The Aqua Group Guide to Procurement, Tendering & Contract Administration

by Hackett, Mark; Robinson, Ian; Statham, Gary

• ISBN13: 9781405131988
• ISBN10: 1405131985
• Edition: 1st
• Format: Paperback
• Copyright: 2006-11-21
• Publisher: Wiley-Blackwell

Summary

The period from starting a college course to successful completion of professional examinations represents a long and steep learning curve. The range of skills and the knowledge required to perform work efficiently and effectively might, at first, seem rather daunting. This guide will provide you with sufficient understanding and hold you in good stead for your early years in professional practice.

Author Biography

Mark Hackett, Ian Robinson and Gary Statham are Senior Quantity Surveyors at Davis Langdon, UK.

Table of Contents

Foreword by Rob Smith, Davis Langdon LLP	xvi
Introduction	xviii
Part I Briefing the Building Team	1	(18)
1 The Building Team	3	(9)
Introduction	3	(1)
Parties to a building contract and their supporting teams	3	(1)
Rights, duties and responsibilities	4	(4)
The employer	4	(1)
The architect/contract administrator	5	(1)
The quantity surveyor	5	(1)
The status of named consultants	5	(1)
Unnamed consultants with delegated powers	5	(1)
The project manager	6	(1)
The planning supervisor	6	(1)
The principal contractor	7	(1)
Sub-contractors	8	(1)
The clerk of works	8	(1)
Statutory requirements	8	(2)
The CDM Regulations	9	(1)
Avoiding disputes	10	(1)
Communications	11	(1)
2 Assessing the Needs	12	(7)
The structure	12	(1)
The brief	12	(2)
The initial programme	14	(2)
The appointment	16	(5)
Appointment documents	17	(1)
Collateral warranties	17	(2)
Part II Available Procurement Methods	19	(102)
3 Principles of Procurement	21	(9)
Simple theory - complex practice	21	(1)
The eternal triangle	21	(4)
Other considerations	25	(1)
The Construction (Design and Management) Regulations 1994	25	(1)
Risk	26	(1)
Accountability	26	(1)
Making the contract	26	(2)
Type of contract	26	(1)
Selection of the contractor - the tendering procedure	27	(1)
Establishing price and time	28	(1)
The dynamics of tendering	28	(2)
4 Basic Concepts	30	(8)
Economic use of resources	31	(1)
Labour	31	(1)
Materials	32	(1)
Plant	32	(1)
Capital	32	(1)
Contractor's contribution to design and contract programme	32	(1)
Production cost savings	33	(1)
Continuity	34	(1)
Risk and accountability	35	(1)
Accountability	36	(1)
Summary	36	(2)
5 Accountability	38	(5)
Background	38	(1)
The modern concept of public accountability	39	(1)
Contract documentation	40	(1)
Proper price	40	(1)
Dispensing with competition	40	(1)
Inflation	41	(1)
Value for money	41	(1)
Summary	42	(1)
6 Value and Risk Management	43	(14)
Value management	43	(3)
Value articulation and project definition	44	(1)
Optimisation of benefits and costs	45	(1)
Learning lessons and performance optimisation	45	(1)
Risk management	46	(4)
Risk must be managed	47	(1)
Nothing ventured nothing gained	48	(1)
Understanding the project	48	(2)
Risk management strategies	50	(1)
Allocating management actions	51	(1)
Value and risk are complementary	52	(5)
Similarities in the processes	52	(1)
The integrated process	53	(4)
7 Fixed Price and Cost Reimbursement	57	(7)
Fixed price	58	(1)
Cost reimbursement	58	(1)
Application to contract elements	59	(1)
Fluctuations	59	(1)
Target cost contracts	60	(1)
Use	60	(2)
The employer's position	60	(1)
The contractor's position	61	(1)
Programme	62	(1)
Summary	62	(2)
8 Fixed Price Contracts	64	(7)
JCT fixed price contracts	64	(6)
The Standard Building Contract	66	(1)
Design and Build Contract	66	(1)
Major Project Construction Contract	67	(1)
Intermediate Building Contract	68	(1)
Minor Works Building Contract	69	(1)
Advantages and disadvantages of fixed price contracts	70	(1)
Advantages	70	(1)
Disadvantages	70	(1)
9 Cost Reimbursement Contracts	71	(8)
The fee	71	(1)
The Prime Cost building contract	72	(1)
Characteristics of the form	72	(1)
Advantages and disadvantages	72	(1)
Advantages	73	(1)
Disadvantages	73	(1)
Budget and cost control	73	(1)
Administering the contract	74	(1)
Procedure for keeping prime costs	75	(2)
Labour resources	76	(1)
Materials	76	(1)
Plant	77	(1)
Credits	77	(1)
Sub-letting	77	(1)
Defective work	78	(1)
Cost control	78	(1)
Final account	78	(1)
10 Target Cost Contracts	79	(5)
Guaranteed maximum price contracts	82	(1)
Competition	82	(1)
Contract	82	(1)
Advantages and disadvantages	83	(1)
Use	83	(1)
11 Management and Construction Management Contracts	84	(10)
Payment and cost control	84	(2)
Selection and appointment of the contractor	86	(1)
Contract conditions	87	(1)
Contract administration	88	(1)
Professional advisers	89	(1)
Advantages and disadvantages	89	(2)
Advantages	89	(1)
Disadvantages	90	(1)
Construction Management	91	(1)
Use	92	(1)
Programme	92	(2)
12 Design and Build Contracts	94	(10)
The Contract	95	(2)
Where to use design and build (and when not to do so)	97	(1)
Managing the design process	98	(1)
Novation	99	(1)
Evaluation of submissions	99	(1)
Post-contract administration	100	(1)
Financial administration	100	(1)
Programme	101	(1)
Advantages and disadvantages	102	(2)
Advantages	102	(1)
Disadvantages	102	(2)
13 Continuity Contracts	104	(9)
Serial contracting	104	(3)
Purpose and use	105	(1)
Operation	106	(1)
Continuation contracts	107	(3)
Purpose and use	108	(1)
Operation	108	(2)
Term contracts	110	(3)
Purpose and use	110	(1)
JCT Measured Term Contract	110	(1)
Operation	111	(2)
14 Partnering	113	(8)
A definition	114	(1)
When to adopt a partnering approach	115	(1)
The agreement	116	(1)
JCT Framework Agreement	116	(1)
The partnering workshop	117	(1)
The benefits	117	(1)
The risks	118	(1)
Future of partnering	119	(2)
Part III Preparing for and Inviting Tenders	121	(92)
15 Procedure from Brief to Tender	123	(11)
Initial brief	123	(3)
Developing the brief	123	(1)
Feasibility stage	124	(1)
Sketch scheme	124	(1)
Costs	125	(1)
Procurement	126	(1)
Detail design	127	(1)
Programming	128	(1)
Design team meetings	129	(1)
Drawings	129	(1)
Specifications	130	(1)
Bills of quantities	130	(1)
Specialist sub-contractors and suppliers	131	(1)
Quality assurance	132	(1)
Obtaining tenders	133	(1)
16 Pre-Contract Cost Control	134	(20)
Cost control	134	(1)
Reporting	134	(2)
Establishing a budget	136	(1)
Approximate estimates	136	(3)
Preliminary estimate	137	(1)
Element unit quantities estimate	137	(1)
Approximate quantities estimate	138	(1)
Accurate quantities estimate	139	(1)
Cost plan	139	(12)
Substructure	140	(1)
Superstructure	140	(2)
Internal finishes	142	(1)
Fittings and furnishings	143	(1)
Services	143	(6)
External works	149	(1)
Development of the cost plan	150	(1)
Life cycle costing	151	(1)
Cash flow	152	(2)
17 Drawings and Schedules	154	(25)
The role of drawings and documents	154	(1)
Quality	155	(3)
Quality manuals	156	(1)
Quality procedure codes	156	(1)
Quality review	157	(1)
Types, sizes and layout of drawings	158	(3)
Size	158	(1)
Layout and revision	159	(1)
Scale	159	(2)
Nature and sequence of drawing production	161	(3)
Drawings for SBC contracts	161	(1)
Drawings for design and build or management contracts	162	(1)
Design intent information	163	(1)
Computer aided design	164	(1)
Drawing file formats and translation	165	(1)
Project extranets	165	(3)
Contents of drawings	168	(5)
Survey plan	168	(1)
Site plan, layout and drainage	169	(1)
General arrangement	169	(2)
Elevations of all parts of the building	171	(1)
Descriptive sections	171	(1)
Ceiling plans at all floor levels	171	(1)
Construction details (scale 1:20 and 1:10)	172	(1)
Large-scale details (scale 1:10 and 1:15)	172	(1)
Schedules	173	(1)
Drawings and schedules for records	174	(5)
18 Specifications	179	(12)
The use of specifications	179	(2)
Prescriptive specifications	180	(1)
Performance specifications	180	(1)
Descriptive specifications	181	(1)
Specification writing	181	(4)
Decide on format	181	(1)
Collect information	182	(1)
Input information	183	(1)
Check and test	183	(1)
Deliver	184	(1)
The specification as a contract document	185	(6)
19 Bills of Quantities	191	(10)
Tender and contract document	191	(1)
The wider role	192	(1)
Basic information	192	(2)
Preliminaries	192	(2)
Preambles	194	(1)
Measured works	194	(1)
Formats	194	(7)
20 Sub-contractors	201	(4)
Sub-contractors	201	(1)
Specialist sub-contractors	201	(1)
Design by the sub-contractor	202	(1)
The SBC and sub-contract agreements	203	(2)
SBC provisions under the main contract	204	(1)
21 Obtaining Tenders	205	(8)
Introduction	205	(1)
Tender list	206	(1)
Preliminary enquiry	207	(1)
Tender documents and invitation	208	(1)
Tender period	209	(1)
Tender compliance	209	(1)
Late tenders	209	(1)
Opening tenders	210	(1)
Examination and adjustment of the priced document	210	(1)
Negotiated reduction of a tender	211	(1)
Notification of results	211	(1)
Tender analysis	212	(1)
Part IV Contract Administration	213	(154)
22 Placing the Contract	215	(12)
Preparing and signing the contract documents	215	(4)
Sectional completion	216	(1)
Contractor's designed portion	217	(2)
Executing the contract	219	(1)
Performance bonds and parent company guarantees	219	(1)
Collateral warranties	220	(1)
Third party rights	220	(1)
Issue of documents	220	(2)
Insurances	222	(5)
23 Rights, Duties and Liabilities under the SBC	227	(19)
Introduction	227	(18)
The employer	227	(13)
The architect/contract administrator	240	(3)
The quantity surveyor	243	(1)
The planning supervisor	244	(1)
The clerk of works	244	(1)
The person-in-charge	245	(1)
Conclusion	245	(1)
24 Meetings	246	(11)
Initial meeting	246	(5)
Introductions	247	(1)
Factors affecting the carrying out of the works	247	(1)
Programme	248	(1)
Sub-contractors and suppliers	249	(1)
Lines of communication	249	(1)
Financial matters	249	(2)
Procedure to be followed at subsequent meetings	251	(2)
Contractor's meetings	253	(1)
Employer's meetings	253	(4)
25 Site Duties	257	(22)
The architect on site	257	(1)
Supervision and inspection	258	(6)
Routine site visits	259	(1)
Consultants' site visits	260	(1)
Inspections by statutory officials	260	(1)
Records and reports	261	(2)
Samples and testing	263	(1)
Considerate Constructors Scheme	264	(1)
Site safety	265	(4)
Health and Safety Policy	265	(4)
Fire precautions on site	269	(10)
Regulatory control	269	(1)
The Joint Fire Code	269	(1)
Means of escape	270	(1)
Fire-fighting equipment	271	(1)
Emergency plans	272	(1)
Providing information	272	(7)
26 Instructions	279	(5)
Architect/contract administrator's instructions	279	(5)
27 Variations and Post-Contract Cost Control	284	(7)
Variations	284	(1)
Valuing variations	285	(3)
Dayworks	285	(3)
Cost control	288	(3)
28 Interim Payments	291	(14)
Introduction	291	(2)
Payments of pre-determined amounts at regular intervals	292	(1)
Pre-determined payments at pre-determined stages	293	(1)
Regular payments by detailed valuation	293	(1)
Certificates and payments under the SBC	293	(4)
The architect/contract administrator	294	(1)
The quantity surveyor	294	(1)
The employer	294	(2)
The contractor	296	(1)
Interim certificates under the SBC	297	(2)
Unfixed materials and goods on site	298	(1)
Unfixed materials and goods off site	298	(1)
Retention under the SBC	299	(1)
Payments to sub-contractors under the SBC	300	(1)
Value added tax	300	(1)
Valuation and certificate forms	300	(5)
29 Completion, Defects and the Final Account	305	(13)
Practical completion	305	(3)
Partial possession	308	(1)
Possession of the building	309	(1)
Defects and making good	309	(1)
Final account	310	(4)
Adjustment of the contract sum	311	(2)
Practical considerations	313	(1)
Final certificate	314	(4)
30 Delays and Disputes	318	(21)
Introduction	318	(1)
Delays caused by the contractor	319	(1)
Delays caused by employers or their representatives	319	(1)
Delays caused by events outside the control of either party	320	(2)
Force majeure	321	(1)
Exceptionally adverse weather conditions	322	(1)
SBC procedure in the event of delay	322	(4)
Best endeavours	322	(1)
Notification of delay	323	(1)
New completion dates	323	(1)
Final adjustment	324	(1)
Duties and decisions	325	(1)
Reimbursement of loss and/or expense under the SBC	326	(1)
Liquidated damages	327	(1)
Disputes and dispute resolution	328	(11)
Mediation	329	(1)
Adjudication	329	(5)
Arbitration	334	(2)
Litigation	336	(3)
31 Insolvency	339	(18)
Introduction	339	(1)
Insolvency practitioners	339	(1)
Liquidation	340	(1)
Receivership	341	(1)
Administration	341	(2)
After the Enterprise Act 2002	342	(1)
Voluntary arrangements and compositions	343	(1)
Debentures	344	(1)
Procedure upon the insolvency of the contractor	344	(8)
The SBC provisions	345	(1)
Early warning signs and precautionary measures	346	(2)
Completion of the works	348	(2)
Completion documentation	350	(1)
Sub-contractors	351	(1)
Bonds	352	(1)
Final accounts	352	(2)
The procedure upon the insolvency of the contractor	354	(3)
32 Capital Allowances	357	(10)
Introduction	357	(2)
Eligibility for capital allowances	358	(1)
The worth of capital allowances	358	(1)
Tax deductions for property refurbishment schemes	359	(3)
Capital or revenue?	359	(1)
Incidental capital expenditure	360	(1)
Deferred revenue expenditure	360	(1)
Action summary	361	(1)
Energy saving plant and machinery	362	(3)
Key features	362	(1)
Key exclusions	363	(1)
How to claim ECAs	364	(1)
Qualifying products and items	364	(1)
Pre-contract planning to optimise capital allowances	365	(1)
Some questions and answers	365	(2)
Index	367