Appropriate-contract-selection-2nd-edition
RICS Practice Information: Appropriate Contract Selection (2nd Edition, April 2024)
Overview
Publisher: Royal Institution of Chartered Surveyors (RICS)
ISBN: 978 1 78321 524 9
This document provides guidelines on selecting appropriate construction contracts applicable in the UK.
Copyrighted material, permission required for reproduction except as per licensing agreements.
Table of Contents
Acknowledgements
RICS Standards Framework (pg. 1)
Document Definitions (pg. 2)
Introduction (pg. 3)
General Principles (Level 1 – Knowing) (pg. 5)
Practical Application (Level 2 – Doing) (pg. 44)
Practical Considerations (Level 3 – Advising) (pg. 56)
Acknowledgements
Lead Author: Richard Dartnell (Pinsent Masons)
Expert Working Group: Various professionals contributing expertise from organizations such as Laing O’Rourke, BAM Construction, Gleeds, etc.
RICS Standards Framework (pg. 5)
Governed by the Standards and Regulation Board (SRB) to operate in the public interest.
Aims to develop technical and ethical competence in the surveying profession.
Collaboration with other bodies for coherent professionalism is emphasized.
Document Definitions (pg. 6)
RICS Professional Standards: Set of mandatory requirements for service delivery.
RICS Practice Information: Non-mandatory guidance to support RICS members.
Introduction (pg. 7)
Reviews types of construction contracts available in the UK.
Focuses on factors for clients (employers) to consider when engaging contractors.
Guidance categorized in three levels:
Level 1: General Principles
Level 2: Practical Application
Level 3: Practical Considerations
General Principles (Level 1 – Knowing) (pg. 9)
Introduction
Overview of procurement routes.
Utilization of various forms of standard contracts.
Procurement Routes
Importance of analyzing project requirements before contract selection.
Distinction between procurement and contracting; procurement involves multiple relationships.
Types of Procurement Routes
Traditional (‘Design-Bid-Build’)
Separate responsibility for design and production.
Example: Fixed price lump-sum contracts.
Design and Build
Contractor responsible for both design and construction.
Construction Management
Separate construction manager oversees project.
Management Contracting
Management contractor manages without doing construction works directly.
Partnering
Cooperative relationship among stakeholders.
Public Private Partnerships (PPP)
Various forms involving private sector consortiums delivering public services.
Practical Application (Level 2 – Doing) (pg. 44)
Introduction
Discusses interrelationship between procurement, tendering, and contract selection.
Selection Process
Importance of understanding procurement, tendering.
Other Influencing Factors
Works required, size, value, complexity of projects guide contract choice.
Practical Considerations (Level 3 – Advising) (pg. 56)
Introduction
Essential elements for creating a valid contract:
Offer, acceptance, consideration, certainty of terms, intention to create legal relations.
Contract Documents
Importance of detailing all necessary documents for execution of the contract.
Amending Standard Contracts
Common reasons for amendments include altering risks, inserting obligations, and reflecting project-specific requirements.
Execution of Contracts
Contracts can be executed as deeds or simple agreements, affecting liability durations.
Conclusion
Continuous awareness of parties’ responsibilities and risk management is critical for compliance and effective contract selection within the UK construction sector.
RICS Practice Information: Appropriate Contract Selection (2nd Edition, April 2024)
Overview
Publisher: Royal Institution of Chartered Surveyors (RICS)
ISBN: 978 1 78321 524 9This document provides comprehensive guidelines for selecting appropriate construction contracts applicable in the UK, detailing the nuances of different procurement routes and their implications on project outcomes.
Copyright: The material is copyrighted, requiring permission for reproduction, except as permitted under specific licensing agreements.
Table of Contents
Acknowledgements
RICS Standards Framework (pg. 1)
Document Definitions (pg. 2)
Introduction (pg. 3)
General Principles (Level 1 – Knowing) (pg. 5)
Practical Application (Level 2 – Doing) (pg. 44)
Practical Considerations (Level 3 – Advising) (pg. 56)
Acknowledgements
Lead Author: Richard Dartnell (Pinsent Masons)
Expert Working Group: Contributions from various professionals representing esteemed organizations such as Laing O’Rourke, BAM Construction, and Gleeds, reflecting a broad spectrum of expertise in construction and project management.
RICS Standards Framework (pg. 5)
The framework is governed by the Standards and Regulation Board (SRB) to ensure operations serve the public interest.
It aims to elevate both technical and ethical competence within the surveying profession, ensuring that RICS members adhere to high standards of practice.
Emphasizes collaboration with other professional bodies to promote coherent professionalism across sectors.
Document Definitions (pg. 6)
RICS Professional Standards: A set of mandatory obligations that guide the service delivery of RICS members, ensuring consistency and quality across practices.
RICS Practice Information: Offers non-mandatory guidance designed to assist RICS members in making informed decisions about practice areas and contract selection strategies.
Introduction (pg. 7)
Provides a detailed review of the various types of construction contracts available in the UK.
Focuses on essential factors for clients (employers) to consider when engaging contractors, ensuring that decisions reflect the project’s specific needs and objectives.
Guidance is categorized into three levels to support varying degrees of engagement in contract selection:
Level 1: General Principles
Level 2: Practical Application
Level 3: Practical Considerations
General Principles (Level 1 – Knowing) (pg. 9)
Introduction:
Provides an overview of different procurement routes,
Highlights the importance of Baseline project requirements as a precursor to contract selection.
Types of Procurement Routes:
Traditional (‘Design-Bid-Build’) Contracting: Separates design and production roles, enhancing accountability.
Example: Fixed price lump-sum contracts standards.
Design and Build: The contractor assumes responsibility for both design and construction, which can streamline communication and reduce project timelines.
Construction Management: A separate construction manager oversees the project, allowing for greater flexibility and specialization.
Management Contracting: Involves a management contractor who manages the project without directly conducting construction works, fostering innovation in management.
Partnering: Promotes cooperative and collaborative relationships among stakeholders, enhancing project vision alignment.
Public Private Partnerships (PPP): Encompass diverse forms where private sector consortiums partner with the public sector to deliver public services, requiring intricate contract negotiations and management.
Practical Application (Level 2 – Doing) (pg. 44)
Introduction:
Explores the intricate interrelationship between procurement, tendering, and contract selection, highlighting their influence on project success.
Selection Process:
Necessitates a profound understanding of procurement and tendering processes to ensure appropriate contract alignment with project goals.
Other Influencing Factors:
Evaluates the nature of works required, including size, value, complexity, and scope of projects to guide contract selection, ensuring decision-making is data-driven and strategically sound.
Practical Considerations (Level 3 – Advising) (pg. 56)
Introduction:
Identifies essential elements for creating a valid contract, including:
Offer, acceptance, consideration, certainty of terms, and intention to create legal relations, all pivotal for legal enforceability.
Contract Documents:
Stresses the importance of detailing all necessary documentation for the execution of the contract, which can minimize misunderstandings and disputes post-agreement.
Amending Standard Contracts:
Discusses common reasons for amendments, like altering inherent risks, inserting specific obligations unique to the project, and reflecting the project's idiosyncratic requirements to align with strategic goals.
Execution of Contracts:
Clarifies the methods of executing contracts, whether as deeds or simple agreements, as these choices significantly influence liability durations and participant obligations.
Conclusion
Emphasizes the need for continuous awareness and proactive management of parties' responsibilities and risk management to ensure compliance and effective contract selection within the dynamic UK construction sector.