Assignment 1

 Task 1 - Identify the necessary contract documents for

procuring a building using the NEC4 Engineering and
Construction Contract (Option B), and explain the purpose of
each document. (Word limit: 1000)

 Task 2 - Under the Hong Kong Standard Form of Building

Contract 2005 edition or the JCT Standard Form of Building
CONTRACT ADMINISTRATION Contract 2016, the parties have to complete and sign the
& DISPUTE RESOLUTION Agreement to create a contractual relationship. What is the
equivalent document applicable to the NEC 4 ECC? Comment
on the data/information that must be incorporated in the
project for the contract to be formed appropriately. (Word
6CN011HK Tutorial 3 limit: 1000).

Elements to contribute a contract

In order to have a legally binding / a valid contract, certain
HOW TO FORM A CONTRACT requirements must be satisfied, those elements are:

FORM OF TENDER 1. Parties must have Intention to create a legal relationship

2. There must be an Agreement, consist of:

LETTER OF AWARD/ACCEPTANCE  Offer (by one party must be clearly made)
 Acceptance (that offer must be unconditionally accepted by the other
party.
ARTICLE OF AGREEMENT  Upon acceptance, the contract comes into effect

3. Agreement must be supported by Consideration (代價)

for simple contract or made under seal
For Reference Only

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Offer and Acceptance Formalization of contract HK Practice

 In practice , a Form of Tender submitted by a contractor constitutes an  Tender (a Form of Tender) submitted by a contractor
offer  the Employer will issue tender queries post-tender addendum to constitutes an offer 
tenderers, if any (contract correspondence)  Finally, the Employer will
issue Letter of Award/ Letter of Acceptance to contractor which form a  The creation of a contract can be by means of
legally binding contract
acceptance of a tender or a revised tender
 A binding contract is thus created, although some Employers may require
such acceptance being subject to a formal agreement to record the core  In practice, the Employer/consultant will issue tender
obligations of the parties involved.
queries/ tender clarification / post-tender addendum to
tenderers (contract correspondence)
 A suitable form of agreement can be included in tender document, but
Employers often have their own standard forms
 Employer will issue Letter of Award/ Letter of
Acceptance to contractor which form a legally binding
contract

Formalization of contract HK Practice

Standard Form of Contract HK Practice

 A binding contract is thus created, although some  Standard form of contract consist of :
Employers may require such acceptance
Articles of Agreement
being subject to a formal agreement to record the
Terms of contract (Clauses)
core obligations of the parties involved.
Appendix

 Special Conditions of Contract

 A suitable form of agreement can be included in (Amendment to standard form of contract)
tender document, but Employers
often have their own standard forms

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 HK Standard Form 1. Enter “the contract date”

Formalization of contract HK Practice Articles of Agreement

Hong Kong Standard Form of Contract
 When using Standard Form of Contract, the signatures, 2. Enter Employer Name and Contractor Name
1) “This Agreement is made on
together with name and address, of both parties to the the _____ day of _____ 2025 ”
contract, the Employer and the Main Contractor, are
recorded in the Article of Agreement 2) “between the Employer
_____________ and the 3. Describe the works
Contractor __________”
 The names of both the Architect and the Quantity 4. site address
3) Whereas the Employer wishes
Surveyor appointed by the employer should also be to have work carried out
recorded comprising
____________________
(“the Works) ”
 Contract Sum that the Employer has agreed to pay the 4) at ____________(site address)
main contractor

HK Standard Form HK Standard Form

Articles of Agreement Articles of Agreement
Tender Documents comprising:
 “the Contractor has given priced
 A Form of Tender copy of the bills of quantities
 Drawings (“the Contract Bills”) to both the
Employer and the Architect”
 A specification
 Bills of quantities  “the Architect has given each
party one copy of the Articles of
Agreement, the Appendix, the
 “whereas the Contractor has,
Conditions, the Contract
based on the Tender Drawings, the Specification and
Documents, made in the Form Also refer to tender documents
the Contract Bills each signed by
of Tender has calculation of or on behalf of the parties”
the sum that he will require
for carrying out the Works by
pricing the bills of quantities”

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HK Standard Form HK Standard Form
Articles of Agreement Articles of Agreement
Hong Kong Standard Form of
 Article 1 – The Contractor will Contract
carry out and complete the
Works in accordance with and
subject to the Contract for the  Article 6 - If a dispute arises
consideration stated in Article 2 under or in connection with the
Contract, the parties agree to
 Article 2 – The Employer will pay resolve the dispute in accordance
the Contractor the sum of with the dispute settlement
HK$ ____________________ procedures in clause 41
[Awarded Contract Sum]

 Article 3 – The Architect

 Article 4 – The Quantity Surveyor

HK Standard Form – HK Standard Form –

Appendix Appendix
 Time for submission of master  Liquidated and ascertained damage
programme
HK$ per day
 Period of Interim Certificates
 Defects Liability Period

If not stated, 1 calendar month

If not stated, 12 months from substantial
completion of works
 Period for payment of certificates

NEC 4 : stated Defects Correction Period

If not stated, within 14 days from the date
of the certificate
 Limit of indemnity to 3rd party
liability insurance against injury or
 Retention Percentage
death to any person [HK$]

If not stated, 10%

 Date for Possession of the Site [NEC4:

stated Access Date]  Limit of Retention

 Commencement Date  Period for completion of the final

[NEC4: stated Starting Date] account (if not stated, within 12 months
from Substantial Completion of the whole of
 Completion Date the works)

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JCT –Articles of Agreement 1. Enter “the contract date” JCT – Articles of Agreement
3. Describe the works
1) “This Agreement is made the 2. Enter Employer Name and Contractor Name 3&4) Whereas the Employer wishes 4. site address
_____ day of _____ 20___ ” to have the following work carried
out ___________________ at
___________”
2) “between the Employer
_____________ and the
Contractor __________” 5) The Contractor has supplied the
Employer with a fully priced copy of
bills of quantities, which for
identification has been signed or
initialed by or on behalf of each
Party (“the Contract Bills”)

 The drawing are numbered /

listed in …..

JCT - Articles of Agreement JCT – Articles of Agreement

 If there is contractor’s designed Article 1 : Contractor’s obligations
portion
The Contractor shall carry out and
complete the Works in accordance
 The Employer has supplied to the with the Contract Documents
Contractor documents showing
and describing or otherwise
Article 2 : Contract Sum
stating his requirements for the
“The Employer shall pay the
design and construction of the
Contractor at the times and in the
contractor’s designed portion
manner specified in the Conditions …
the sum of ….. Or such other sum as
 The Employer has examined the becomes payable under this
Contractor’s proposals and Contract”
subject to the Conditions, is
satisfied that they appear to
meet the Employer’s
Requirements

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JCT – Articles of Agreement JCT – Articles of Agreement
Article 3 : Architect/Contract Purpose of Articles of Agreement
Administrator  Describes the work required by the employer, identifies the site, confirms the
preparation of the design and bill of quantities
Article 4 : Quantity Surveyor
 Confirms that a priced copy of the bill of quantities has been supplied by
“or, if he ceases to be the
the contractor to the employer, with a priced activity schedule where
Architect/Contract Administrator, required
such other person as the Employer
nominates in accordance with  Identifies the contract drawings
Clause 3.5 of the Conditions”
 Identifies whether the employer is to be considered a contractor
for tax deduction purposes under the Construction Industry Scheme
Remark:
So, it is similar to HK standard form
of contract, the names of both the  Clarifies whether the works are to be carried out in sections
Architect and the Quantity Surveyor
appointed by the employer will be  Where the contractor is obliged to complete design works under the
recorded provisions for a contractor’s designed portion

1. Enter “the contract date”

JCT – Articles of Agreement NEC 4 2. Enter Employer Name and Contractor Name

Purpose of Articles of Agreement NEC 4 provides an example of a

model Form of Agreement
 The obligation of the contractor, i.e. undertaking and completing the works
3. Describe the works
subject to the contract documents
1) “This Agreement is made the
 The obligation of the employer, i.e. to pay the contract sum or such other _____ day of _____ 20____ ”
sum as becomes payable under the contract (through variations and/or
2) “between the Employer
correction of errors)
_____________ and the
 Identifies the architect (or contract administrator) under the contract Contractor __________”
 Identifies the quantity surveyor
 Identifies the principle designer 3) The Employer wishes to have the
 Identifies the principle contractor following works provided
 Make reference to the right to adjudication in the event of any dispute
 Make reference to the right to arbitration in event of any dispute

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NEC 4 NEC 4

Sample form of agreement Sample form of agreement

 The Contractor will Provide the  The document forming part of this
agreement are :
Works in accordance with the
conditions of contract identified in
Contractor’s submitted tender
the Contract Data
Employer’s letter of acceptance

Contract Data part one
 The Employer will pay the
Contract Data part two
Contractor the amount due and (Data about the project that must be
carry out his duties in accordance incorporated)
with the conditions of contract

Other specified document
identified in the Contract Data
Remark:
 Remark: Clause 11.2(15) – To Provide the Works
means to do the work necessary to complete the
Not mention Form of Tender?
works in accordance with the contract and all
incidental work, services and actions which the

Not mention Included Bills of
contract requires Quantities?

NEC 4 – Option B “Bills of Quantities” NEC 4

Clause 56.1 – “Information in the Bills of Quantities is not Scope or  Essentially they record the agreement between the two
Site Information” Parties and identify the documents which make up
 This clause emphasizes that the Bill of Quantities is only a payment the contract
document. It cannot be used to determine what the Contractor is to
design or build; but only to determine payment to the Contractor for what
he designs or builds  The Contract Data define the details of the agreement which
is the Contract
Clause 11.2(16) - “Scope is information which specifies and describes
the works or state any constraints on how the Contractor Provides the
 In ECC, the term Contract Data refers to the data which exist
Works and is either in the documents which the Contract Data states it
at the Contract Date (the date on which the contract came
is in or in an instruction given in accordance with the Contract”
into)

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Form of Tender NEC 4
 [Clause 12.3] serves as a precaution against accidental or unintentional
Project title creation of change in the terms of the contract :
Employer’s name
We offer to Provide the Works in accordance
“No change to the contract, unless provided for by these conditions of
with the Contract Data part one and the
attached Contract Data part two for a sum to contract, has effect unless it has been agreed, confirmed in writing and
be determined in accordance with the signed by the Parties”
conditions of contract.
You may accept this offer on or before [date
of last day for acceptance]  [Clause 12.4] The Contract is the entire agreement between the Parties

Contractor’s info

NEC 4 NEC 4 – Contract Data

 The “entire agreement” clause, may be intended to reinforce a theme
which runs through NEC 4 that the Parties should treat the contract as
combining good project management procedures with complete sets of
obligations, liabilities and remedies

 The “entire agreement” clause also known as whole agreement clause. A

contractual provision which aims to prevent the party relying on it from
being liable for any statements or representations except as expressly set
out in the agreement

 “Completion of the data in full, according to the Options

chosen, is essential to create a complete contract”

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 NEC 4 – Contract Data Part One

e.g. W1

e.g. X3, X4, X7, X13, X16 ….

e.g. the construction of the residential building at

CONTRACT DATA - ABC Road, Hong Kong

PART ONE  Choose one dispute resolution option (W1 or W2)

 Choose any of the secondary options appropriate to the chosen contract
strategy (X1, X2….etc.)
 Describe the works clearly and briefly, the description should enable the
works to be identified and details can be included in the Works Information
and location of the works

NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

e.g Greenfield Holding Limited e.g Greenfield Holding Limited

e.g. 30/F, Great Building …. e.g. 30/F, Great Building ….

 Project Manager – He must have sufficient authority to

The Employer’s legal name and usual address are given here exercise the authority given to him under the contract
Same applied to :
 the Project Manager’s name and address  Supervisor – It is essentially to check that the works are
 the Supervisor’s name and address constructed in accordance with the drawings and
specification

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NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One
e.g Section 4 of the tender document

e.g. 2 weeks

e.g. As shown on drawing no.

ABC328(A1)-KP-01

e.g. English

 It is generally easier to show the boundary of the site on a  The period for reply must be sufficient for the parties to
drawing plan respond

NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

e.g. 3 January 2025

e.g. 52 weeks
e.g. Portion A as shown on drawing X e.g. 3 January 2025
e.g. Remainder of the Site e.g. 31 August 2025

e.g. 3 months

e.g. 1 October 2026

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NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

e.g. HK Observatory
e.g. pound sterling
e.g. 4 weeks

09:00
e.g. The X Office….
 To ensure a reasonable cash flow for the Contractor, the
assessment interval should not be too long e.g. Kowloon Kong
e.g. HK Observatory

 In practice most payment procedures will be based on  For consistency, it is generally an advantage to have the weather data and
weather measurement recorded at the same place
calendar months

NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

e.g. arbitration

e.g. the latest version of the ICE

Arbitration Procedure
e.g. London

e.g. 2 million pounds

e.g. 10 million pounds

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NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

0.25 Labour & supervision

0.30 Plant & road vehicles e.g. Portion A e.g. 30 Sept 2025
0.10 Ready mixed concrete e.g. Portion B

e.g. 1 August 2019

e.g. Census and Statistics
Department

NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

e.g. Portion A
e.g. $400 pounds
e.g. Portion A e.g. $250 pounds e.g.Western Roundabout

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 NEC 4 – Contract Data Part One NEC 4 – Contract Data Part One

Performance bond [Clause X13.1] Advanced payment bond [Clause X14.2]

e.g. $75,000
e.g. one million pound e.g. $20 weeks after
the Contract Date

EW1

NEC 4 – Contract Data Part One

Any amendments or additional conditions specific to the project

CONTRACT DATA -
PART TWO

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投影片 51

EW1 Eunice Wong, 2025/3/14

Returned Tender Document Returned Tender Document
Contract Data Part Two (pro-forma for completion by tenderers) Contract Data Part Two (pro-forma for completion by tenderers)

e.g. XYZ Construction and Engineering Ltd.

The statements to be given by the tenderer in part 2 of the Contract :

The statements to be given by the tenderer in part 2 of the Contract :  Working areas

The tenderer is invited to specify areas other than the Site that he wishes to be
 Name and address of the Contractor included as working areas
 Fee percentage (Clause 11.2(8))
These working areas should comply with the definition in Clause 11.2(17):
“The Site is the area within the boundaries of the site and the volumes above and below it which are

“The Fee is the amount calculated by applying the fee percentage to the amount of
affected by work included in the contract.
Defined Cost”

Returned Tender Document Returned Tender Document

Contract Data Part Two (pro-forma for completion by tenderers) Contract Data Part Two (pro-forma for completion by tenderers)

e.g. Section 8 of tender submission document

The statements to be given by the tenderer in part 2 of the Contract :

 If the Contractor is not required to carry out any design or if the Employer
The statements to be given by the tenderer in part 2 of the Contract :
does not wish the Contractor to submit any pre-tender design, there will be
 Key people no entry under this heading

A list of name, job descriptions, responsibilities, qualifications and experience of key
people is required
 If the Contractor is required to submit a large part of the design, the entry
will comprise a list of drawings and specifications accompanying the tender

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Returned Tender Document Returned Tender Document
Contract Data Part Two (pro-forma for completion by tenderers) Contract Data Part Two (pro-forma for completion by tenderers)

e.g. Section 9 of tender submission document

e.g. $30,000,000

The statements to be given by the tenderer in part 2 of the Contract :

The statements to be given by the tenderer in part 2 of the Contract :  The Contractor enters a reference to the priced bill of quantities which is being
 The programme reference no. or title should be given and the programme submitted as a included in his tender
separate document
 The tendered total should be entered, this will comprise the total of the bill of
 The main purpose of requiring submission of a programme with each tender is to inform the quantities
Employer of how the tenderer proposes to carry out the work and how it affect the Employer’s
other contracts and activities  The instructions to tenderers should include details of how the Employer will deal
with the discrepancy between the total of the BQ and the total entered in the
 If a completion date is to be proposed by the tenderer this should be stated in the Contract Contract Data, and how any arithmetical errors in tenders will be corrected
Data Part 2, having been calculated from the starting date and taking account of the access
dates stated by the Employer in the Contract Data Part 1

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