CONSTRUCTION CONTRACTS

Contracts;
A construction contract is a legal document between client and a general contractor outlining the scope,
cost and terms of a construction project.

KEY ELEMENTS;
1. Contracting Parties
2. Project Identification
3. Scope of Work
4. Payment
5. Authority
6. Change Orders
7. Schedule of Work
8. Penalties

SCOPE OF WORK;
• What work is involved in the contract
• What are the specific documents [specifications, drawings, addenda, etc.]
• Need to make sure that each and every element of the work is properly listed and specified
• When the scope of work is not clearly specified, it leave parties wide open for disagreement and
delays later on.

Contracts are (almost) always accompanied by:

1. CONSTRUCTION DRAWINGS – graphic and spatial representation of the work to be done.
2. SPECIFICATIONS – precise descriptions of products, standards, equipment, services,
construction systems, construction methods and processes, and workmanship.
3. QOUTE/ESTIMATE OF MATERIALS, BILL OF MATERIALS AND OTHER RELEVANT
DOCUMENTS

PAYMENT:
• When ang how often payment is allowed or scheduled
• How payment amounts will be calculated, including retainage, if any
• When payment will be received
• What amount of payment will be released, including retainage
• Who will authorized and approve payment
• Where payment will be received and released to you

IMPORTANT CONCEPTS FOR PAYMENT

• Substantial Completion – while not every minor detail or finishing touch may be in place,
substantial completion denotes that the project is functional and can be occupied or utilized for
its intended purpose.
o Upon achieving substantial completion, the owner typically assumes responsibility for the
property, even if certain minor tasks or corrective work remains. This milestone triggers
several important events, such as the initiation of warranty periods, the start of occupancy
permits, and the beginning of financial obligations, including the release of retainage or
the issuance of partial payment.

• Final Completion – marks the ultimate conclusion of a construction of a construction project. It

signifies that all work, including both major and minor tasks, has been finished in accordance
with the contract requirements. At this stage, all punch list items, deficiencies, and outstanding
 obligations are expected to be addresses and rectified. The project is not considered complete,
and the contractor’s scope of work is fulfilled.
o its important to note that final completion triggers crucial contractual events, such as the
release of any remaining retainage and the final payment to the contractor. It also serves
as the starting point for post-construction activities, such as facility operations and
maintenance.

AUTHORITY
• Who is the representative of the owner? How much authority does he or she have?
• What procedures are you required to follow to obtain clarifications, additional information, etc.?
• When do you have to provide notifications?
• You need to address this issue before you sign the contract and the things should run a lot
smoother during the progress of the work.

Sample excerpt:
“2.1.1 The Consultant (Name) will have authority to act on behalf of the Owner only to the extent
provided in the Contract Documents, unless otherwise modified by written agreement as provided
in paragraph 2.1.2”
“2.1.2 The duties, responsibilities, and limitations of authority of the Consultant as set forth in the
Contract Documents shall be modified or extended only with the written consent of the Owner, the
Contractor, and the Consultant.”
2.1.3 If the Consultant’s employment is terminated, the Owner shall immediately appoint or re-
appoint a Consultant against whom the Contractor makes no reasonable objection and whose
status under the Contract documents shall be that of the former Consultant.

CHANGE ORDERS
• A change order is an agreement made during the course of a job that alters one of three things:
the cost, the scope, or the schedule.
• The big misconception about change orders is that they change the work.
• They do – but that’s not really what they’re for. What a change order actually does is change the
construction agreement.
• For example - Let’s say an architect is walking on a job site and asks the carpenter if he can
replace the shoe molding.
• If the carpenter agrees, the work has changed. The carpenter has now promised to carefully
remove 80 feet of shoe molding, haul it to the landfill, buy new shoe molding, prime it, paint it,
cut it to fit, nail it down, patch and prime the heads, touch up the paint, clean up the mess, and
throw out the waste.
• But the carpenter won’t get paint for any of this extra work unless the contract is changed to
reflect it. Until the contract is changed, the shoe molding won’t show up on the schedule of
values, so it can’t be included on the pay application.
• There is no such thing as a contract that gets completed without change orders. Make certain
that the key basic elements for change orders are addressed:
o Who you have to notify and receive permission from for change order work
o When and how do you have to notify them of potential change order work
o What documents do you have to provide
o How and when the change order work will get paid
o Where the additional funds will come from for the change order work
o What is the reasonable time for approval
o How you and the owner will resolve the change order issue if immediate approval for the
work is not received in the agreed time.
Important Concept for Change Orders
- An RFI or Request for Information, is a business process used in construction to request
clarification about documents, drawings, specifications, or other project conditions. RFIs are
used to resolve information gaps, eliminate ambiguities, and capture and share specific
decisions during the course of the project.
- RFIs can be roughly classified into several different categories. These categories are:
o Design Clarifications: conflicts, incomplete plans, specifications
o Requests for a design change: often due to errors in constructions, sequencing problems
o Requests for substitutions: value engineering, material availability, ease of use
o Constructability issues
o Differing site conditions

SCHEDULE OF WORK
- The time that you planned to complete the work is important to obtaining the bottom line results
you anticipated when you bid the work. Too many contractors have given away their intended
profits because they failed to make a schedule that honestly represented the way they bid the
work. Make sure the following properly covered:
o You are not responsible for delays caused by the owner or their consultants in obtaining
the required permits, approvals, permissions, etc., to do the work
o You are not responsible for delays caused by others
o You are not responsible for "Acts of God" or inclement weather known as Force Majeure
events

Important Concept for Schedule of Work

- A Notice to Proceed is an official communication issued by contracting authorities, usually a
government entity, indicating that the contractor may begin work on a project per the terms of
the contract. It establishes a clear start date and often contains specific milestones and timelines.
This formal approval is essential since it triggers the commencement of the contract's
performance period and is a key document in the procurement process, enabling projects to
move forward into the construction or operational phase. (for Government Projects)
- Liquidated Damages***
o Liquidated damages are funds covering the costs for each day the project continues past
the agreed-upon date of completion. These funds are typically deducted from what the
owner owes the contractor for the work — eating into already thin profit margins.
- An excusable delay is a non-compensable loss of time for which the contractor will receive an
extension of time but no additional payment. Excusable delays are not the fault of either party to
the contract. Although given an extension of time, the contractor must bear the costs associated
with the delay. Since they are also absorbing time-related costs, the owner is also bearing the
consequences of the delay. Thus, each party bears its own share of the costs of an excusable
delay.
- A compensable delay entitles the contractor to both a time extension and to compensation for
the extra costs caused by the delay. Unless the contract contains an enforceable no-damages-
for-delay clause, an owner-caused delay is a compensable delay. It is also possible that some
delays that would normally be excusable only may become compensable if they flow from an
earlier compensable delay. An example is a case where an owner-caused delay resulted in
follow-on work to be performed at a time in the year when normal weather-related delays are
likely to occur, and when that work would have been completed before the inclement weather
had the owner-caused delay not occurred. In this situation, the extra costs resulting from
performing in the normal inclement weather, although ordinarily not compensable, become
compensable.
Simple Stresses
Simple stresses are expressed as the ratio of the applied force divided by the resisting area or

It is the expression of force per unit area to structural members that are subjected to external forces
and/or induced forces. Stress is the lead to accurately describe and predict the elastic deformation of
a body.

Simple stress can be classified as normal stress, shear stress, and bearing stress.
• Normal Stress develops when a force is applied perpendicular to the cross-sectional area of
the material.
• If the force is going to pull the material, the stress is said to be tensile stress and;
• Compressive stress develops when the material is being compressed by two opposing forces.
• Shear Stress is developed if the applied force is parallel to the resisting area. Example is the
bolt that holds the tension rod in its anchor. Another condition of shearing stress is when we twist
a bar along its longitudinal axis.
• Another type of simple stress is the bearing stress, it is the contact pressure between two
bodies.

Suspension bridges are good example of structures that carry these stresses. The weight of the vehicle
is carried by the bridge deck and passes the force to the stringers [vertical cables], which in turn,
supported by the main suspension cables. The suspension cables then transferred the force into the
bridge towers.

Normal Stress
Stress
Stress is the expression of force applied to a unit area of surface. It is measure in psi [English Unit] or
in MPa [SI unit]. Another unit of stress which is not commonly used is the dynes [cgs unit]. Stress is the
ratio of force over area.

Simple Stress
There are three types of simple stress namely; normal stress, shearing stress and bearing stress.
• Normal Stress. The resisting area is perpendicular to the applied force, thus normal. There are
two types of normal stresses; tensile stress and compressive stress. Tensile stress applied to
bar tends the bar to elongate while compressive stress tend to shorten the bar.

Where P is the applied normal load in Newton and A is the area in mm2. The maximum stress
in tension or compression occurs over a section normal to the load.
Strain
Simple Strain
Also known as unit deformation, strain is the ratio of the change in length caused by the applied force,
to the original length.

Where  is the deformation and L is the original length, thus  is dimensionless.

Stress-Strain Diagram
Suppose that a metal specimen be placed in tension-compression testing machine. As the axial load is
gradually increased in increments, the total elongation over the gage length is measure at each
increment of the load and this is continued until failure of the specimen takes place. Knowing the original
cross-sectional area and length of the specimen, the normal stress  and the strain  can be obtained.
The graph of these quantities with the stress  along the y-axis and the strain  along the x-axis is
called the stress-strain diagram. The stress-strain diagram differs in form for various materials. The
diagram shown below is that for a medium carbon structural steel.

Metallic engineering materials are classified as either ductile or brittle materials. A ductile material is
one having relatively large tensile strains up to the point of rupture like structural steel and aluminum,
whereas brittle materials has a relatively small strain up to the point of rupture like cast iron and
concrete. An arbitrary strain of 0.05 mm/mm is frequently taken as the dividing line between these two
classes.

PROPORTIONAL LIMIT [HOOKE’s LAW]

From the origin O to the point called proportional limit, the stress-strain curve is a straight line. This
linear relation between elongation and the axial force causing was first noticed by Sir Robert Hooke in
1678 and is called Hooke's Law that within the proportional limit, the stress is directly proportional to
strain or

The constant of proportionality k is called the Modulus of Elasticity E or Young’s Modulus and is equal
to the slope of the stress-strain diagram from O to P. Then

ELASTIC LIMIT
The elastic limit is the limit beyond which the material will no longer go back to its original shape when
the load is removed, or it is the maximum stress that may e developed such that there is no permanent
or residual deformation when the load is entirely removed.

ELASTIC AND PLASTIC RANGES

The region in stress-strain diagram from O to P is called the elastic range. The region from P to R is
called the plastic range.

YIELD POINT
Yield point is the point at which the material will have an appreciable elongation or yielding without any
increase in load.

ULTIMATE STRENGTH
The maximum ordinate in the stress-strain diagram is the ultimate strength or tensile strength.

RAPTURE STRENGTH
Rapture strength is the strength of the material at rupture. This is also known as the breaking strength.

MODULUS OF RESILIENCE
Modulus of resilience is the work done on a unit volume of material as the force is gradually increased
from O to P, in Nm/m3. This may be calculated as the area under the stress-strain curve from the origin
O to up to the elastic limit E (the shaded area in the figure). The resilience of the material is its ability
to absorb energy without creating a permanent distortion.

MODULUS OF TOUGHNESS
Modulus of toughness is the work done on a unit volume of material as the force is gradually increased
from O to R, in Nm/m3. This may be calculated as the area under the entire stress-strain curve (from
O to R). The toughness of a material is its ability to absorb energy without causing it to break.

WORKING STRESS, ALLOWABLE STRESS, AND FACTOR OF SAFETY

Working stress is defined as the actual stress of a material under a given loading. The maximum safe
stress that a material can carry is termed as the allowable stress. The allowable stress should be limited
to values not exceeding the proportional limit. However, since proportional limit is difficult to determine
accurately, the allowable tress is taken as either the yield point or ultimate strength divided by a factor
of safety. The ratio of this strength (ultimate or yield strength) to allowable strength is called the factor
of safety.

AXIAL DEFORMATION
In the linear portion of the stress-strain diagram, the tress is proportional to strain and is given by

since

To use this formula, the load must be axial, the bar must have a uniform cross-sectional area, and the
stress must not exceed the proportional limit. If however, the cross- sectional area is not uniform, the
axial deformation can be determined by considering a differential length and applying integration.
ENVIRONMENTAL IMPACT AND SUSTAINABILITY OF STRUCTURAL MATERIALS

WHY MATERIAL SELECTION MATTERS;

• Construction accounts for 11% of global CO2 emissions.
• Choosing materials impacts energy consumption, carbon footprint, and waste.
• Balancing durability, cost, and sustainability is key to eco-friendly projects.

STEEL: STRENGTH vs ENVIRONMENTAL COST

• Durability: Highly durable and recyclable
• Environmental Impact: High energy consumption during production. Carbon emissions
account for 7% of global co2 emissions.
• Recyclability: Mitigates long-term environmental cost.
• Sustainability Rating: Medium

CONCRETE: THE CARBON-INTENSIVE CHOICE

• Durability: Long lifespan, widely used in construction.
• Environmental Impact: Cement production responsible for 8% of global CO2 emissions.
• Non-Recyclable, limited by high resource extraction
• Sustainability Rating: Low to Medium

WOOD: RENEWABLE BUT FINITE

• Durability: Lower durability compared to steel or concrete but renewable.
• Environmental Impact: if sustainably harvested, a low-carbon option. Carbon sequestration
potential but deforestation risk if poorly managed.
• Biodegradable and Renewable
• Sustainability Rating: High if sourced sustainably

COMPOSITE MATERIALS: INNOVATION IN SUSTAINABILITY

• Durability: Often durable but varies by type.
• Environmental Impact: Mixed-some composites are eco-friendly, while others are energy
intensive to produce.
• Difficulty in recycling many composites (e.g., fiberglass)
• Sustainability Rating: Medium

RECYCLED MATERIALS: THE FUTURE OF SUSTAINABLE CONSTRUCTION

• Recycled steel, reclaimed wood, crushed concrete, and recycled plastic
• Environmental Impact: Reduced demand for virgin resources, decreases in energy
consumption and carbon footprint.
• Performance may be lower for some materials.
• Sustainability Rating: High
BEST PRACTICES IN MATERIAL SELECTION
• Use Life Cycle Assessments (LCA) to evaluate material impact.
• Prioritize materials with lower embodied energy.
• Choose locally sourced, recycled, or certified sustainable materials.

FINAL THOUGHTS ON SUSTAINABILITY IN CONSTRUCTION

• Materials selection plays a crucial role in minimizing environmental impact.
• Innovation and recycling will help reduce the carbon footprint of construction projects.

MATERIALS SELECTION CRITERIA & CONSIDERATIONS

WHY MATERIAL SELECTION MATTERS:

• Careful material selection is essential for achieving functional, safe and sustainable
construction outcomes
• When selecting structural materials, several criteria and considerations come into play to
ensure the effectiveness, sustainability, and safety of the construction project.

Mechanical Properties
o Strength: The material must withstand loads without failing.
o Elasticity: Ability to return to its original shape after deformation.
o Durability: Resistance to wear, corrosion, and other environmental factors.

Cost
o Material Cost: Initial purchase price of the material.
o Lifecycle Cost: Consideration of maintenance, repair, and replacement costs over time.

Sustainability
o Environmental Impact: Assessing carbon footprint, energy use in production, and
recyclability.
o Sourcing: Preference for locally sourced materials to reduce transportation emissions.

Availability
o Local Availability: Ensuring materials can be readily obtained within the region to avoid
delays.
o Supply Chain Stability: Reliability of suppliers and potential for shortages.

Construction Methods
o Ease of Use: How easily the material can be handled, cute and assembled.
o Compatibility: How well the material works with other selected material and construction
techniques.

Building Codes and Standards

o Regulatory Compliance: Adherence to local and international building codes and standards
for safety and performance.
Aesthetic Considerations
o Visual Appeal: The material’s appearance and how it fits into the design aesthetic.
o Finishing Options: Availability of finishes that enhance aesthetics and durability.

Thermal and Acoustic Properties

o Insulation: Ability to provide thermal insulation and energy efficiency.
o Sound Insulation: Performance in reducing noise transmission.

Fire Resistance
o Safety: Materials should meet fire safety standards and possess adequate fire resistance.

Weight
o Structural Load: Th weight of the material affects the design and foundation requirements.
o Transportability: Lighter materials may reduce transportation costs and handling difficulties.

Adaptibility
o Versatility: Materials should be adaptable for various applications and future modifications.
o Ease of Repair: Consideration of how easily a material can be repaired or replaced.

Concrete: The Carbon-Intensive Choice

o The selection of structural materials requires a holistic approach, balancing performance, cost,
sustainability, and compliance with regulations.
o Thorough evaluation of these criteria will help ensure a successful and responsible
construction project