Contractual Terms Assessment

📝 Checklist for Contract Review | Follow Ilamparithi BoologaSundaraVijayan 1️⃣ Parties   Are the parties clearly identified, and are the signatories authorized to commit to the agreement? 2️⃣ Scope of Work   Is the scope of work clearly defined and comprehensively described? 3️⃣ Acceptance   Has the offer been formally accepted by the relevant party? 4️⃣ Consideration and Responsibility   Does the contract state the consideration (what each party will get in return) and outline the responsibilities of each party? 5️⃣ Delivery   Does the contract specify delivery timelines, including dates and milestones? 6️⃣ Payment Terms   Are the payment terms and conditions clear and defined? 7️⃣ Variation/Change Orders   Does the contract outline the process for requesting and approving changes or variations to the scope of work? 8️⃣ Dispute Resolution   Are there clear steps for resolving disputes, including negotiation, mediation, or legal recourse? 9️⃣ Force Majeure   Does the contract address what happens in the event of unforeseeable circumstances that prevent contract performance? 🔟 Expiry Dates   Does the contract mention the contract duration or expiry dates? 1️⃣1️⃣ Renewal Terms   Are there provisions for contract renewal? 1️⃣2️⃣ Penalties/Fees   Does the contract define penalties or fees for non-compliance or failure to meet obligations? 1️⃣3️⃣ Insurance and Warranty   Are the necessary insurance and warranty provisions included and clearly defined? 1️⃣4️⃣ Default Clause   Does the contract outline specific breaches or default circumstances? 1️⃣5️⃣ Termination Clause   Are the conditions for contract termination specified, along with available remedies for the non-breaching party? 1️⃣6️⃣ Confidentiality Clause   Is there a confidentiality agreement included, and are the penalties for breaches specified? 1️⃣7️⃣ Arbitration Clause   Does the contract include clear arbitration procedures, including the selection of arbitrators? 1️⃣8️⃣ Choice of Law Clause   Does the contract address governing law, particularly if cross-jurisdictional issues arise? 1️⃣9️⃣ Limitation of Damages   Are the types and amounts of recoverable damages clearly defined?

Quantifying the time impact of variations. The absence of a specified methodology within a contract for quantifying the time impact of variations frequently becomes a contentious issue. Quantification is determined either on a prospective or retrospective basis. Prospective Assessment: This method involves making an assessment based on the information available, typically before the commencement of a variation. It's not uncommon for an employer to request a contractor to submit a variation proposal which involves estimating the time impact before the variation begins. Retrospective Assessment: In contrast, this assessment involves analysing the time impact after the variation has been completed and the full facts are known. Disagreements often arise regarding a prospective assessment, prompting an employer to instruct the additional work to proceed and to assess the time impact retrospectively. Under certain circumstances, both approaches hold merit. However, when the full details of a variation are clear from the outset, such as revised drawings and specifications, a prospective approach invariably provides greater certainty to the parties. The retrospective analysis, while valuable, often introduces a subjective element regarding the contractor's actual efficiency in implementing the change. Particularly, whether the contractor proceeded with the variation in an expeditious manner or without undue delay (or similar language as often stipulated in contracts). This subjectivity often leads to disputes, as parties’ debate whether the variation was executed in a timely manner. The most effective strategy to circumvent such disputes is seeking prior agreement on the impact of a variation. This approach serves the interests of both parties. #icrsconsult #variations #eotclaims

𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁 𝗥𝗶𝘀𝗸 𝗔𝘀𝘀𝗲𝘀𝘀𝗺𝗲𝗻𝘁 𝗶𝗻 𝗖𝗼𝗻𝘀𝘁𝗿𝘂𝗰𝘁𝗶𝗼𝗻 Effective risk assessment helps ensure that projects are completed on time, within budget, and to the required quality standards. Here’s a step-by-step guide on how to conduct a contract risk assessment in construction: 1. 𝙍𝙚𝙫𝙞𝙚𝙬 𝘾𝙤𝙣𝙩𝙧𝙖𝙘𝙩 𝙏𝙚𝙧𝙢𝙨 Carefully review the contract terms to ensure they address the identified risks. Key areas to focus on include: -- 𝗦𝗰𝗼𝗽𝗲 𝗼𝗳 𝗪𝗼𝗿𝗸: Clearly define the project scope to avoid misunderstandings and disputes. -- 𝗣𝗮𝘆𝗺𝗲𝗻𝘁 𝗧𝗲𝗿𝗺𝘀: Ensure payment schedules and terms are clearly outlined to prevent financial issues. -- 𝗖𝗵𝗮𝗻𝗴𝗲 𝗢𝗿𝗱𝗲𝗿𝘀: Establish a process for managing changes to the project scope, schedule, and budget. -- 𝗗𝗶𝘀𝗽𝘂𝘁𝗲 𝗥𝗲𝘀𝗼𝗹𝘂𝘁𝗶𝗼𝗻: Include provisions for resolving disputes, such as mediation or arbitration. 2. 𝙄𝙙𝙚𝙣𝙩𝙞𝙛𝙮 𝙋𝙤𝙩𝙚𝙣𝙩𝙞𝙖𝙡 𝙍𝙞𝙨𝙠𝙨 Start by identifying all potential risks that could impact the project. These risks can be categorized into several types: -- 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗥𝗶𝘀𝗸𝘀: Cost overruns, budget shortfalls, and payment delays. -- 𝗟𝗲𝗴𝗮𝗹 𝗥𝗶𝘀𝗸𝘀: Contract disputes, compliance issues, and liability concerns. -- 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝗥𝗶𝘀𝗸𝘀: Delays in project timelines, resource shortages, and equipment failures. -- 𝗘𝗻𝘃𝗶𝗿𝗼𝗻𝗺𝗲𝗻𝘁𝗮𝗹 𝗥𝗶𝘀𝗸𝘀: Weather conditions, natural disasters, and environmental regulations. 3. 𝘼𝙣𝙖𝙡𝙮𝙯𝙚 𝙩𝙝𝙚 𝙍𝙞𝙨𝙠𝙨 Once the risks are identified, analyze their potential impact and likelihood. This involves assessing: -- 𝗦𝗲𝘃𝗲𝗿𝗶𝘁𝘆: The potential consequences of each risk on the project. -- 𝗣𝗿𝗼𝗯𝗮𝗯𝗶𝗹𝗶𝘁𝘆: The likelihood of each risk occurring. 4. 𝙀𝙫𝙖𝙡𝙪𝙖𝙩𝙚 𝙍𝙞𝙨𝙠 𝙈𝙞𝙩𝙞𝙜𝙖𝙩𝙞𝙤𝙣 𝙎𝙩𝙧𝙖𝙩𝙚𝙜𝙞𝙚𝙨 Develop strategies to mitigate the identified risks. This can include: -- 𝗥𝗶𝘀𝗸 𝗔𝘃𝗼𝗶𝗱𝗮𝗻𝗰𝗲: Altering the project plan to eliminate the risk. -- 𝗥𝗶𝘀𝗸 𝗥𝗲𝗱𝘂𝗰𝘁𝗶𝗼𝗻: Implementing measures to reduce the impact or likelihood of the risk. -- 𝗥𝗶𝘀𝗸 𝗧𝗿𝗮𝗻𝘀𝗳𝗲𝗿: Shifting the risk to another party, such as through insurance or subcontracting. -- 𝗥𝗶𝘀𝗸 𝗔𝗰𝗰𝗲𝗽𝘁𝗮𝗻𝗰𝗲: Acknowledging the risk and preparing to manage its impact if it occurs. 5. 𝙈𝙤𝙣𝙞𝙩𝙤𝙧 𝙖𝙣𝙙 𝙍𝙚𝙫𝙞𝙚𝙬 Continuously monitor the project for new risks and review the effectiveness of the risk mitigation strategies. #risk #riskmanagement #riskmanager #construction #planning #planningmanager #cost #saudi #saudiarabia #ksa #projectcontrols #projectmanagement #pmp #rmp #pmo #amrhegazy