Various Types of Contracts | Type of Civil Engineering Contract
Hello, Quantity Surveyor, The following are the various types of contracts, for execution of civil engineering works.
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| Various Types of Contracts | Type of Civil Engineering Contract |
1. Item rate contract
2. Percentage rate contract
3. Lumpsum contract
4. Labour contract
5. Materials supply contract
6. Piece-Work agreement
7. Cost plus percentage rate contract
8. Cost plus fixed fee contract
9. Cost plus fluctuating fee contract
10.Target contract
Item rate contract
For this contract, contractors are required to quote rates for individual items of work on the basis of schedule of quantities furnished by the client’s department.Percentage rate contract
In this form of contract, the client’s department draws up the schedule of items according to the description of items sanctioned in the estimate with quantities, rates, units and amounts shown therein.Lump sum contract
In this form of contract, contractors are required to quote a fixed sum (lump sum amount) for execution of a work complete in all respects i.e., according to the drawings, design and specifications supplied to them with the tender within the specified time.Labour contract
This is a contract where the contractor quotes rates for the item work exclusive of the elements of materials which are supplied by the client’s Department.Materials supply contract
In this form of contract, the contractors have to offer their rates for supply of the required quantity of materials , inclusive of all local taxes, carriage and delivery charges of materials to the specified site within the time fixed in the tender.Piece-Work agreement
As the name signifies the piece-work agreement, it is that for which only a rate is agreed upon without reference to the total quantity of work to be done or the quantity of work to be done within a given period.Cost plus percentage rate contract
In tendering for work on a “Cost Plus” basis, the contractor is paid the actual cost of the work, plus an agreed percentage in addition, to allow for profit.Cost plus fixed fee contract
In this type of contract, the contractor is paid by the owner an agreed lump-sum amount over and above the actual cost of work.Cost plus Fluctuating Fee contract
In this type of contract, the contractor is paid by the owner the actual cost of construction plus an amount of fee inversely variable according to the increase or decrease of the estimated cost agreed first by both the parties.Target Contract
This is the type of contract where the contractor is paid on a cost-plus percentage work performed under this contract. In addition, he receives a percentage plus or minus on savings or excess effected against either a prior agreed estimate of total cost or a target value arrived at by measuring the work on completion and valuing at prior agreed rates.
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item rate contract, percentage rate contract, lump sum contract, labour contract, materials supply contract, piece-work agreement, cost plus percentage rate contract, cost plus fixed fee contract, cost plus fluctuating fee contract, target contract
I think we all should be more aware of the different types of contracts. This is very helpful, thanks!
ReplyDeleteVery important to know various types of contracts and the very basic knowledge of each one of them. When needed to work practically the concept should be clear. Thank-you for sharing.
ReplyDeleteOh, what a crisp explanation to each of the contract types! Thanks for this! Helpful.
ReplyDeleteDifferent kinds of contracts? Wow this is learning very helpful post!
ReplyDeleteThis is so informative. I'm a nurse so it's interesting to see another profession's perspective.
ReplyDelete