I went from nodding in agreement to shaking my head in just two sentences:
A contract sets out the expectations of both the client and the contractor. A contract gives you the peace of mind that the contractor will deliver the project within an agreed timeframe, at an agreed cost and to an agreed level of quality.
This extract is from an article is designed to help readers realise their dream project, using the author (an experienced consultant).
A contract should be designed to set out (and so manage) the expectations of the client and its contractor.
The article recommended a written contract (better than a handshake).
Guaranteed peace of mind?
A contract does not provide the peace of mind this article suggests. It just doesn’t.
A construction contract will:
- set out the initial timeframe BUT it will also set out events that will allow the contractor to ask for more time; EVEN SO 37% of projects are completed later than the extended completion date.
- set out the initial agreed cost BUT it will also set out the right to change the scope (and possibly the cost) as well as other events that will allow the contractor to ask for more money; EVEN SO 34% of projects are over budget at completion.
- set out the agreed levels of quality BUT it will also include a remedy for defective work; AND 13% of clients rate their overall satisfaction with the finished project as less than 8 out of 10.
To properly manage the expectations of the client and the contractor, the contract should explain the realities of a construction project to the client.
It should set out the initial plans, how those plans can or will change, and describe any controls the client wants over those changes. It cannot provide peace of mind at the start, as there are often too many unknowns.
What should you do?
Whichever party you are, be clear on how the initial time, cost and quality can change as the project progresses. Ensure you understand the processes, and who has control over those changes. Get advice or an independent person to help you manage time, cost and quality on site.
Don’t rely on empty promises, pointless guarantees or chance!