One of the concerns of employers in the pre-construction period is the potential leverage of the preferred contractor to increase the amount of the contract or renegotiate the conditions of execution of the work. To deal with this problem, the parties agree, in the details of the PCSA, to the criteria on which the contractor must submit its second tender offer, including the form of the work contract (including possible modifications) that must be concluded. On the one hand, an PPE is useful for cost management. While an offer can pay off, an EPI allows for a more accurate estimate of costs, better decision-making and a detailed budget. It also increases transparency in project costs in terms of labour and equipment costs. With such discoveries, an owner can knowingly make good decisions with his builder and his team. If you`re building a $5 million house, you want all the details of the cost – to find out what you`re paying for – and the EPI cans it. Elsewhere, there are standard obligations in terms of address and maintenance, prohibited equipment, insurance, confidentiality and collaboration with the project team. The copyright license is without means of payment. However, the PCSA does not include construction work, as they are generally project-specific and must be flexible to work either in traditional markets or in design and construction markets under different circumstances.
In recent years, pre-construction service agreements (“PCSAs”) have been commonplace in construction projects. Until recently, all of these agreements were custom documents, but the JCT has now published two standard PCSAs. This article examines: a well-written letter of intent gives the employer and the contractor a legal framework in which the contractor can start (and be paid). In addition, the employer generally only agrees to pay for this work until a certain amount is reached until the final agreement of the construction contract is reached. General JCT PCSA does not cover this possibility, but the JCT PCSA specialist is the developer`s vehicle for ordering and allows the benefit of the agreement to be awarded to the selected primary contractor. Note, however, that it is the transfer of the benefit, not the charge, i.e. the payment obligations would remain with the developer. Inevitably, there will be projects for which two-stage tendering will not be appropriate. While the guidelines state that it can be adapted to a project management structure, the need for a pre-construction phase could hinder the objective of this procurement strategy, namely the rapid start of work. Similarly, for projects where employers have a finalized project capable of identifying potential risk areas, employers can accurately predict the expected amount of the contract without having to spend time and expense on a two-step tender. A problem in most contractual relationships is the extent of a party`s liability after the conclusion of services or work. Most work contracts and consulting appointments for essential projects are carried out as acts requiring a 12-year time limit for claims.
It seems logical that a PCSA should follow the same principle, but the JCT-PCSAs do not provide for enforcement as acts. In addition to the resulting discrepancies, this will result in an anomaly in which the specialized version of the PCSA was used for early orders and will then be assigned to the main contractor. This problem is often addressed in tailored agreements, providing in the main construction contract to subsume all the services provided during the construction period and thus create a single contract covering all the deliberations and work carried out by the contractor. Given what many describe as the obvious benefits of an ASP, it is possible to think that the use of a statement of intent is always a negative step. It is certainly not a good practice to seek a statement of intent as a reflex reaction. However, the parties to a statement of intent may have good reason to