Getting a penalty clause in a building contract

[Carl_Spackler]

hahithestevieboy said:

sleep envy said:

Carl_Spackler said:

sleep envy said:

Carl_Spackler said:

Interesting, on the very few occations we've had these levied, the client has just deducted them from from the interim certificate (Scotland) and we've spent the next months fighting to get them back, always have mind you, Loss and Expense suddenly becomes mega bucks

what contract was that under and who was administering it?

Can't remember probably JCT private with quants, small projects, 500k to 1M.

IMO you need to review this as they can't and shouldn't be doing this contractually

Bloody right. You can only apply L&AD's if the contract administrator (probably the architect) has issued a non completion certificate and then a (late) practical completion certificate. You can charge the L&AD's to the contractor then in the final account. That usually happens at the end of a job (unless sectional completion). Besides, private with quants sounds like a 98 form. Was is ages ago?

This was 5-7 years ago.

Almost all contracts we carry out have an L + A damage clause set at as little as 100 - 3000 pounds a week, so if the CA determines you are late issues practical completion cert "x" amount of weeks after the contract completion date and does not/is still in the procces of determining the validity of your EOT claim, can the L + A damages be deducted at the rate stated in the BOQ or does the client have to produce evedence of his costs resultant of your late completion?

For the OP, up here we have a contract from the SBCC called JCT "Building Contract for a home owner/occupier (without a consultant)" but it isn't for use in England or Wales, which talks about staged payments, not L + A damages.

Edited by Carl_Spackler on Wednesday 1st April 08:51

[sleep envy]

GT03ROB said:

Perfomance bonuses & incentive schemes are however becoming more common with the more sophisticated clients. Far better to let the contractor earn double his profit margin by paying a bonus and bring the facility in a few months early. The cost to the client is minimal relative to the return.

yep, the clients who focus on CROI are usually the better ones in my experience - they just want to get things built and aren't interested in arse covering and blame culture

[sone]

I said it before and I will say it again if you have to refer to terms of contract both client and contractor are on a loser!.
Final accounts at the lower end of the project value should be settled over a pint and adult conversation. While the client is holding the funds he will always have the upper hand. As a client identify your loses to the contractor front him with it and give him a ultimatum settle or wait even longer for your money. I don't mean that this gives the client the opportunity to be a smart arse just a tool to settle and move on.