SUBCONTRACT AGREEMENT

AND

PROVISIONS OF SUBCONTRACT

THIRD EDITION (2003)

_____________

Incorporating:

GENERAL CONDITIONS OF SUBCONTRACT 2003

for use in connection with

SUBCONTRACT WORKS OF CIVIL ENGINEERING CONSTRUCTION

with Annexure, Appendix, Schedule and

Forms of Tender, Agreement, Guarantee and Final Certificate

__________

The South African Federation of Civil Engineering Contractors

has approved this document and it is recommended for general use

Copies are obtainable from the Federation Offices, Construction Centre,

12 Skeen Boulevard, Bedfordview or P.O. Box 644, Bedfordview, 2008
or on enquiry to [email protected]
tel : 011 409 0900

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 EXPLANATORY MEMORANDUM

The principles of the General Conditions of Subcontract 2003 are:

A. The Subcontractor should observe, perform and comply with the provisions of the Main Contract in so far
as they relate or apply to the Subcontract and are not inconsistent with the provisions of the Subcontract.

B. In the interpretation of the provisions of the Main Contract, in so far as they relate or apply to the
Subcontract, the Contractor has like powers, rights and responsibilities in relation to the Subcontract as
the Employer and/or Engineer and/or the Employer's or Engineer's duly appointed agent has in relation to
the Main Contract; and the Subcontractor has like powers, rights and responsibilities in relation to the
Contractor as the Contractor has in relation to the Employer and/or Engineer and/or the Employer's or
Engineer's duly appointed agent.

C. There is no privity of contract between the Subcontractor and the Employer and the Subcontractor should
undertake to the Contractor like obligations and liabilities as are undertaken by the Contractor to the
Employer in terms of the Main Contract; and the Subcontractor holds harmless and indemnifies the
Contractor in respect of the performance of such obligations and liabilities. The Subcontract makes
provision for a Subcontract penalty in the event of late completion.

D. The terms of the Main Contract as they apply to the Subcontractor, and the terms of the Subcontract,
which influence the Subcontractor's price and assessment of risk, are to be clearly and concisely stated
at tender stage and should not be unilaterally imposed at a later stage.

The parties should complete the following pages:

By the Contractor when inviting Sub- By the Subcontractor when submitting

Contract Tenders: his offer:

1. Front Page .............. Page 2 1. Annexure B...................... Page 9

2. Annexure A ............ Page 8 2. Appendix Part II .............. Page 11
3. Appendix Part I ...... Page 10 3. Schedule Part II ............... Page 13
4. Schedule Part I ........ Page 13 4. Form of Subcontract Tender Page 15

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 PROVISIONS OF SUBCONTRACT

between (The Contractor) :

.....................................................................................................................................................................

...........................................................................................................................................................................
................

and (The Subcontractor) :

.....................................................................................................................................................................

...........................................................................................................................................................................
.......

for the following works (The Subcontract Works) :

.....................................................................................................................................................................

...........................................................................................................................................................................
........

...........................................................................................................................................................................
........

Incorporating:

GENERAL CONDITIONS OF SUBCONTRACT 2003

FOR USE IN CONNECTION WITH SUBCONTRACT WORKS OF

CIVIL ENGINEERING CONSTRUCTION

and further:

Annexure A: Special Conditions of Subcontract

Annexure B: Alterations by Subcontractor
Appendix: Appendix in Respect of Subcontract
Part I: To be filled in by the Contractor
Part II: To be filled in by the Subcontractor
Schedule: Provisions of Main Contractor to apply to Subcontract
Part I: To be filled in by the Contractor
Part II: To be filled in by the Subcontractor
Form of Subcontract Bond
Form of Subcontract Tender
Form of Subcontract Agreement
Form of Subcontract Completion/Final Certificate
Proforma Retention Money Guarantee

2
 General Conditions of Subcontract 2003
1. MAIN CONTRACT

This Subcontract shall be supplemental to an Agreement made or deemed to have been made as defined in the
Schedule hereto and for the purpose of this Subcontract such Agreement shall hereinafter be called the Main
Contract.

2. GENERAL

2.1 The Subcontractor acknowledges that he has been given reasonable opportunity of inspecting the
provisions of the Main Contract in so far as they relate or apply to this Subcontract and he shall be
deemed to be fully informed regarding those provisions. The Contractor shall, if so requested by the
Subcontractor, provide the Subcontractor with a true copy of the Main Contract, except the detailed
prices of the Contractor included in the Schedule of Quantities and the Schedule of Rates and Prices (if
any).

2.2 The Subcontractor shall observe, perform and comply with the provisions of the Main Contract in so far
as they relate or apply to this Subcontract and are not inconsistent with the express provisions of this
Subcontract as if the same were severally set out herein. In the event of any inconsistency the express
provisions of this Subcontract shall take precedence over the provisions of the Main Contract.

2.3 In the interpretation of the provisions of the Main Contract in so far as they relate or apply to this
Subcontract, the Contractor shall have like powers, rights and responsibilities in relation to this
Subcontract as the Employer and/or Engineer and/or the Employer's or Engineer's duly appointed agent
has in relation to the Main Contract and the Subcontractor shall have like powers, rights and
responsibilities in relation to the Contractor as the Contractor has in relation to the Employer and/or
Engineer and/or the Employer's or Engineer's duly appointed agent.

2.4 Nothing herein shall be construed as creating any privity of contract between the Subcontractor and the
Employer.

2.5 With respect to the Subcontract Works as covered by this agreement the Subcontractor undertakes to
the Contractor the like obligations and liabilities as are undertaken by the Contractor to the Employer in
terms of the Main Contract and holds harmless and indemnifies the Contractor from and against the
same and from all claims, demands, proceedings, damages, costs, charges and expenses whatsoever
arising out of or in connection with any failure to perform such obligations or to fulfil such liabilities and,
without limiting the generality of the foregoing, the Subcontractor holds harmless and indemnifies the
Contractor from and against:
2.5.1 faulty design of the Subcontract Works if and where such design is the responsibility of the
Subcontractor;
2.5.2 faulty materials, faulty workmanship or failure of the goods if and where the goods were manufactured
and/or supplied by the Subcontractor;
2.5.3 any negligence by the Subcontractor, his agents, workmen and servants;
2.5.4 any misuse by the Subcontractor of any construction plant, temporary works or materials provided by the
Contractor for the purposes of this Subcontract.

2.6 The Subcontract Works shall mean the works described in the Appendix hereto.

2.7 The Subcontract Price shall mean the tendered sum and/or rates named in the Subcontract tender as
payable to the Subcontractor subject to such additions thereto or deductions there from as may be made
from time to time under the provisions of this Subcontract.

2.8 If not otherwise agreed between Contractor and Subcontractor, the Subcontract Price shall be increased
or decreased in accordance with the Contract Price Adjustment Formula or other price adjustment
arrangements of the Main Contract using the particulars specified in the Appendix hereto.

3. ADMINISTRATIVE MATTERS

The Contractor hereby warrants that the Subcontractor shall be given reasonable notice of and be entitled to
attend any meeting, which in any way affects the interests of the Subcontractor. The Contractor further
warrants that the Subcontractor shall be given:
3
 (a) extracts of the minutes of any such meeting regardless of whether the Subcontractor attended the
meeting or not;
(b) reasonable notice of the Contractor's intention to present any claim to the Employer in respect of
quantities which relate to the Subcontract Works or any claim which affects the interests of the
Subcontractor in any other way;
(c) the opportunity to present any claim as aforesaid jointly with the Contractor;
(d) details of any claim as aforesaid presented to the Employer and the results of any such claim.

4. ASSIGNMENT AND SUB-LETTING

4.1 Neither the Subcontractor nor the Contractor shall cede or delegate his rights or obligations in respect of
the whole or any part of this Subcontract.

4.2 The Subcontractor shall not sublet the whole or any part of the Subcontract Works without the prior
written consent of the Contractor, which consent shall not be unreasonably withheld.

5. SUBCONTRACT SURETIES

The Subcontractor shall provide the Contractor with the sureties to the amount stated in the Appendix hereto
and in the form as attached hereto within 14 (fourteen) days after the award of the Subcontract.

6. INSURANCES

6.1 The Contractor shall insure the Subcontract Works against all risks other than the excepted risks
specified in the Main Contract and to the full value of such Subcontract Works to be executed from time
to time subject to the exclusions from such risks and the deductible amount stated in the Appendix
hereto. To the extent to which the Subcontract Works are not covered by the policy or policies of
insurance taken out by the Contractor, any loss or damage thereto from whatever cause arising other
than the aforesaid excepted risks, shall be the sole responsibility of the Subcontractor until the date of
completion of the Subcontract Works.
At his written request, the Subcontractor shall prior to the commencement of the Subcontract Works, be
given reasonable opportunity of inspecting such policy or policies or be provided with a copy of such
policy or policies. If the Contractor fails to comply with such request, the Subcontractor shall have no
responsibility whatsoever for the Subcontract Works in terms of this clause until his request has been
complied with. The Subcontractor shall observe and comply with the conditions of the policy or policies
of insurance affected in terms hereof.

6.2 Unless insured in terms of the provisions of Sub-Clause 6.1 hereof, the Subcontractor shall insure the
following in the same manner as the Contractor is required to insure in accordance with the provisions of
the Main Contract.
6.2.1 the temporary works installed from time to time by the Subcontractor for his use, to their full value, until
no longer required by the Subcontractor;
6.2.2 the materials, construction plant and other things brought on to the Subcontract site by the
Subcontractor, to their full value.

6.3 The Subcontractor shall insure against such risks as are stated in the provisions of the Main Contract
and which may arise out of or in consequence of this Subcontract in respect of:
6.3.1 The Compensation for Occupational Injuries and Diseases Act (Act 130 of 1993) or any other statute in
force for the time being or any other legal liability in respect of any accident or injury to any
workman or other person in the employment of the Subcontractor;
6.3.2 any accident, injury, damage or loss to any person or property under Third Party or Public Liability to the
minimum amount stated in the Appendix hereto.

7. DAMAGE TO PROPERTY

The Subcontractor shall indemnify the Contractor against claims, losses or proceedings arising from damage to
the sub-surface and/or hidden installations and services which have been adequately indicated on site and are
shown on drawings supplied to the Subcontractor.

8. COMMENCEMENT AND PROGRAMME

8.1 The Subcontractor shall commence the Subcontract Works within the period stated in the Appendix
hereto after receipt by him of an order in writing to this effect delivered by hand, registered post, facsimile

4
 transmission or email and shall proceed with the same with due expedition and without delay except as
may be expressly sanctioned or ordered by the Contractor or be wholly beyond the Subcontractor's
control. The Subcontractor shall be allowed uninterrupted and continuous working except as may be
indicated in the agreed programme for the execution of the Subcontract Works.

8.2 Unless otherwise agreed, the Subcontractor shall not later than 14 (fourteen) days after the award of the
Subcontract submit to the Contractor for his approval a programme for the execution of the Subcontract
Works and the Contractor shall approve such programme prior to commencement of the Subcontract
Works, or not later than 14 days after the date of submission of the programme, whichever is sooner.
After the said programme has been approved it shall be initialled and dated by both parties and shall
form part of this Subcontract. The programme may be used to determine the Subcontractor’s
entitlement, if any, to extensions of time to the construction period of the Subcontract Works arising out
of delays thereto. In the event of the Contractor, without good cause, not approving and signing the
programme by due date, the said programme shall be deemed to form part of the Subcontract as if it had
been approved and signed by the Contractor. The parties may mutually agree on revisions of the
programme from time to time without prejudice to their rights under the first-mentioned approved
programme.

8.3 The Subcontractor shall indicate in his programme the dates upon which the Contractor shall provide the
facilities, services and goods described in the Appendix hereto to enable the Subcontractor's programme
to be met. If the Contractor shall fail to provide such facilities, services and goods timeously to enable
the Subcontractor's programme to be met, the Subcontractor shall be entitled to provide the same by his
own workmen or by others and to be paid a reasonable remuneration in respect thereof, without
prejudice to his other rights under this Subcontract.

9. TIME FOR COMPLETION

9.1 The whole of the Subcontract Works shall be completed within the Time for Completion stated in the
Appendix and/or in accordance with the agreed programme between Main Contractor and Subcontractor
calculated from the date of receipt by the Subcontractor of the order in writing in terms of Sub-Clause 8.1
hereof or from the date for commencement provided for in terms of Sub-Clause 8.1 hereof or within such
extended time as may be allowed or may be provided for in terms of Sub-Clause 9.2 hereof, subject to
any requirement in the Appendix hereto as to the completion of any section of the Subcontract Works
before completion of the whole.

9.2 If the Subcontractor shall be delayed in the execution of the Subcontract Works:
9.2.1 by any circumstance or occurrence (other than a breach of this Subcontract by the Subcontractor)
entitling the Contractor to an extension of his time for completion of the Works under the Main
Contract;
9.2.2 by the ordering of any variation of the Subcontract Works to which Sub-Clause 9.2.1 hereof does
not apply;
9.2.3 by any breach of this Subcontract by the Contractor;

then in any such event the Subcontractor shall, without prejudice to this Subcontract, be entitled to such
extension of the Time for Completion as may in all circumstances be fair and reasonable, provided
always that in any case to which Sub-Clause 9.2.1 or 9.2.2 hereof applies, it shall be a condition
precedent to the Subcontractor's right to an extension of the Time for Completion that he shall have
given written notice to the Contractor of the circumstance or occurrence which is delaying him. Provided
that if any case to which clause 9.2.1 hereof applies, the Subcontractor shall give written notice to the
Contractor of the circumstances or occurrence which is delaying him within 21 days of such delay first
occurring. Failure on the part of the Subcontractor to fulfil this condition shall not affect his entitlement to
extension of time if the Contractor should have been reasonably aware of the delay or have claimed for
extension of time in terms of the Main Contract for the particular circumstances or occurrence.

9.3 None of the permanent Subcontract Works shall be performed on any of the special non-working days
stated in the Appendix hereto, or outside normal working hours as defined in the Main Contract, except
with the prior written consent of the Contractor.

10. PENALTY FOR DELAY

10.1 If the Subcontractor shall fail to complete the Subcontract Works or sections thereof within the Time for
Completion prescribed in terms of Sub-Clause 9.1 hereof or the extended time allowed or provided for in
terms of Sub-Clause 9.2 hereof, then the Subcontractor shall pay to the Contractor the sum stated in the
Appendix hereto as a penalty for every day which shall elapse between the expiry of the aforesaid Time
for Completion or extended time as provided for herein and the date of completion of the Subcontract

5
 Works. The Contractor may deduct the amount of the penalty from any monies owing to the
Subcontractor in terms of this Subcontract Agreement.

10.2 The imposition of such penalty shall not relieve the Subcontractor of his obligation to complete the
Subcontract Works or from any of his obligations and liabilities under this Subcontract.

10.3 If before the completion of the whole of the Subcontract Works any portion of the Subcontract Works has
been approved or occupied by the Contractor and/or Employer the penalty for delay shall for any period
of delay after such approval or occupation be reduced in the proportion which the value of the portion so
approved or occupied bears to the value of the whole of the Subcontract Works, unless otherwise
provided for by the Contractor in the Appendix hereto.

10.4 The Subcontractor shall be entitled to be paid the amount set out by him in the Appendix hereto for any
delays occasioned to the Subcontractor through the breach of the Subcontract by the Contractor, without
prejudice to any of the Subcontractor's other rights.

11. MAINTENANCE AND DEFECTS

11.1 The Defects Liability Period in respect of the Subcontract Works shall be stated in the Appendix hereto
and shall be calculated from the date of practical completion of the Subcontract Works when the
Subcontract Works or parts thereof have reached a stage which allows their use for the intended purpose
without danger or undue inconvenience or from the date stated in the Appendix. The date of completion
of the Subcontract shall be the date of issue of the Certificate of Completion for the Subcontract Works
issued by the Contractor in accordance with clause 16 hereof.

11.2 If the Subcontractor, within a reasonable time of receipt of written notice from the Contractor, fails to
make good any defect or omission in the Subcontract Works required by the Contractor and for which the
Subcontractor is responsible, the Contractor shall be entitled to recover from the Subcontractor the cost
of carrying out such work.

12. VALUATIONS AND PAYMENTS

12.1 The Subcontractor shall submit to the Contractor on a date and in a form that the Contractor may
reasonably require a monthly statement of the amount he claims in accordance with the provisions of this
Subcontract and the provisions of the Main Contract.

12.2 Unless stated otherwise in the Appendix, the Contractor shall pay to the Subcontractor by the 37th
(Thirty-seventh) day (due date) or within 2 working days of the Contractor receiving payment, which ever
is the sooner, after the submission of the monthly statement referred to in Sub-Clause 12.1 hereof the
amount of the valuation made by the Contractor in accordance with the provisions of this Subcontract
and the Main Contract less the percentage retention stated in the Appendix hereto subject to the limit of
Subcontract retention money stated in the Appendix hereto.

12.3 If part of the Subcontractor's claim is in dispute the amount not in dispute shall be paid to the
Subcontractor in accordance with the provisions of this Subcontract, and any patent errors or omissions
that may be discovered by the Contractor shall not be cause for delay in payment of the adjusted
amount.

12.4 Without prejudice to his rights under this Subcontract or any right he may have to determine this
Subcontract, the Subcontractor from due date shall be paid interest upon overdue payments calculated
on daily balances at a rate per annum equivalent to 2% (two per centum) plus the prime rate current on
the date upon which such payment first becomes overdue, but such interest shall not exceed the legal
maximum rate. In the event of any variation in the said overdraft rate whilst such payment remains
overdue the interest payable for the period that such payment remains overdue shall be correspondingly
varied from the date of each such variation.

12.5 When the Subcontractor is expressly required to undertake a continuing obligation beyond the date of the
final certificate in respect of the Subcontract Works and gives an indemnity as set out in the Appendix
hereto to the satisfaction of the Contractor against any defect, no monies shall be withheld beyond the
date of such final certificate.

12.6 If, as stated in the Annexure, a Retention Money Guarantee is permitted and the Subcontractor elects to
furnish it, the guarantee shall, at the cost of the Subcontractor, be executed by a Bank or Insurance
Company in a form approved by the Contractor and shall be accepted in lieu of retention money until the
aggregate of the retention monies which would, but for the guarantee, have been retained by the

6
Contractor is equal to the aggregate liability of the Bank under the guarantee, whereafter the remaining
portion of the retention money shall be retained by the Contractor as provided in Clause 12.2

7
 13. DETERMINATION

Should the Contractor's employment under the Main Contract be determined for what ever reason, the
Subcontractor's employment under this Subcontract shall thereupon also determine.

14. CLAIMS

Notifications and claims procedures shall follow the provisions of the Main Contract Agreement.

15. SETTLEMENT OF DISPUTES

15.1 If any dispute or difference shall arise between the Subcontractor and the Contractor, either during the
progress or after the completion of the Subcontract Works, or after the determination of the employment
of the Subcontractor under this agreement, as to the construction of this agreement, or as to any manner
or things arising thereunder, in the first instance an attempt shall be made to settle the dispute amicably.
Should all attempts to settle the dispute or difference amicably fail, such dispute or difference shall be
referred to the appointed representative of the Contractor, or the Contractor’s site agent if no
representative is appointed, for his determination by written decision to the Subcontractor. The said
decision shall be delivered within 14 days of the date of request and shall be final and binding upon the
parties unless the Subcontractor, within 14 days of receipt thereof, by written notice to the Contractor
disputes the decision, in which case the matter shall be referred to a mediator. Should the Contractor’s
representative or site agent fail to deliver his decision within 14 days he shall be deemed to have given a
decision rejecting the Subcontractor’s contentions or claims. The mediator shall be appointed by
agreement of the parties failing which by the President of the South African Federation of Civil
Engineering Contractors upon request of the Subcontractor.

15.2 The opinion of the mediator shall be final and binding upon the parties for all disputes involving less than
R500 000. For disputes involving amounts in excess of R500 000, should one of the parties, within 28
days of receipt of the opinion, express to the other in writing their dissatisfaction with the opinion, then
that party may take the matter to arbitration, provided arbitration proceedings are instituted within a
further 28 days. The opinion of the mediator shall take immediate effect and shall be maintained until
such time as it may be overturned by arbitration.

15.3 If the matter is referred to arbitration, as described in the aforegoing, the arbitrator shall be a person
agreed upon by the parties or, failing such agreement, appointed by the Chairman of the South African
Association of Arbitrators upon the application of either party. Any such reference shall be deemed to be
a submission to a single arbitrator in terms of the Arbitration Act (Act No. 42 of 1965 as amended) or any
legislation passed in substitution therefore. The arbitration shall be conducted in accordance with the
current rules for the conduct of arbitration as published by the South Africa Association of Arbitrators.

16. COMPLETION OF THE SUBCONTRACT WORKS

16.1 When the whole of the Subcontract Works have been substantially complete and have satisfactorily
passed any tests prescribed by the Subcontract, the Subcontractor may give notice to that effect to the
Contractor together with a written undertaking to finish with due expedition any outstanding works during
the maintenance period. Within 14 days of receipt of such notice and undertaking, the Contractor shall
issue a Certificate of Completion in respect of the Subcontract Works were substantially completed in
accordance with the Subcontract, or alternatively issue the Subcontractor a list specifying all of the work
necessary to be completed before the issue of such a certificate. The Contractor shall issue a
Completion Certificate within 14 days of the completio0n, to his satisfaction, of the works specified. The
works shall be deemed to be complete upon completion of the works specified if the Contractor, without
good cause recorded in writing to the Subcontractor, fails to issue the Completion Certificate within the
period stipulated.

16.2 When this Subcontract Agreement provides for handing over the Subcontract Works in parts, or when
the Contractor or his Employer takes beneficial occupation of the Subcontract Works, a Completion
Certificate shall be issued in respect of that part of the Subcontract Works prior to it being taken over or
occupied.

16.3 The maintenance period stipulated in the Appendix shall commence upon the date of substantial
completion as stated in the Certificate of Completion and one half of the retention monies shall be paid to
the Subcontractor not late than 14 days after the expiry of the maintenance of the Subcontract Works.

16.4 If a performance bond was provided by the Subcontractor, it shall be released within 14 days of the date
of the Completion Certificate for the whole of the Subcontract Works.

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 17. INDEPENDENT CONTRACTOR

Notwithstanding the provisions of section 200A of the Labour Relations Amendment Act, 2002, the
Subcontractor warrants that he is an independent contractor, even though the Main Contractor may be the only
entity for whom he has work.

All work carried out will be entirely under the control of the Subcontractor, except where it may be limited by the
works of the Main Contractor

9
10
 ANNEXURE A
Special Conditions of Subcontract
(Alterations by Main Contractor)
NOTE: 1. This Annexure shall be completed by the Main Contractor before inviting tenders.

2. Where there are no such Special Conditions of Subcontract, the Schedule hereunder is to be
marked NIL by the Main Contractor.

The Main Contractor undertakes that the only variation from the General Conditions of Subcontract are as set
out hereunder, or alternatively as set out in the document attached hereto, marked "Special Conditions of
Subcontract", as referred to hereunder:

Page Clause

Date: ………………………………………………

.........................................................................................
....
Signature of Main Contractor

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 ANNEXURE B
Alterations by Subcontractor
NOTE: 1. This Annexure shall be completed by the Subcontractor and shall form part of his Tender.

2. Should the Subcontractor desire to make any departure from or modifications to the General
Conditions of Sub- Contract, Special Conditions of Subcontract, Specifications, Schedule of
Quantities or Drawings, or to qualify his tender in any way, he shall set out his proposals
clearly hereunder or, alternatively state them in a covering letter attached to his tender and
referred to hereunder, failing which the tender will be deemed to be unqualified.

3. If no departures, modifications or qualifications are desired, the Schedule hereunder is to be

marked NIL by the Subcontractor.

Notwithstanding any provision contained in the tender documents to the contrary, this Subcontract Tender is
subject to the following conditions which shall be deemed to be expressly included in any Subcontract
Agreement resulting from the acceptance of this Tender.

Page Clause

Date: …………………………………………………

....................................................................................
...
Signature of Subcontractor

12
 APPENDIX PART I

Appendix in respect of Subcontract

NOTE: 1. Part I shall be filled in by the Main Contractor before inviting tenders.
2. Part II shall be filled by the Subcontractor and the completed Appendix shall
form part of his Tender.
3. Items which are not applicable shall be marked NIL.

Clause

Description of Subcontract Work… 2.6 ..................................................................................................

………………………………… ............
……………………………………………………………………..
Subcontract Price Adjustment: 2.8 .
(i) Contract Price Adjustment ..................................................................................................
Factor for Civil Engineering Work ............
……………………….
x = …........ a = ............. b = .............. c = ............. d = ............

and/or The Labour Index shall be ...........

…............................................
The Plant Index shall
be ................................................................
(ii) Other Price Adjustment Arrangement (to be set our The Material Index shall
here or attached hereto as here referred to) 5. be ..........................................................
…………………………………... The Fuel Index shall
be .................................................................
Amount of Subcontract 6.1
Surety……………………………………….. ……………………………………………………………………..
6.1 .
Exclusions (other than excepted risks) from All Risks ……………………………………………………………………..
Insurance of Subcontract .
Works…………………………………………………… 6.3
R ..............................................................................
Deductible Amount on All Risks Insurance of Subcontract or ......................
Works 8.1 per cent of Tendered Sum and/or Rates.

Minimum Amount of Third Party or Public Liability Insurance of ..................................................................................................

Subcontract.................................................................................. 8.1 ..................................................................................................
... ........................
R...............................................................................................
Period within which or date by which Subcontract Works to be ............
commenced................................................................................. 8.3
..
R...............................................................................................
Details of discontinuity of Subcontract Works not provided for ............
in the Main
Contract………………………………………………………
9.1 ........................... days/ ...................................................
Facilities, Services or Goods to be provided by the Main (date)
Contractor to the Subcontractor................
……………………………… ..................................................................................................
9.3 .....
..................................................................................................
10.1 .....
Time for 10.3
Completion………………………………………………….
11.1 Free of charge: ...…………...........…….
(i) Time for Completion of Subcontract ………………...................
Works ............................. as Specified: .....…………………………………......
(ii) Time for Completion of Sections of the Subcontract 12.1
Works . 12.2 …..................
12.2 .....................................…………….....................
12.2 ……………...........

Special Non-Working
days .............................................................
12.6 …………. days/months
Amount of Subcontract Section ...................................................................................
......
13
Penalty ..................................................... ...............................................................................
Will a proportional Reduction in Subcontract Penalty days/months
apply......... Section ...................................................................................
......
Defects Liability ...............................................................................
Period .................................................................... days/months
......................................................... (Statutory Public
Holidays)
Percentage Advance on Unused ..................................................................................................
Materials ...................................... .....
Time for R ...................................................................... per calendar
payment ............................................................................ day
Percentage Yes/No.
Retention .......................................................................
Limit of Subcontract Retention .......... months from date of completion of Subcontract
Money ........................................ Works, or alternatively .......... months from.................. (date)

Period of Validity of Subcontract ................... per cent.

Tender ...................................... ................... days.
................... per cent.
Retention Guarantee R ..............................................................................................
allowed . ......................................................... ......
(See Form of Subcontract Tender).
Date ........................................................................................... ...........................................................................................
....... days

Yes/No

..................................................................................................
.....
SIGNATURE OF MAIN CONTRACTOR

14
 Appendix PART II
(PART II to be completed by the Subcontractor)

Clause

Charges by Subcontractor for 10.4

Delays in Subcontract
Works:.........
………....................

(i) Additions to Daywork

Allowances set out below

(ii) Charge for Activity or

Section of Work delayed ..

12.5
Indemnity for Subcontract (to
be set out here or attached
hereto as here referred to)
………………….

Daywork allowances (if not

scheduled
elsewhere)....................

Supporting Details (any

particulars which the
Subcontractor considers
necessary in support of his
tender shall be set out here or
attached hereto as here
referred to)………………….

Date:
……………………………..

15
 ………… per
cent on the .............................. machine: R ..............
At Rates as remuneration of per hour
specified………………………… the workmen as
……………….. defined in the ............................. machine: R ...............
………………………………… Main Contract per hour
………………….
………… per .......................................................................
cent on the cost .......................................................................
................... per cent. of materials as .......................................................................
defined in the ..............................
R ................... per hour in Main Contract
respect of ........................
………… per
R ................... per hour in cent on hire
respect of ..................... rates for plant
and equipment
................................................ as defined in the
................................................ Main Contract
................................................ unless named
................................................ below: .......................................................................
....................................... ......
………………………………… .......................... SIGNATURE OF SUBCONTRACTOR
…………………. ...... machine: R
............ per hour

16
 Provisions of Main Contract to Apply to Subcontract
NOTE: 1. Part I shall be filled in by the Main Contractor before inviting tenders.
2. Part II shall be completed by the Subcontractor and the completed Schedule
shall form part of his Tender.
3. Items, which are not applicable, shall be marked NIL.

PART I (to be filled in by the Main Contractor)

Contract No. :
....................................................................................................................................................................

Brief Description of Main Contract Works :

...........................................................................................................................................................................
...........................................................................................................................................................................

Name of Employer :
....................................................................................................................................................................

Name of Main Contractor :

.......................................….........................................................................................................................

1. General Conditions of Main Contract:

a) The General Conditions of Contract of the Main Contract are:

..................................................................................................................................................
......
(identification of the applicable General Conditions of Contract)
and the Main Contractor hereby undertakes to make these General Conditions of Contract
available to the Subcontractor not later than seven days before the closing date for the
submission of this Subcontract Tender,
OR
b) The Contractor hereby nominates the following General Conditions of Contract, which for the
purpose of this Subcontract, shall be deemed to be the General Conditions of Contract of the
Main Contract:

..................................................................................................................................................
......

........................................................................................................................................................
OR
c) If the General Conditions of Contract have not been specified by the Contractor in Item 1(a) or
1(b) above or if the General Conditions of Contract specified have not been made available by
the Contractor to the Subcontractor not later than seven days before the closing date for the
submission of this Subcontract Tender, the General Conditions of Contract 1990, for Use in
Connection with Works of Civil Engineering Construction shall be deemed for the purpose of
this Subcontract to be the General Conditions of Contract of the Main Contract.

2. Special Conditions

Special Conditions of Main Contract to Apply to Subcontract:

....................................................................................................................................................................
.......

....................................................................................................................................................................
.......
17
18
3. Specification:

Portions of Specification of Main Contract to Apply to Subcontract Works:

....................................................................................................................................................................
......

....................................................................................................................................................................
......

4. Drawings:

Drawings of Main Contract to Apply to Subcontract Works:

....................................................................................................................................................................
.......

....................................................................................................................................................................
.......

5. Other Aspects:

Other Aspects of Main Contract to Apply to Subcontract Works:

....................................................................................................................................................................
.......

..........................................................................................................................................................................
6. Undertaking:

The Main Contractor hereby undertakes to make the documents specified in Items 2 to 5 above available
to the Subcontractor not later than seven days before the closing date for the submission of this
Subcontract Tender, failing which the Subcontractor shall not be bound thereby.

Date: ………………………… ........................................................................................................

SIGNATURE OF CONTRACTOR

PART II (to be filled in by the Subcontractor)

Availability of the Main Contract:

The Subcontractor hereby states that the following documents were made available to him not later than seven
days before the closing date for the submission of this Subcontract Tender:

the General Conditions of Contract specified in Item 1 above,

the Special Conditions of Contract specified in Item 2 above,
the Specification specified in Item 3 above,
the Drawings specified in Item 4 above,
the Other Aspects specified in Item 5 above.
(delete whichever was not made available)

Date: ………………………….
................................................................................................................
19
 SIGNATURE OF SUBCONTRACTOR

Form of Subcontract Guarantee

(Surety to be provided within 14 days after the award of the Subcontract)

We, the undersigned

..................................................................................................................................................................

Of
………………………………………………………………………………………………………………………………

undertake to pay [Name of Main Contractor] (the Beneficiary) the sum of R[Amount in figures and words] (the
Guarantee Amount) on the receipt of a first written demand for payment from the Beneficiary stating that the
amount is due and payable by the Subcontractor in terms of the Subcontract Agreement between the Main
Contractor and the Subcontractor.

Our liability under this guarantee is principal in nature and is not subject to any agreement. Our liability shall
not be reduced or in any way affected by any alteration of the terms of the Subcontract, or any other
agreement made between the Main Contractor and the Subcontractor.

We will pay on demand and will not determine the validity of the demand or the correctness of the amount
demanded or become party to any claim or dispute of any nature which any party may allege.

This guarantee is neither negotiable nor transferable, is restricted to the payment of a sum of money only and
is limited to the Guarantee Amount.

This guarantee will expire on [Expiry date], or upon payment of the Guarantee Amount, whichever event occurs
first, and no further claims will be considered.

FOR AND ON BEHALF OF THE GUARANTORS

at ..................................................................................... on this ............. day of .......................................

20 ......

.....................................................................................................................................................................

AS WITNESSES:

1. ................................................................. 2. ................................................................

ADDRESS:

..................................................................... ....................................................................

..................................................................... ....................................................................

..................................................................... ....................................................................

20
21
 Form of Subcontract Tender
(Annexures A and B, the Appendix and the Schedule form part of the Tender)

Contract
No. : ..................................................................................................................................................................................
.....

Short Description of Subcontract

Works : .............................................................................................................................................

...........................................................................................................................................................................................
..................

To : ....................................................................................................................................................................................
..................

Gentlemen,

1. Having examined and, where applicable, completed the General Conditions of Subcontract, the Special Conditions
of Subcontract in Annexure A, the Appendix, the Schedule hereto, the Schedule of Quantities and the Schedule of
Rates and Prices (if any) for the execution of the above-mentioned Subcontract Works, I/we offer to construct,
complete and remedy any defects in the Subcontract Works in conformity with such aforementioned documents,
save as amended by the alterations set out in Annexure B hereto

for the sum of R……………………………………(In

words .......................................................................................................

...........................................................................................................................................................................................
.......) and/or the rates and prices stated in the Schedule of Rates and Prices or such other sum as may be
ascertained in terms of the Subcontract.
2. In the event of there being any errors of extension or addition in the priced Schedule of Quantities of the
Subcontract Works, I/we agree to their being corrected, the rates being taken as correct.
3. Unless a closing date for the submission of this Subcontract Tender has been determined by you, the closing date
shall be 12 noon on the day which is two days before the closing date of the main tender.
4. I/We agree to abide by this Subcontract Tender during the period stated in the Appendix hereto, from the date fixed
for receiving the same and it shall remain binding upon me/us and may be accepted at any time before the
expiration of that period.
5. After the submission of my/our Subcontract Tender, I/we shall only negotiate or discuss any variation, amplification,
alternative or other aspect relating to the same, provided I/we have been informed that I/we are the only tenderer
with whom you are negotiating or discussing any such variation, amplification, alternative or other aspect.
6. Unless otherwise agreed, my/our Subcontract Tender shall not be accepted in part only.
7. I/We undertake, if my/our Subcontract Tender is accepted, to commence the Subcontract Works within the period
or by the date stated in the Appendix hereto and to complete and deliver the whole of the Subcontract Works
comprised in the Subcontract within the time for completion stated in the Appendix hereto.
8. If my/our Subcontract Tender is accepted I/we will, when required and within the time stipulated, provide a
guarantee acceptable to you of an Insurance Company or Bank to be jointly and severally bound with me/us in a
sum not exceeding 10% (ten per centum) of the above named sum for the due performance of the Subcontract
under the terms of a Subcontract Guarantee in the form attached hereto. The Guarantor I/we propose are:

...........................................................................................................................................................................................
.........

...........................................................................................................................................................................................
.........

...........................................................................................................................................................................................
.........

9 Unless and until a formal Subcontract Agreement is prepared and executed, this Subcontract Tender, together with
your written acceptance thereof shall constitute a binding contract between us.
10. I/We understand that you are not bound to accept the lowest or any tender you may receive.

22
I/We am/are, Gentlemen,

Yours faithfully,

Signature…………………………………………..

on behalf of …………………………………………………………………………………………

Address………………………………………………………………………………………………

Date: ....................................................................

Form of Subcontract Agreement

This Subcontract is made and entered into

between...............................................................................................

...........................................................................................................................................................................

......

of........................................................................................................................................................................

......

(hereinafter called the Contractor) of the one part; and…………………………………………………………..

……...

………………………………………………………………………………………………………………………………...

..

of........................................................................................................................................................................

..

(hereinafter called the Subcontractor) of the other part,

SUPPLEMENTAL to an Agreement (hereinafter called the Main Contract) made or deemed to have been made

between .............................................................................................................................................................

.....................

...........................................................................................................................................................................

.......

(hereinafter called the Employer) of the one part and the Contractor of the other part,

WHEREAS the Contractor desires to have executed certain Subcontract Works,

namely................................................................................................................................................................

...........................................................................................................................................................................

...........................................................................................................................................................................

.......

which Subcontract Works form part of the Works comprised in and to be executed under the Main Contract and
has accepted a Tender by the Subcontractor for the construction, completion and remedy of defects of such
Subcontract Works;
23
NOW IT IS HEREBY AGREED AS FOLLOWS:
1. In this Subcontract words and expressions shall have the same meaning as are respectively assigned to
them in the General Conditions of the Subcontract and the General Conditions of Main Contract
hereinafter referred to.
2. The following documents shall be deemed to form this Subcontract and shall be read and construed in
the following order of precedence:
a) The Programme of Subcontract Works as and when agreed in accordance with Sub-Clause
8.2 of the General Conditions of Subcontract.
b) This Form of Subcontract Agreement.
c) The Letter of Acceptance.
d) The Form of Subcontract Tender together with the documents forming part thereof as listed
hereunder.
i) The Alterations by Subcontractor (Annexure B)
ii) The Special Conditions of Subcontract (Annexure A)
iii) The General Conditions of Subcontract
iv) The Appendix in Respect of the Subcontract
v) The Schedule of Provisions of Main Contract to Apply to the Subcontract
vi) The priced Schedule of Quantities of the Subcontract Works
vii) The Schedule of Rates and Prices (if any) of the Subcontract Works
viii) The Form of Subcontract Bond
e) The Conditions of the Main Contract together with all documents forming part thereof.
3. In consideration of the payments to be made by the Main Contractor to the Subcontractor as herein-after
mentioned the Subcontractor undertakes to the Main Contractor to construct, complete and remedy any
defects in the Subcontract Works in conformity in all respects with the provisions of the Subcontract.
4. The MainContractor hereby undertakes to pay to the Subcontractor in consideration of the construction,
completion and remedy of defects of the Subcontract Works the Subcontract Price at the time and in the
manner prescribed by the Subcontract.
5. The parties hereto choose domicilium citandi et executandi for all purposes of this Subcontract at the
respective addresses stated hereunder.

IN WITNESS WHEREOF the parties hereto have set their hands and seals (if any) in the presence of the
subscribing witnesses: Signed in the presence of the subscribing Witnesses:

AT .............................................................................................. for and on behalf of the MAIN

CONTRACTOR on this

................................................................... day of .......................................................................................

20 ......

Address ............................................................................................................................................................

................

.................................................................... SIGNATURE

AS WITNESSES:

1. ................................................................. 2. ................................................................

24
AT .................................................................................................. for and on behalf of the

SUBCONTRACTOR on this

.................................................................. day of ....................................................................................…

20 ......

Address:............................................................................................................................................................

....................................................................................

. SIGNATURE

AS WITNESSES:

1. ................................................................. 2. ................................................................

25
 Form of Subcontract Completion/Final Certificate

for use in connection with the General Conditions of Subcontract 2003

To ......................................................................................................................................................................
............
(Name of Subcontractor)

Contract No.:
...................................................................................................................................................................

Brief Description of Subcontract Works:

.....................................................................................................................................................................
...........................................................................................................................................................................
......

..........................................................................................................................................................................
....... CERTIFICATE OF COMPLETION OF THE SUBCONTRACT WORKS

This is to certify that the whole or any part of the Subcontract Works as specified hereunder has been
completed for all practical purposes in conformity with the provisions of the Subcontract and (where specified)
has satisfactorily passed any final tests:

...........................................................................................................................................................................
.......

...........................................................................................................................................................................
.......
(Description of the completed Subcontract Works)

The sum of R ........................... (in words:....................................................................................) being one

half of the retention money, is accordingly due and payable to the Subcontractor in terms of the provisions of
the Subcontract.

OR

CERTIFICATE OF COMPLETION OF MAINTENANCE OF THE SUBCONTRACT WORKS

This is to certify that the whole or any part of the Subcontract Works as specified hereunder has been
maintained to my satisfaction in conformity with the provisions of the Subcontract during the defects liability
period which has now expired:

...........................................................................................................................................................................
.......

...........................................................................................................................................................................
.......
(Description of the completed Subcontract Works)

The sum of R .......................... (in words:.....................................................................................) being the

balance of the retention money, is accordingly due and payable to the Subcontractor in terms of the provisions
of the Subcontract.

OR

FINAL CERTIFICATE

This is to certify that the whole of the Subcontract Works has been completed and (where specified)
maintained to my satisfaction in conformity with the provisions of the Subcontract.

26
 (Delete whichever is inapplicable)

Date: …………………………
.................................................................................................................
SIGNATURE OF MAIN CONTRACTOR

27
 PRO FORMA
RETENTION MONEY GUARANTEE

ISSUED TO: ........................................................................................................... (hereinafter referred to as "the Main

Contractor")

ON BEHALF OF: ....................................................................................................... (hereinafter referred to as "the

Subcontractor")
in connection with
CONTRACT NO............................................................................................................. (hereinafter referred to as "the
Subcontract")
WHEREAS the Main Contractor and the Subcontractor have agreed that the Subcontractor may provide a guarantee in
lieu of the whole or portion of the retention monies provided for under the Subcontract;
NOW THEREFORE we, the undersigned, undertake, in accordance with the following provisions, to pay to the Main
Contractor such amounts as the Main Contractor may, from time to time, demand from us.

1. Each demand by the Main Contractor shall be in writing signed by the Main Contractor and delivered to us
at ............................
....................................................................................................................................... or such other address
in ................................................................................ as we shall in writing notify the Main Contractor and shall be
accompanied by a certificate complying with Clause 2.

2. The certificate referred to in Clause 1 shall certify

(a) that the Subcontractor is in breach of his obligations under the Subcontract, and

(b) that the amount demanded, which amount the certificate shall specify,

(i) does not exceed the amount of retention monies which, but for this guarantee, would have been
retained by the Contractor in terms of the Subcontract at the date of the certificate, less the
aggregate of the amounts of retention money actually retained by the Contractor and the amounts
previously paid by us to the Main Contractor in terms thereof, and
(ii) does not exceed a genuine estimate of the cost to the Main Contractor of having the breach referred to
in paragraph (a) remedied less the aggregate of any amounts withheld by the Main Contractor
from payments due to the Subcontractor in terms of the Subcontract by reason of the breach
referred to, and any amount of retention money actually held by the Main Contractor save to the
extent that the same had been deducted from any previous demand in terms hereof.

3. We shall within ............ days after our receipt of a demand complying with the provisions of Clauses 1 and 2
make payment to the Main Contractor of the amount demanded at ............................ or at such other address in
.................................. as the Subcontractor shall in writing notify to us.

4. Subject to compliance with the provisions hereof, our liability to make the payments herein referred to shall be
unconditional and shall not be affected or diminished by any disputes, claims or counterclaims between the Main
Contractor and the Subcontractor.

5. Our aggregate liability under this guarantee is limited to

R ........................................................................................
6. This guarantee shall expire on the date on which the last of the retention monies, which but for this guarantee
would have been retained by the Main Contractor, becomes payable to the Subcontractor.
7. This guarantee is not transferable and must be produced for endorsement if any part payment is made and must
be returned to us against final payment of our aggregate liability or on the date of the expiry of the guarantee in
terms of Clause 6, whichever is the earlier.

Signed in the presence of the subscribing witnesses:

At ....................................................... for and on behalf

of ......................................................................................................

on this ................... day of ..........................................................20........

Signature………………………………………………..

Capacity…………………………………………………

Address ...........................................................................................................................................................................
...................

28
As witnesses:

1. .................................................................. 2. ..............................................................

29