Project management : The Order
Robert Merry is an independent Stone Consultant and Project Manger who also runs training courses on project management. He continues this series setting out some guiding principles for successful estimating and project management with a discussion of: The Order
Assuming the pre-contract meeting on-site I mentioned in this column last month went well, and that you can achieve the programme, and the price is agreed (after some negotiation), then the next event will probably be the arrival of the order.
Before you do anything else, read this thoroughly, including the microscopic ‘Terms and Conditions’ printed on the back.
These are usually onerous and commit you to all sorts of outrages, including ‘all payments will be on account until the final payment’ or wording to that effect. The print seems to grow smaller each year. I can only assume (as you should) that the size of the writing is designed to hide something from the reader. “Oh, you cynic,” I hear you cry – perhaps, but I am not entirely convinced saving trees is at the forefront of the Main Contractor’s mind.
The contractor will have attached your final quote to the order. Check that the figures match the figure on the front page of the order. Are the programme dates as agreed? Have you included hourly labour rates in your quote and have these been included in the order? Are the LADs (liquidated and ascertained damages) correct?
Obvious, I know, but you’d be surprised how many omissions and typos a contract can have. If they’re simple mistakes they should be initialled by both parties. If they are major, have it re-typed.
The order is an offer that you can either accept or return with a counter offer.
For example, you can write back and suggest changes to the conditions. This is a counter offer. You then wait. The contractor will probably be in contact and ask you to get on with the job and “we can sort all this out later”. This is not an agreement. Be careful.
Once you start work it will be construed that the last offer on the table is the one both parties have accepted. This could be their offer or your counter offer or their counter, counter offer… So don’t start work unless you have agreements in writing. However much the pressure increases to start, be patient. If you cannot agree terms at the beginning, what’s the chance of agreeing payments at the end?
Eventually, you will need to make a commercial decision based on the risk of how far you take the demands for changes to the contract – or if you want to enter into the contract at all. Take professional advice from a quantity surveying practice or construction solicitor.
I know work is scarce and you are now thinking I have gone completely mad and I should live in the real world. Don’t enter into the contract?
But is it worth doing work you might not be paid for it? Or, perhaps worse, be paid less than you and your bank manager expected because the terms were wrong?