Contract Management Assessment Question and Answer

 

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Contract Management

 

Business Study

 

You run your own small to medium size organisation with your own office premises external to your home.

 

The organisation employs: two (2) site supervisors; two (2) carpenters; two (2) labourers; one (1) admin staff and you as the owner are the estimator/manager.

 

The organisation constructs in any one (1) year:

  • 6 x 3 bedroom cottages – cost valued at $270 000
  • 3 x renovations – cost valued at $90 000 – $120 000
  • 5 x shed/warehouse (maximum size 2000m²) – cost valued at $80 000 – $100 000

 

Remember you are the builder and hence you are responsible for everything that happens on your sites. Do not consider yourself as a subcontractor or employee.

 

You must prepare this task based on the fact that you own the business. “The buck stops with you”! This task will assist you to prepare your contracts and all the necessary documents that are required for any size project.

 

What are the procedures (step by step instructions for someone to follow in your absence) and what documentation/forms must be completed to support each clause within the contract?

 

Clearly identify:

  • Who does what, when they do it and how they do
  • Who makes the final
  • Who does the checking and
  • What happens after the review

 

ASSESSMENT TASK 4

CONTRACT ADMINISTRATION PROCEDURES

THIS TASK IS IN 3 PARTS – A, B & C

 

PART A

 

Write a procedure to administer (which means managing and documenting) all the clauses in a building contract. (Refer to the previous Page 5 of 9 of this task – as a guide).

 

You must ensure you cover the following clauses in your procedures as a minimum requirement.

  • Extension of Time
  • Variations
  • Retention
  • Progress Claims
  • Practical Completion
  • Suspension of Works
  • Statutory Warranties
  • Defective Work by Sub Contractor/Supplier – Not Defects Liability
  • Liquidated Damages
  • Defects Liability
  • Sub Contract Documents
  • Procedure if the Sub Contractors Default

 

PART B

 

Provide an example of the support documentation – for example forms, checklists, schedules etc., that is associated with each of the above clauses:

 

An example of these documents is as follows – This list is a guide only and is not a final list:

  • Site Diary
  • Schedules
  • Checklists
  • Extension of Time
  • Variations
  • Retention
  • Progress Claims
  • Practical Completion
  • Handover Forms
  • Suspension of Works Notice
  • Statutory Warranties Advice
  • Defective Work by Sub Contractor/Supplier Notice – Not Defects Liability
  • Liquidated Damages Notice
  • Defects Liability Forms
  • Subcontract Documents – Contracts, SWMS, Safety Documents
  • Subcontractors default notice

 

PART C

 

Set out how you intend to Review the full process. (Refer to Page 5 of 9 again as a guide).

  • Who will be reviewing that the procedures are carried out correctly.
  • When and how often will the Review Process be conducted.

 

Provide a checklist of areas that must be considered in the review, for example:

  • Extension of Time
  • Variations
  • Retention
  • Progress Claims
  • Practical Completion
  • Suspension of Works
  • Statutory Warranties
  • Defective Work by Sub Contractor/Supplier – Not Defects Liability
  • Liquidated Damages
  • Defects Liability
  • Sub Contract Documents
  • Procedure if the Sub Contractors Default

 

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