If you are planning to undertake a construction project, a construction management agreement will be essential to ensure that your project runs smoothly and on time. A construction management agreement is a contract between the owner of a construction project and a construction manager. The agreement outlines the responsibilities and obligations of the parties involved and sets out the terms and conditions of the project.
Here are some of the key elements that a construction management agreement should include:
Scope of work
The scope of work outlines the work that the construction manager is responsible for. It should cover everything from pre-construction planning to project closeout. This should include site surveys, cost estimating, scheduling, procurement of materials and labor, construction supervision, quality control, and safety management.
Payment terms
The agreement should include payment terms, including the rate of payment, payment schedule, and any contingencies. The agreement may also include penalties and incentives to ensure that deadlines are met.
Responsibilities of the parties involved
The agreement should outline the responsibilities of both parties involved. The owner should be responsible for providing a suitable area for construction, obtaining necessary permits and licenses, and paying for materials and labor. The construction manager should be responsible for providing the necessary services to complete the project.
Timeframe
The agreement should specify the timeframe for completion of the project. This should include start and end dates for each phase of the project.
Change orders
The agreement should include provisions for change orders. Change orders are modifications to the original agreement, such as adding or removing work from the project. The agreement should specify how change orders will be handled, including how they will be approved and how they will be paid for.
Insurance and liability
The agreement should specify the insurance coverage required for the project. This may include general liability insurance, workers’ compensation insurance, and property damage insurance. The agreement should also specify which party is responsible for any damages or claims resulting from the project.
Dispute resolution
The agreement should include provisions for resolving disputes that may arise during the project. This may include mediation or arbitration.
In conclusion, a construction management agreement is an essential document that outlines the responsibilities and obligations of the parties involved in a construction project. It is important to have a detailed agreement in place to ensure that the project runs smoothly and on time. By including the key elements outlined above, you can be confident that your construction project will be completed successfully.