholders (such as PIU Civil Engineer, PMU Civil Engineer, CGM, APD, PD, TL PMC,)
4. Issue completion Certificate to Contactor and copy to relevant stakeholders (such as PMU Civil Engineer, CGM,
APD, PD, TL PMC, TL DSC)
5. Circulate MoMs of weekly and monthly review meetings to all participants and copy to relevant stakeholders
(PMU Civil Engineer, CGM, APD, PD, TL PMC).
6. Submit Monthly Progress Report to PMU and copy to relevant stakeholders (such as PMU Civil Engineer, CGM,
APD, PD, TL PMC, TL DSC)

2.1 MONITOR AND CONTROL PROJECT WORK
1. Track each activity of schedule submitted by contractor as described in item 2 of Direct and Manage
Project Execution. Take immediate action as and when you find that there is deviation from
schedule.
2. Check that necessary key personal and equipment are deployed by contractor as described in item
3 of Direct and Manage Project Execution.
3. Evaluate the hazards at site and instruct contractor to maintain safe working environment.
4. Ensure that contractor is complying with all the points given in EMP (Environmental Management
Plan) of contract agreement.
5. Cash flow to be taken from Contractor which should be based on contractor’s schedule (as per GCC
48).
6. Recommendation of Extension of Time has to be as per GCC 36. Please read carefully 36.2 before
recommending EOT.

2.2 PERFORM INTEGRATED CHANGE CONTROL
1. After instruction by PM for variation, contractor has to submit the quotation to
carry out variation (as per GCC 47.2).
2. Contractor’s schedule will be revised to incorporate the variation (as per GCC
47.1)
3. At some cases contract price of an item may be revised due to deviation in from
BOQ quantity (as per GCC 46).

2.3 REPORT PERFORMANCE
1. Monthly Progress reports
2. Environmental Monitoring Report (Every 6 months)
3. Social Safeguard Monitoring Report (Every 6 months)
4. Gender Action Plan (Every 6 months)
5. Any other information feel necessary to be informed

2.4 IDENTIFY, MONITORING AND CONTROL RISK
1. Identify risk due to:
a. Schedule over run
b. Scarcity of a particular material in market
c. Met a sever accident at site
d. Etc etc etc….
2. Monitor the impact of the risk.
3. Control Risk by adopting mitigation actions such as:
1. Liquidated damage clause as per(as per GCC 56)
2. May be substituting of material in subject by any other suitable material or hazing of material
3. Insure that insurance cover has been taken and its date has not expired (as per GCC 19).

3.1 CLOSE PROJECT/ PHASE
1. Check that all the activities has been completed.
2. Make area wise punch list
3. Lebel the key of locks
4. Prepare inventory
5. Complete the works mentioned in punch list.
6. Inspection with client/concessionaire and prepare client’s punch list
7. Rectify as per client’s punch list
8. Record of Handing over the property
9. Issue of completion Certificate (As per GCC 69)

3.2 CLOSE PROCUREMENT/CONTRACT
1. Collect as built drawing/ operation and maintenance Manuals from Contractor
(As per GCC 72).
2. Write and submit lesion learnt during the contract.

CONTRACT ADMINISTRATION- Presentation dated 22.11.16

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