Contract Of Agreement

One of the most important documents that should be discussed with any builder or contractor is the contract of agreement. Whether it is a formal contract or one which has been mutually agreed upon, it may become a vital document in the event of any financial or contractual discrepancies.

Some contractors may ask you to enter into a contract with them, which would generally indicate a professional set-up. However, the domestic sector does not usually work with such safeguards.

The advantage of entering into a contract – especially when large sums of money are involved – is that you have a legal document which relates to the written quote from the contractor.

What The Contract Should Cover

The contract should include the terms of payment and any bonus/incentive clause as discussed in Chapter 7. However, as clearly spelled out, these types of arrangement can only work when there are no changes to the specification, and when there are sufficient information and drawings to minimise any additional work or changes.

Included in this guidebook is a sample contract of agreement, which will give you an idea of what you need to cover. Alternatively, there are ‘off-the-shelf’ contracts available such as the JCT (Joint Contracts Tribunal) Building Contract for a home owner/occupier, as detailed below.

Financial Agreements

Always have any financial agreement confirmed in writing, no matter how small the amount. It is the first thing that any legal representative will ask you for in the case of any form of dispute.

Formal Contracts

A formal contract of agreement is meant to protect the interests of both parties, so if the contractor refuses to enter into such an agreement it may be best to choose one who does.

Formal contracts do not have to be sanctioned by a solicitor, but it is advisable to have a third party witness the agreement.

‘off-The-Shelf’ Contracts

Alternatively, ‘off-the-shelf’ contracts are available such as the JCT (Joint Contracts Tribunal) Building Contract for a home owner/occupier which covers the areas outlined in Figure 6.1.

Figure 6.1

Coverage of the JCT Building Contract

The type of contract shown in Figure 6.1 would normally be used in a situation which involves larger amounts of money but it is down to the discretion of the individual whether or not this contract is used.

In any case it is worthwhile obtaining a copy of the JCT contract so that you understand the responsibilities placed upon both the builder/contractor and yourself.

Writing Your Own Contract

You may decide to write your own contract but I do advise you to seek legal advice if you are in any doubt.

Method Statement

What Is A Method Statement?

This is not a document that the general public will necessarily be familiar with, and in fact most domestic builders will not have been required to produce one.

A method statement is a descriptive account of the way in which a particular operation will be carried out, for example what precautions the builder will be taking to ensure the security of your property, and how he will ensure the safety of all the people involved in the project.

Requesting A Method Statement

It is not unreasonable for you to request a method statement, for example, for any work that may cause a

Figure 6.2

Sample method statement

security risk or safety issue, or where the sequence of work is important to minimise inconvenience.

A contractor may put up resistance to providing method statements. However, he only needs to discuss these elements with you, although the discussion should be recorded.

You may also be required to produce the information for your insurance company.

Example Of A Method Statement

Figure 6.2 provides an example of the type of information that would be covered in a method statement: details of the work or works, the location of the work or works, the plant to be used, the method to be adopted for each element of the works, and where and how precautions will be taken.