Main image from RIBA architecture.com
For any home improvement project, it’s always advisable to draw up a written contract with your chosen builder. Even if you’re building a simple extension, you will be making a significant investment which should be protected.
The contracts don’t need to be complex. There are standard forms of contract that are specifically designed for individuals seeking to renovate and extend their homes which are short and simple to use.
A building contract can help control build quality, timings and cost. It is in all parties’ interest to agree a building contract.
When you agree to go with a builder, whether you have written it down or not, you have formed a contract.
A building contract gives you peace of mind. It allows you more control over the management of your project ensuring it is built in accordance with the plans and completed on time and on budget. While it won’t eliminate all risks, a contract will make the build process run more smoothly.
The main advantage of a building contract is, it creates clarity and sets out:
Be very wary. If a builder does not want to use a building contract it is a sign, they are unprofessional, or worse, acting in bad faith. A written contract will protect their interests as well as yours as it clarifies exactly what is to be done for the price. There is no reason not to use one.
Building work is expensive. Would you buy a car, or any other big ticket item, without having an agreement in place first? Building work should be no different.
In most cases, no. If you have appointed an architect, they will advise on the most appropriate form of contract and arrange everything on your behalf.
You should always use an industry standard form of building contract whenever possible, one that is published by the Royal Institute of British Architects (RIBA) or The Joint Contracts Tribunal (JCT) as they have been tested by the UK legal system.
Legal advice is only required if you are entering into a bespoke agreement. These are generally best avoided as they are not subjected to the same rigorous testing as a standard form of building contract.
This varies depending on the type of building contract; however, most make provision for the following:
For simple home improvement works the two most widely used building contracts are:
Both are short agreements written in plain English.
The JCT HO/O comes in two versions - with or without a consultant administering the contract.
There is only one version of the RIBA DBC and it can be administered by you or a consultant.
The JCT HO/O is only advisable for the simplest of projects. If you want to appoint specific companies to design and install certain parts of the build, such as a low energy heating system or specialist glazing, the RIBA DBC is preferable as it includes provisions to enable their input. There is no similar provision in the JCT HO/O.
Further, the JCT HO/O does not make provision for phased start and completion dates, a consideration if you are living on site during the work and want to occupy certain parts as they are completed. It also doesn’t cover liquidated damages - more on this below.
For larger, more complex home improvement works, you will need to consider a more comprehensive agreement, such as:
The JCT MW is suitable for works where the contract value reaches £500K. JCT IC is appropriate for projects upto £1m.
An architect will be able to advise which build contract is most applicable to your particular project.
If the contractor delays the completion date, liquidated damages enable you to claim costs for loss and expense. For example, if you are unable to move in on the agreed date and need to pay for temporary accommodation.
A liquidated damages clause avoids disagreements about compensation and allows parties to manage the risks in advance.
The RIBA DBC, JCT MW and IC all allow for liquidated damages, but it’s not included in the JCT HO/O.
The status of subcontractors, separate companies directly appointed by you or the builder, can have a big impact on the programme and costs.
When you appoint a builder to renovate your home they act as the main contractor and are responsible for delivering the project on site. They may choose separate companies or individuals to carry out certain aspects of the build on their behalf, say the plumbing or electrical works. These are known as domestic subcontractors and are the responsibility of the main contractor.
If you want a specific company to carry out certain parts of the build, say a specialist heating system, and you impose them upon the main contractor, they are known as a nominated subcontractor and are your responsibility.
A middle way is to appoint a named subcontractor whereby you present a list of companies for the main contractor to choose from. As the main contractor has some control over the selection, they become their responsibility and are similar to a domestic subcontractor.
From a contractual point of view, it’s best to avoid nominated subcontractors to minimise your risk of causing potential delays, disputes and cost increases.
A digital copy of the RIBA Domestic Building Contract costs £40 plus VAT. A hard copy is £30 plus VAT.
The JCT Building Contract for aHome Owner/ Occupier who has not appointed a consultant to oversee the work costs £30 plus VAT for a digital or hard copy. The version where a consultant oversees the work costs £34 plus VAT.
The JCT Minor Works BuildingContract costs £37 plus VAT and £74 plus VAT for a digital and hard copy, respectively.
The JCT Intermediate BuildingContract costs £134 plus VAT and £67 plus VAT for a digital and hard copy, respectively.
Aside from drawing up the contract, an architect will prepare technical plans and specifications which detail exactly how the project is to be constructed. These form the contract documents and play a crucial role in controlling build quality and costs. Essentially, the more detail you include in the contract documents the better.A lack of detail often results in the builder either guessing what you want or building what they want, thereby increasing the risk of quality issues and cost increases.
Further, having a detailed set of contract documents reduces the risk of dispute with your builder. If the work is clearly set out in the beginning, there is little room for argument.
Hiring an architect as your contract administrator will ensure the site phase runs as smoothly as possible.
In the first instance they will advise on the most appropriate building contract for your project and prepare drawings and specifications which set out the scope of the agreement.
Once the building work is underway, they will make regular site inspections to check the work is in accordance with the plans, arrange for any defective work to be rectified, answer site queries, track of costs and certify payments to builders. As they have been directly involved in the design process, they are best placed to liaise with the builder on contract documents and ensure site quality.
When the building is practically complete, they will arrange final certification and payments and manage the defects period as agreed in the contract.
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How much do architects’ cost?
Architects have extensive experience of project administration and will manage the building process so everything goes as smoothly as possible. However, if you decide to appoint your builder without the help of an architect, use a building contract where you can act as contract administrator. For example, the RIBA Domestic Building Contract.
For larger, more complex home improvement projects it is advisable to appoint a construction professional, such as an architect, to administer the building contract and oversee the works. Investing in professional services pays dividends in the long run.
About the author: Aron Coates is an architect with over two decades of experience, encompassing projects ranging from the restoration of historic buildings to the design of contemporary homes.
The information provided in this article is intended for general guidance and educational purposes only. At Designs in Detail, we advise you appoint a skilled residential architect to provide specific expert advice for your project.
