I have recently been given the job of
estimating for new enquiries, including analysing the various documents. My boss has warned me to look out for
“onerous terms”. What does he mean?
My dictionary defines the word “onerous” as “causing or requiring
trouble”. Onerous terms usually occur
in the client's or builder’s own "non-standard" documents but can also arise as amendments
or "addenda" to Standard Forms.
Such terms and conditions not only cause trouble but increase the risk
placed upon the tenderer. The time to make yourself aware is before you price
the job, by means of a simple check list.
The following is a list of some key examples :
(a)
Extended payment periods
(b)
Pay when certified
(c)
Extended “fixed price” periods
(d)
Non-payment for unfixed materials
(e)
Excessive discount
(f)
Excessive retentions and/or periods.
(g)
Onerous "set-off “ clauses
(h)
Acceleration clauses without payment
(i)
Vague programme information.
(j)
Design fitness for purpose
(k)
Co-ordination with unknown “others”
(p)
Protection clauses
(q)
Client’s “milestone dates” for access
(r)
Excessive
liquidated damages
(s)
Restricted extension entitlements
(t)
Restricted loss and expense entitlements
(u)
Notice periods made “condition precedent”
(v)
Adjudication entitlements restricted or delayed
(w)
Costs of adjudication paid by subbie
(x)
Construction Act abuse generally
Having identified these onerous terms, the principal options are :
(a) Decline the enquiry
(b) qualify the tender and/or negotiate amendments
(c) price the "risk" into the tender
(d) accept the terms and "manage the risk" on site.
File 99et – 1/6/00 for July 2000 “Jack Russell”
John
Russell
Contracts
and Training Consultant
Cheshire CW4 7DP
Tel:
07770 986444
Email: swsubbie@globalnet.co.uk
Back to Jack Russell
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