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Status Note amended March 2013

CONCODE

Guide to the GC/Works/1 (edition 3) General conditions of contract for building and civil

engineering

1997

STATUS IN WALES

ARCHIVED

Guideto the

GC/Works/1 (Edition 3)General Conditions of Contract

for Building and Civil Engineering

London: The Stationery Office

© Crown copyright 1997. Published for NHS Estates, an Executive Agency of the Department of Health, under licence from the Controller of Her Majesty’s Stationery Office.

Applications for reproduction should be made in writing to The Copyright Unit, Her Majesty’s Stationery Office, St Clements House, 2–16 Colegate, Norwich NR3 1BQ.

ISBN 0-11-322066-9

First published 1997

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This publication provides guidance on

GC/Works/1 (Edition 3) General

Conditions of Contract for Building and

Civil Engineering. It provides advice on

the amendments necessary to the

contract to comply with Departmental

policy, as well as good professional

practice in respect of use by NHS bodies

(NHS trusts and authorities, HAs and

any other centrally-funded bodies).

Scotland

The principles and guidance in this

publication are relevant to Scotland;

however, some of the detailed

references to statutes and other matters

are not applicable. Where the document

refers to either the Department of

Health or NHS Estates, this is to be

taken as referring to the Management

Executive of the NHS in Scotland.

References to the Capital Investment

Manual and Concode should be taken

as the Scottish Capital Investment

Manual and ScotConcode respectively.

Essential Scottish amendments are

provided in the Management Executive

Letter (MEL) which accompanies the

distribution of this document in

Scotland; copies are available from the

Management Executive, NHS in

Scotland, St Andrew’s House, Edinburgh

EH1 3DE.

About this publication

1

About this publication

1. GC/Works/1 (Edition 3) General Conditions of Contract for Building and Civil Engineeringpage 3

1.1 The contract

2. Government and Department of Health policy requirements page 4

2.1 Introduction2.4 Project director2.5 Project manager2.6 Co-ordinated Project Information (CPI)2.7 Use of GC/Works/1 (Edition 3) in the NHS2.14 Liquidated and ascertained damages2.25 Sub-contracting2.31 Suppliers2.33 Component Data Base (CDB) building components2.36 Insurances

3. GC/Works/1 (Edition 3): General Conditions of Contract for Building and Civil Engineering Standard Form of Contract – Lump sum with Quantities page 8

3.1 Introduction3.13 The Conditions

4. GC/Works/1 (Edition 3): General Conditions ofContract for Building and Civil EngineeringStandard Form of Contract – Lump sumwithout Quantities page 21

Appendix 1 – GC/Works/1 (Edition 3) SupplementaryConditions page 22

Appendix 2 – Bibliography page 23

Appendix 3 – Prompt payment page 24

Appendix 4 – Adjudication page 25

Appendix 5 – Project Manager (Architect/ContractAdministrator) page 26

Appendix 6 – The use of bonds and guarantees inNHS contracts page 31

References page 37

Other publications in this series page 39

About NHS Estates page 40

Contents

The contract

1.1 The GC/Works/1 (Edition 3) form of contract ispublished under the Property Holdings/DOE heading by:

The Stationery Office Publications CentrePO Box 276London, SW8 5DT.

1.2 Extracts from the document have been reproducedwith the permission of the copyright holders; TheStationery Office Ltd.

1.3 The contract is published in three different versions:

a. standard form of contract – Lump sum withquantities;

b. standard form of contract – Lump sum withoutquantities;

c. standard form of contract – Single stage design andbuild.

1.4 The contract can be adapted by the incorporation ofseparately published supplements for fluctuations.

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1.0 GC/Works/1 (Edition 3) General Conditions ofContract for Building and Civil Engineering

Introduction

2.1 Government and Departmental policy on matterssuch as:

• contract strategy;

• selection of contractors and consultants;

• contract conditions;

• EC Works Directives etc

are dealt with in ‘Guide to contract procedures’ which iscomplementary to the ‘Capital Investment Manual’.

2.2 NHS bodies are reminded that they must complywith the policies laid down in ‘Contracts and commissionsfor the NHS estate – Policy’. This policy document wasproduced to assist NHS bodies in the implementation ofGovernment and Departmental policies.

2.3 NHS bodies are referred particularly to the followingsections of ‘Contracts and commissions for the NHS estate– Policy’ when using GC/Works/1 (Edition 3):

a. Attestation;

b. Value Added Tax;

c. Fluctuations;

d. Loss/expense claims and settlements;

e. Liquidated and ascertained damages*;

f. Requirements of European Community Directives;

g. Works insurance*;

h. Construction industry tax deduction scheme;

j. NHS trusts – insurances*.

Project director

2.4 NHS bodies should appoint a project director for allprojects on which GC/Works/1 (Edition 3) is used. Thismay be a senior member of management withresponsibility for a specific major contract. The projectdirector will be an officer of the NHS body who shouldobtain appropriate professional support where he/she isnot technically qualified or experienced. When referring toguidance produced by the Central Unit on Purchasing,

* Further guidance on these subjects is given later in thissection.

HM Treasury, NHS bodies should substitute the term“project sponsor” for project director. NHS bodies shouldrefer to section 2 of the ‘Project Organisation’ andsections 1, 3 and appendices 5 and 6 of the ‘Managementof Construction Projects’ parts of the ‘Capital InvestmentManual’ for more details on the roles and duties of theproject director/sponsor.

Project manager

2.5 NHS bodies must appoint project managers for allmajor capital schemes of £1 million gross value or over.NHS bodies should note that the “project manager”under GC/Works/1 (Edition 3) performs a similar role tothe “architect/contract administrator” under JCTcontracts. To avoid confusion over the term “projectmanager”, the Department recommends for the sake ofclarity that the term “architect/contract administrator” issubstituted throughout GC/Works/1 (Edition 3). Thefollowing guidance is based on that amendment.

Co-ordinated Project Information (CPI)

2.6 The Department recommends the use of CPI, whichaims to improve the technical content of documents andalso the effectiveness of the co-ordination between them.CPI emphasises the relationship between quality andtimeliness of project information and the quality, speedand cost of construction on site. The conventions of CPIaim to promote co-ordination via recommendationsconcerning:

a. procedures for the production of documents;

b. the technical content of documents; and

c. the arrangement of documents.

Further information is contained in ‘Co-Ordinated ProjectInformation for building works, a guide with examples’,obtainable from RIBA Publications Ltd.

Use of GC/Works/1 (Edition 3) in the

NHS

2.7 GC/Works/1 (Edition 3) is suitable for use on majorworks of either a building or civil engineering nature. Ithas been drafted in plain English on behalf of theDepartment of the Environment. Unlike JCT contracts,GC/Works/1 (Edition 3) is not produced by severalinterested parties.

4

2.0 Government and Department of Health policy requirements

2.8 The Contractor is responsible for carrying out thework and design is substantially in the hands of theprofessional consultants engaged by the Authority (theNHS body). When the limited fluctuations basis is used,the project must be thoroughly pre-planned.

2.9 When using the traditional method of procurement,the Department recommends that bills of firm quantitiesshould be prepared for building and engineering worksand civil engineering works (including sub–contract works)if the project exceeds a reasonable limit of size and/orcomplexity and £350,000 or more at 1995 prices. Tendersare based on bills of quantities and drawings.

2.10 The Without Quantities version may be used onmajor projects where bills of quantities are not consideredsuitable. This may be due to the nature of the proposedworks. Tenders are based on a specification or schedulesof work and drawings.

2.11 Although the Department recommends the use ofbills of quantities for engineering work for major schemes,NHS bodies have discretion as to the extent to whichthese are adopted, whether as part of a combinedbuilding and engineering contract or the subject of awholly engineering contract. NHS bodies should ensurethat detailed quantified schedules of rates are provided bythe Contractor and Sub-Contractor for engineeringservices in cases where engineering bills of quantities arenot used.

2.13 In respect of any building and engineering works tobe carried out, the scope and extent of the Works mustbe fully detailed and described in the tender documents.The documents that comprise the tender are:

a. General Conditions of Contract GC/Works/1 (Edition 3);

b. Abstract of particulars and Addendum;

c. the numbers of the Supplementary Condition(s);

d. specification documents;

e. bills of quantities;

f. the drawing numbers; and

g. other documents, for example Standard FirePrecautions P5 (1980 Edition – revised 1987).

Liquidated and ascertained damages

2.14 GC/Works/1 (Edition 3) contains a provision toenable the Authority to recover liquidated and ascertaineddamages in the event that the Contractor does notcomplete the Works by the relevant date for completion,or by a new date for completion fixed under the contractconditions. The rate of liquidated damages must be agenuine pre-estimate of the damage likely to be sustained

by the Authority. The rate must be carefully assessed bythe NHS body for each project in the light of its particularcircumstances, and it is likely that it will include some orall of the following:

• additional costs arising from extra time spent byadministrative, professional, supervisory and otherstaff (including the NHS body’s own officers) in themanagement of the contract;

• direct losses and expenses arising from the necessityto rent or use alternative accommodation while anew building is not available;

• loss of revenue;

• loss of amenities for providing healthcare (that is,since health building schemes mostly provideadditional facilities, there is a loss of expectedamenities when the scheme is not completed ontime).

2.15 Additional staff costs and direct losses and expensescan be easily estimated, but loss of amenities cannotnormally be assessed by any generally acceptablecalculation other than expressing the loss as beingequivalent to a return, by way of interest, on theanticipated Contract Sum.

2.16 There are two alternative methods of estimating thedamages, the choice between them being dependent onthe particular project:

a. where loss of amenities is not a significant featureof the project, damages may be assessed byestimating additional costs and direct losses andexpenses;

b. where loss of amenities is significant (which itfrequently will be for NHS projects), a rate ofinterest of 15% per annum of the anticipatedContract Sum (pre-tender estimate) should beadopted instead. This rate (which includes 2½% foradditional staff costs) has been adopted by otherGovernment departments and is independent ofshort-term changes in general interest rates.

2.17 It is emphasised that the loss of amenities method isan alternative to estimating direct costs, losses andexpenses, but nevertheless, the Department would notexpect to see a rate which represented much less than15% per annum on a contract without special features.

2.18 When calculating the rate of liquidated damages,the NHS body’s Director of Finance should be askedwhether there are any special revenue features of theproject which would warrant a sum different from thatbased upon the loss of amenities method.

2.19 Condition 55 of GC/Works/1 (Edition 3) requires therate of liquidated damages to be stated in the Abstract of

5



Particulars to the contract as a specific sum of money perperiod of delay. Where the damages have been assessedby taking a percentage of the anticipated Contract Sum,the amount obtained should be divided by 365,“rounded” appropriately and stated as £ per day.

2.20 NHS bodies should note that the Courts have heldthat an arbitrarily fixed “penalty” is not acceptable. It istherefore not possible to incorporate “penalty” clausesinto a contract that attempt to force a Contractor toperform to time.

2.21 Condition 36 sets out the detailed procedures forclaiming, granting and reviewing an extension of time andfixing a new completion date so that the contract doesnot become “at large”.

2.22 If the Contractor fails to complete the Works by thedate for completion, unlike JCT contracts there is norequirement for the Architect/Contract Administrator toissue a certificate to that effect.

2.23 Under condition 55(2) the contractor immediatelybecomes liable to pay liquidated damages at the ratestated in the Abstract of Particulars to the Authority.

2.24 It is Government policy that the deduction ofliquidated damages, by the Authority, followingunjustified delay in the completion of a project by theContractor should be pursued vigorously.

Sub–contracting

2.25 GC/Works/1 (Edition 3) includes provisions for

a. domestic sub-contractors to be selected by theContractor and the Authority (condition 62);

b. nominated sub-contractors to be selected andnominated in such ways as may be directed by theAuthority or instructed by the Architect/ContractAdministrator (condition 63).

2.26 Sub-letting a portion of the Works by theContractor under condition 62(1) is at the discretion ofthe Contractor, provided he obtains prior consent fromthe Architect/Contract Administrator.

2.27 Where a project involves work which may require aspecialist sub-contractor with design expertise, the sub-contractor should be nominated.

2.28 It is important to appreciate that all types of sub-contractor are under the control of the Contractor. Allcommunications and instructions between theArchitect/Contract Administrator and selected sub-contractors must be made through the Contractor.

2.29 Where the NHS body intends to select domesticsub-contractors (condition 62(1) or nominate firms as sub-contractors or suppliers (condition 63), it must ensure thattheir technical competence and financial stability areassessed. In any preliminary discussions with sub-contractors or suppliers, care must be taken not to giveany commitment to select them before the appropriatestage of agreement has been reached.

2.30 The responsibility for the technical competence andfinancial stability of domestic sub-contractors selected bythe Contractor (condition 62(1)) rests with the Contractor.The NHS body’s rights under the contract that thespecified standard of materials, goods and workmanshipare met, are not affected by the fact that the work hasbeen sub-let. If the Contractor states the name of theproposed domestic sub-contractor, the Architect/ContractAdministrator is at liberty to take into account anyinformation or knowledge that they have about the firmwhen considering whether to give consent.

Suppliers

2.31 The difference between a sub-contractor and asupplier should be noted:

a. a sub-contractor supplies and fixes any materials orgoods or executes work;

b. a supplier only supplies materials or goods whichare to be fixed by the Contractor.

2.32 Suppliers may be:

a. selected by the Contractor (this does not require theapproval of the Architect/Contract Administrator);

b. nominated or appointed in such ways as may bedirected by the Authority or Instructed by theArchitect/Contract Administrator (condition 63(1)).

Component Data Base (CDB) building

components

2.33 The current CDB (published by HMSO in 1989) iscontained in a series of Health Technical Memoranda(HTMs 54–71). Although information and guidance oncomponent specification and design is provided in theHTMs, lists of suppliers are not. The Architect/ContractAdministrator should prepare his own lists of suitablesuppliers. Wherever possible, preference should be givento products and services from sources which have beenregistered either under BSI Quality Assurance Proceduresunder BS EN ISO 9000 (formerly BS 5750) or acceptableequivalent quality control procedures.

2.34 Information about project documentation andprocurement of components is included in the User

6

Manual (HTM 54.1) and in each HTM. Suppliers ofcomponents may be nominated using condition 63.

2.35 Where component suppliers offer a site fixingservice there is also the option of treating them as:

a. domestic sub-contractors under condition 62(1) (bythe Contractor);

b. nominated sub-contractors under condition 63 (seeparagraphs 2.25 to 2.34).

Insurances

2.36 General information on Government policy can befound in Chapter 6 of ‘Contracts and commissions for theNHS estate – Policy’.

2.37 NHS trusts have been provided with Departmentalapproval to make their own decisions on insurancematters. Trusts should therefore make a consideredjudgement whether:

a. they are prepared to carry the particular riskthemselves without taking out insurance;

b. they should take out insurance themselves; or

c. they require insurances to be taken out by theContractor at a cost to the NHS body.

7


December 1989 Revised 1990

Introduction

3.1 The contract “Standard Form of Contract – Lumpsum with Quantities” is examined and guidance is givenon its completion and amendment. The tender must:

a. state that the form of contract to be used will bethe GC/Works/1 (Edition 3) General Conditions ofContract – Lump sum with Quantities;

b. clearly set out all amendments that the NHS bodywill make to the printed form when preparing thedocument for execution by the NHS body and theContractor.

3.2 It should be noted that the “NHS body” is describedas “the Authority”.

3.3 To avoid confusion over the term “ProjectManager”, the Department recommends for the sake ofclarity that the term “Architect/Contract Administrator” issubstituted throughout GC/Works/1 (Edition 3). The term“Architect” applies where the person concerned isentitled to the use of the name “Architect” under and inaccordance with the Architects Registration Acts, 1931and 1938. In all other cases the term “ContractAdministrator” is applicable.

3.4 Amendments are occasionally made to theGC/Works/1 (Edition 3) form of contract and areincorporated into the text of the contract at the nextreprint. Amendments can be incorporated into thecontract by amending the printed wording of the contractin black ink before it is signed by the parties. Eachseparate amendment must be initialled by or on behalf ofeach of the parties.

3.5 This section is based on the reprint of the formdated 1990. Amendments should be incorporated asdescribed in paragraph 3.4.

3.6 All Authority amendments to the contract must bein accordance with those stated in the SupplementaryConditions. Amendments made by the Authority must beinitialled by or on behalf of each of the parties.

Insert the amendments contained in Appendix 5.

8

3.0 GC/Works/1 (Edition 3): General Conditions ofContract for Building and Civil Engineering StandardForm of Contract – Lump sum with Quantities

Commentary Notes/Amendments

3.7 Where the wording of a printed condition is varied,it is recommended that the printed condition is deletedentirely and a typed amendment slip is attached with therevised wording. Additional conditions should beincorporated in a similar way.

3.8 It is good practice for each amendment to beidentified for initialling by the parties.

3.9 The originals of the contract documents (seecondition 2: Contract Documents) must be retained by theAuthority in safe keeping and a certified true copy of theoriginals provided by the Authority to the Contractor, freeof charge.

3.10 Any parent company guarantee required relating tothe main contract should normally be executed as a deedbefore the main contract is executed. The original isretained by the Authority in safe keeping with theoriginals of the contract documents. Further guidance onparent company guarantees is contained in Appendix 6.Parent company guarantees may also be required relatingto Nominated Sub-Contracts.

3.11 When the printed form is to be modified by anamendment, the Department recommends that anadditional Supplementary Condition is incorporated.

3.12 To reflect a more fair and reasonable approach toGC/Works/1 (Edition 3), the concept of “final andconclusive” decisions by or on behalf of the Authorityshould be deleted. Amendments to conditions 6, 18, 24,26, 31, 39, 40, 44, 56, 60 and 63 should be made.

The amendments to be made to Conditions 6, 18, 24, 26,31, 39, 40, 44, 56, 60 and 63 are:

a. Condition 6(1):

delete last sentence;

b. Condition 18(3):

in line 3 delete “and those measurements shall forthe purpose of the Final Account be final andconclusive”;

c. Condition 24(3):

delete sub-condition and insert “(Number notused)”;

d. Condition 26(3):


e. Condition 31(6):


f. Condition 37(7):


9

3.0 GC/Works/1 (Edition 3): General Conditions of Contract – Lump sum with Quantities


The Conditions

Condition 2: Contract documents

3.13 This condition deals with the priority of the contractdocuments to be made available to the Contractor. Itshould be noted that in the event of any discrepancy theConditions will prevail over other documents.

3.14 If NHS bodies intend to amend the printedconditions this must be done by means of supplementaryconditions.

Condition 3: Bills of Quantities

3.15 It should be noted that the method of measurementused for the preparation of the Bills of Quantities must bestated in them.

Condition 4: Delegations and Representatives

3.16 Under Condition 4(1) the Architect/ContractAdministrator is deemed to act on behalf of the Authorityunless any exclusions are set out in the Abstract ofParticulars. If no exclusions are stated, the Architect/Contract Administrator can make any decision made bythe Authority. It is thought unlikely that NHS bodies willdelegate all their powers under the contract, and thatthey will reserve certain matters for themselves.

g. Condition 39(2):


h. Condition 40(3):

delete the 2nd sentence;

j. Condition 44(5):


k. Condition 56(9):


m. Condition 60(1):

in line 4 delete “other than a matter as to which adecision is expressed to be final andconclusive”;

n. Condition 63(3):

delete the last sentence.

NHS bodies must consider which matters they wish todelegate to the Architect/Contract Administrator. Amongthe matters which NHS bodies may wish not to delegateare:

• disputes about the giving of certificates (condition39(2));

• determination (condition 56(1));

• matters arising under the arbitration agreement(condition 60).

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3.17 Condition 4(2) enables both the Architect/ContractAdministrator and the Quantity Surveyor to delegate inwriting any of their powers and duties. NHS bodies mustdecide which powers and duties, if any, they will allow theArchitect/Contract Administrator and the quantity surveyorto delegate.

3.18 Any delegations under this condition, together withnames of the representatives, should be given to theContractor in writing.

Condition 7: Conditions affecting the Works

3.19 This condition places the risk that the site and alliedconditions may be more burdensome than expected onthe Contractor. Apart from unforeseeable groundconditions, the Contractor is not entitled to any additionalpayment on the grounds of any misunderstanding ormisinterpretation of the matters to which the conditionrefers. As a result of this, the Contractor is not releasedfrom any contractual risks or obligations imposed on orundertaken by him, or because he did not foresee anymatter affecting the works.

Condition 8: Insurance

3.20 This condition imposes an obligation on theContractor to maintain relevant insurance up to the endof the longest maintenance period. There are twoalternative insurance conditions available to NHS bodies.

3.21 Insurance under Alternative A covers the standardcontractor’s “all risks” insurance. Alternative B covers forjoint names insurance: that is, it includes the Contractorand the Authority. It is necessary to state in the Abstractof Particulars which alternative is to apply. The back of theconditions contains examples of model forms regardingcertificates of insurance for Alternatives A and B. NHSbodies should adapt these to suit their own specificrequirements.

3.22 The following insurance policies must be maintainedby the Contractor:

a. employers’ liability insurance covering persons in hisemployment;

b. insurance against loss or damage to the works andthings for which the Contractor is responsible forunder the contract; and

c. insurance against personal injury to any persons,and loss of or damage to property (that is, third-party liability) not already covered.

3.23 Condition 8(2) states that any insurance policy mustbe for the “full reinstatement value”. It is essential that

11



NHS bodies regularly review that the insured sum isadequate. Recognition should be taken of the cost of anyinstructions of the Architect/Contract Administrator andthe increased costs that will be incurred whenreinstatement takes place, including that resulting frominflation.

3.24 The term “full reinstatement value” is used in thecontract to emphasise that the sum insured must reflectthe actual cost of reinstatement at the time ofreinstatement, whenever that may be. The term isintended to cover:

a. the actual cost the contractor incurs in reinstatingthe works;

b. materials lost or damaged;

c. the cost of removing debris in order to prepare forreconstruction.

It also appears to cover consequential loss –for example,loss to the Authority due to delay in completing the worksor any cost of carrying out the work not done at the timethe damage happened.

3.25 NHS bodies should note that condition 8(2) doesnot cover any allowance for professional fees. NHS bodiesmust take into account the range of design consultantsand clerks of works (both NHS bodies’ own officers andprivate consultants) engaged on the contract. The cost oftheir services, together with allowances for expenses andVAT, should be expressed as a percentage applied to thepre-tender estimated cost of the works. To allow for therecovery of professional fees the notes/amendmentsopposite (together with an assessment of the percentageaddition) should be added to the end of condition 8(2).

Condition 10: Design

3.26 This condition requires the Contractor, either byhimself or by means of any servant, agent, sub-contractoror supplier, to carry out the design of any part of theWorks that is required under the contract. The appropriatedesign information must be submitted to the Architect/Contract Administrator for approval. The contractor mustalso receive the Architect/Contract Administrator’s priorwritten approval before making any alterations to theapproved design.

Contractor’s liability for design

3.27 Condition 10(2) places on the contractor a similarobligation with regard to design work carried out byhim/her under the contract as would be placed on anarchitect under a commission from a client. Under the

At the end of line 2 Condition 8(2) insert “plus ...% forprofessional fees”.

12



latter arrangement no limit is placed on the architect’sliability to the client and the Department sees no reasonwhy any limit should be set when a Contractor designsinstead of an architect.

3.28 It is, however, important to appreciate that theconditions do not include any requirement that theContractor’s liability (which could be substantial) becovered by insurance. The Department considers itimportant that NHS bodies should adopt a procedure toensure that suitable insurance cover is taken out by theContractor and maintained not only during the period ofthe contract, but also for a reasonable period of yearsthereafter. (Design defects may well not become apparentfor a considerable time after completion of the Works.)

3.29 The Department recommends that NHS bodiesshould adopt a procedure broadly similar to that used inregard to professional consultants’ insurance. At tenderstage, the NHS body should require submission of theContractor’s insurer’s certificate and make it a conditionof the contract that the Contractor take appropriate coverlasting six years from the date of completion of theWorks. The NHS body should make an annual check thatthe necessary cover is being maintained, by obtainingfurther certificates from the insurer.

3.30 The certificates, which should be given by theContractor’s insurer/insurance broker (not by theContractor him/herself), should be to the effect that thecontractor is currently insured for the period ending .........(date) for all claims arising as a direct result of anynegligent act, error or omission in the conduct andexecution of designs entrusted to him or entrusted by himto any other party. The limit of indemnity for each andevery claim and the amount of any excess (if any) carriedby the contractor on each and every claim should bestated.

3.31 Should it be found that the Contractor does notcarry insurance covering liability for design work, his/hersuitability for the award of the contract should beconsidered.

3.32 Passing responsibility for design for a portion of theworks from professional designers to contractors iscontrary to the Department’s view that NHS bodies shouldprepare as full design details as possible prior to invitingtenders if a traditional contract strategy is being used.However, there may be circumstances involving specialiseddesign where it is advisable to draw on the expertise ofmanufacturers. This can normally be achieved bynominating a sub-contractor or a supplier which will alsosecure warranties to the employer with regard to thedesign work.

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3.33 Should the Authority obtain any direct warrantyagreement with specialist sub-contractors and otherdesigners, this will not affect the Contractor’s liability inany way.

Condition 19: Loss or Damage

3.34 This condition relates to the Contractor’s liability forany loss or damage. It is not limited to loss, or to theContractor’s liability for any loss or damage. It includesloss of or damage to third-party property, personal injuryand loss of property. Any loss or damage arising underthis condition is dealt with under the provisions ofconditions 8: Insurance; 13: Protection of Works; 30:Vesting.

Condition 21: Defects in Maintenance Periods

3.35 The Abstract of Particulars and Addendum allowsfor different maintenance periods to be stated. It isimportant to note that under sub-condition 4 themaintenance period recommences after the defects havebeen remedied. Where the works include mechanical andelectrical types of engineering work, it may be considerednecessary to specify a period of 12 months in order togive test operation through one complete climatic year,but the period should never extend beyond 12 months.On no account should any attempt be made to specifydifferent periods for “building” and “engineering”. Theremust be only one period, and this will apply to the wholeof the Works. Longer-term protection against latentdefects is given under the law of contract or the law oftort. It is important to note that under sub-condition 4,the maintenance period recommences after the defectshave been remedied.

Condition 22: Government Premises

3.36 This condition is generally not applicable to NHSbodies and should be deleted.

Condition 23: Racial Discrimination

3.37 NHS bodies are subject to the legislation on racialdiscrimination (including the penalties for contravention).They are required to remind contractors of the need tocomply with the provisions of the Race Relations Act 1976or any statutory modification or re-enactment thereofrelating to discrimination in employment. The onus ofcomplying with the requirements of the legislation restswith the Contractor.

NHS bodies need to consider whether to take out anydirect warranty.

Delete condition 22 in its entirety.

14



Condition 26: Site Admittance

3.38 NHS bodies should remind contractors that theprovisions of sub-condition 26(1) will be applied by theArchitect/Contract Administrator in cases of breach ofhealth, safety and welfare requirements.

Condition 32: Excavations

3.39 Under sub-condition (1), all materials and objects ofany kind obtained from the excavations remain theproperty of the employer. Under sub-condition (2), theAuthority may allow any of the materials arising from theexcavations to be used ‘for any Things . . . which theContractor would otherwise have provided’. In thesecircumstances the quantity surveyor ascertains the amountof any savings and reduces the amount of the contractsum by this sum.

Condition 33: Programme

3.40 This condition requires the Contractor to produce aprogramme that shows the sequence of working, detailsof any temporary work, labour and plant proposed andalso events that, in the Contractor’s opinion, are critical tothe satisfactory completion of the works. The programmeshould also allow for reasonable periods of time for theprovision of information required from the Authority. Itshould be noted that the programme must show thewhole period of construction and is not to show a shorterconstruction period.

3.41 Sub-condition (2) allows for the programme to besubmitted either as part of the tender or within 21 daysafter acceptance of the tender. NHS bodies arerecommended not to ask for a programme to besubmitted with the tender.

3.42 Sub-condition (1) provides for period(s) of time tobe stated in the Abstract of Particulars in which theAuthority will notify the Contractor of the date ofpossession of the site or parts thereof. This period of timeshould run from the date of acceptance of theContractor’s tender. The date of possession shouldnormally not exceed 60 days (including the period ofnotification) from the date of acceptance of thecontractor’s tender. Additionally, the date for completionshould be given as a specific number of consecutivecalendar weeks after the date of possession. Specific datesfor possession and completion should not be given attender stage since they will need to be established withthe successful tenderer.

3.43 Tenderers, if they wish, should not be precludedfrom submitting an alternative tender for considerationbased on a different construction period to that stated inthe tender documents. However, a conforming tenderbased on the tender documents must also be received soas not to disqualify the tender as being qualified. Thesealternatives should be carefully evaluated beforeacceptance.

3.44 The period for the execution of the Works stated intender documents is normally assessed by the Architect/Contract Administrator in consultation with the designteam and the Authority.

3.45 The Works or any relevant section are to becompleted to the satisfaction of the Architect/ContractAdministrator by the date(s) for completion. TheArchitect/Contract Administrator must certify when theworks or any section thereof are completed to hissatisfaction (Condition 39: Certifying Work). A furthercertificate has to be issued at the end of the longestrelevant maintenance period.

Condition 35: Progress Meetings

3.46 This condition makes it a mandatory requirement to hold monthly progress meetings unless instructedotherwise. Five days before each progress meeting theContractor must submit to the Architect/ContractAdministrator a comprehensive written report. Withinseven days of each progress meeting, the Architect/Contract Administrator has to give a written statementcovering similar matters.

3.47 Subsequent to each progress meeting, theArchitect/Contract Administrator should review and,where necessary, amend the stage payment chart (seecondition 48(3)).

Condition 36: Extensions of Time

3.48 Condition 36 sets out the detailed procedure for theclaiming and granting of an extension of time forcompletion of the Works, and lists the grounds on whichan extension of time may be granted. It should be notedthat there is no entitlement to an extension of time due toweather conditions; these are entirely at the Contractor’srisk. The Authority should take into account any likelyeffects of weather when calculating the contract periodthat is stated in the tender documents.

3.49 Under Condition 36(1), the Architect/ContractAdministrator must consider the possibility of an extensionof time when he receives a notice requesting an extension

15


Commentary Commentary

of time and also where he considers that there has been,or is likely to be, a delay which will prevent completion ofthe Works or any relevant section by the relevant date ofcompletion.

3.50 Condition 36(1) states a maximum time limit (42days from the date any notice is received) for theArchitect/Contract Administrator to inform the Contractorof any decision regarding any extension of time. This timelimit and the other time limits contained in condition 36are mandatory and cannot be extended (see condition1(4)).

3.51 The Architect/Contract Administrator should takeinto account any authorised omissions which have theeffect of saving time. It should be noted that theContractor will not be entitled to an extension of timewhere the delay or likely delay is, or would be attributableto, the negligence, default, improper conduct or lack ofendeavour of the Contractor.

Condition 37: Early Possession

3.52 This condition provides a facility for the employer totake possession of a part of the works prior to completionof the works as a whole. It applies to a section of theworks or part of the works in respect of which the partiesagree, or the Architect/Contract Administrator has givenan instruction, that possession should be given before thecompletion of the works or relevant section.

3.53 The Architect/Contract Administrator should issue acertificate to the Contractor identifying the part or partsof the works taken in possession. From the date on whichthe Architect/Contract Administrator certifies satisfactionwith the completed part, it no longer forms part of theworks for the purposes of conditions 19 (Loss anddamage), 30 (Vesting), 8 (Insurance).

3.54 Condition 37(2) provides that the defects liabilityperiod for a part of the works taken over by the Authoritymust commence on the date of the Architect/ContractAdministrator’s certificate.

3.55 As soon as possible after the date of the Architect/Contract Administrator’s certificate the Architect/ContractAdministrator must certify the value of the completed partfor the purposes of liquidated damages and release of thereserve to the contractor. The rate of liquidated damagesmust be reduced by the same proportion as the value ofthe part taken over to the contract sum. The Authoritymust immediately pay to the Contractor the first half ofthe reserve.

Condition 39: Certifying Work

3.57 This condition imposes a duty on the Architect/Contract Administrator to certify the date when the worksor a section are completed to his satisfaction, and startsthe operation of condition 49 (Final account). It alsoallows any difference or dispute to be referred toarbitration.

Condition 41: Valuation of Instructions – Principles

3.58 It is important to note that this condition requiresthe cost (if any) of any disruption to or prolongation ofboth varied and unvaried work to be included in thevaluation of the instructions.

Condition 42: Valuation of Variation Instructions

3.59 This condition allows variation instructions to bevalued by either:

a. acceptance of a lump sum quotation; or

b. valuation by the quantity surveyor alongconventional lines.

It is important to note that this condition lays down atimetable for ascertaining the cost of variationinstructions. The time limits may be extended byagreement under condition 1(4).

3.60 Where variation instructions are valued byacceptance of a lump sum quotation, it is for theArchitect/Contract Administrator and not the QuantitySurveyor to decide whether to accept or reject theContractor’s quotation.

Condition 46: Prolongation and Disruption

3.61 The attention of NHS bodies is particularly drawn tothe very limited list of matters in Condition 46(1) whichmay give rise to a claim for prolongation and disruptionfrom a contractor. NHS bodies must manage contracts sothat, as far as possible, situations are avoided which maygive rise to claims for additional payments.

3.62 Claims and settlements are discussed in Chapter 4of ‘Contracts and commissions for the NHS Estate –Contract procedures’.

3.63 It should be noted that the cost of valuing thedisruptive effect of variations is not included under thiscondition. Expense incurred does not include for anyconsequential loss, and excludes interest or financecharges however incurred. This condition contains time

16



limits for the supply of full details to support any claims,and for the decision of the Quantity Surveyor. These timelimits maybe extended by agreement under Condition1(4).

Condition 47: Finance Charges

3.64 If money is withheld from the contractor in specifiedcircumstances which are due to the Authority or itsrepresentatives, an amount for finance charges is addedto the relevant payments. It is not necessary for thecontractor to claim these charges, as they must beautomatically added to the payments. The rate of financecharges is 1% over the rate charged during the relevantperiod by the Bank of England for lending money to theclearing banks.

Condition 48 : Advances on Account

3.65 Condition 48 needs to be read in conjunction withCondition 49: Final account and Condition 50: Certifyingpayments.

3.66 This condition contains the provisions regarding:

• monthly advances;

• reserve.

3.67 Payment under GC/Works/1 (Edition 3) is made byreference to a stage payment chart(s) which is normallyissued to the main contractor and any nominated sub-contractors with the tender documents. These charts areexclusive of any reserve (retention). An example of a stagepayment chart is included at the back of the conditions.This chart will need to be adapted to suit the individualrequirements of each scheme.

3.68 Assuming contractors achieve the necessary rate ofprogress, they know in advance how much they willreceive each month. These advances will need to beadjusted to take account of variations, prolongation anddisruption claims and finance charges. This chart is subjectto adjustment where the works are delayed or ahead ofprogramme, where the Architect/Contract Administratorhas recorded this in a statement after a progress meeting.

3.69 Where the value of a variation has been agreed, no“reserve” is held on the variation. This should provide anincentive for the contractor to agree the value ofvariations.

3.70 It should be noted that condition 48 does not coverfor payment of materials either on or off site. Reliancemust be placed by the Authority on Condition 30: Vesting

17



of what is on site, which does not cover all eventualities.There are no provisions regarding payment for materialsoff-site.

Condition 49: Final Account

3.71 This condition contains a strict timetable for thepreparation and agreement of the final account.

3.72 When the works are completed to the satisfactionof the Architect/Contract Administrator, the Authoritymust revise its assessment of the final sum and releasehalf of the reserve as soon as possible.

Period of final measurement and valuation.

3.73 Condition 49(2) requires the Quantity Surveyor toforward a draft of the final account to the Contractorwithin six months of completion. The Contractor then hasthree months in which to notify agreement ordisagreement with the draft final account. If theContractor disagrees, he must state the reasons why andhis own valuation. If the Contractor fails to respond ordisagrees without giving proper reasons, he is deemed tohave agreed the draft final account as the final account.

Condition 50: Certifying Payments

3.74 This condition states that the Architect/ContractAdministrator must certify the sums that the Contractor isentitled to. No mention is made of sums due tonominated sub-contractors or suppliers. It isrecommended that sums due to each nominated sub-contractor and supplier are shown separately.

Prompt payment to suppliers and subcontractors

3.75 In GC/Works 1/(Edition 3) there is no provision forany period within which the Authority must makepayment to the Contractor. To comply with Governmentpolicy, NHS bodies must amend new contracts, wherenecessary, for building and maintenance to encourageprompt payment.

3.76 NHS bodies must also incorporate amendments toencourage prompt payments to sub-contractors. Theserequire the main contractor to pay its sub-contractorwithin 30 days of receipt of a valid demand for paymentas defined for the contract.

Insert the following additional sentence at the end ofcondition 50(1):

“The Authority shall pay to the contractor each certifiedsum within 14 days of its certification.”

Insert the amendments contained in Appendix 3.

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Condition 52: Cost Savings

3.77 This condition provides contractors with theincentive to suggest possible savings:

a. in the cost of the works;

b. in the cost of maintenance; or

c. through an increase in the efficiency of thecompleted works.

Any proposals by the Contractor must be submitted to theArchitect/Contract Administrator in writing. The proposalsmust state that they are for consideration under thiscondition, and must include an estimate for considerationby the Authority. Savings made due to any acceptedproposals are shared equally.

3.78 Should the Authority accept any proposal, or agreewith the Contractor any amended proposal:

a. the date for completion and the programme shouldbe amended accordingly; and

b. the Architect/Contract Administrator should issueany agreed extension of time which is necessary.

Condition 55: Liquidated Damages

3.79 The abstract of particulars requires the rate at whichliquidated and ascertained damages will be deducted tobe specified when the contract is drawn up for execution,notice of which will have been given in the tenderdocuments.

3.80 The method of assessment of the rate for damagesis discussed in paragraphs 2.14 to 2.24.

Condition 59: Adjudication

3.81 Adjudication is a form of dispute resolution that isintended to prevent disagreements from lingering duringthe works. The time limits laid down by this condition aretight, and comply with the requirements of the HousingGrants, Construction and Regeneration Act 1996.

Condition 60: Arbitration

3.82 Attention is drawn to the guidance contained inChapter 4 of ‘Contracts and commissions for the NHSestate – Contract procedures’.

3.83 It should be noted that the time limits laid down bythis condition envisage that a maximum period of ninemonths should elapse before the arbitration is settled.

Delete existing Condition 59 and insert the amendmentscontained in Appendix 4.

19



Condition 62: Sub-letting

3.84 It should be noted that the Authority may accept asub-letting proposal at tender stage and that the contractmay specify or nominate the sub-letting of work.

Condition 63: Nomination

3.85 Nomination may be provided for in the contractdocumentation or named in any direction or instructiongiven under the contract. If the nomination is in thecontract documents, the Contractor has no right ofobjection. Once a sub-contractor has been nominated andaccepted by the Contractor, he is the main contractor’sresponsibility. There is no right to an extension of time ifthe nominated sub-contractor causes delay or fails.

Department’s recommendations on nomination of sub-contractors and suppliers.

3.86 Except for work or materials and goods of aspecialised nature or where a design input is requiredfrom a nominated sub-contractor or supplier, theDepartment recommends that nomination of sub-contractors and suppliers should be avoided whereverpossible.

Condition 65: Other Works

3.87 Condition 65 provides for work either not formingor forming part of the works to be executed by thecontractor, to be carried out by the Authority. Theexercise of this condition may give rise to a claim by thecontractor for an extension of time under condition 36and to a prolongation or disruption claim under Condition46.

20



Introduction

4.1 The “With Quantities” form and “WithoutQuantities” form are similar in many respects but thereare, nonetheless, some important changes which flowfrom the use of a specification or schedules or ratesinstead of bills of quantities. The principal differences arehighlighted in the following paragraphs.

4.2 The commentary and contract amendments set outin Chapter 3 regarding the “With Quantities” form applyequally to the “Without Quantities” version and should befollowed with only such changes as are clearly necessaryto preserve sense.

4.3 Care must be taken to select the appropriatefluctuation conditions for inclusion in the executedcontract.

Principal changes from the “With

Quantities” form

Tendering

4.4 Tendering takes place based on drawings andspecifications instead of the Contractor pricing bills ofquantities.

4.5 The Contractor is required to supply a schedule ofrates. This requirement is not seen as preventing theemployer from preparing the blank (that is, unpriced)document in which the Contractor enters his rates. TheDepartment considers that the employer’s interest is bestserved if the blank schedule of rates is prepared by theQuantity Surveyor and issued for the Contractor to price.

Priced document

4.6 The schedule of rates is essential to the financialmanagement of the contract, as it is required to be usedin the valuation of variations and of expenditure ofprovisional sums, and in the final adjustment of thecontract sum.

4.7 It is recommended that the schedule of rates shouldbe returned at the same time as the tender but in aseparate package endorsed with he tenderer’s name. In

this way, the schedule of rates of tenders not consideredfor acceptance can be returned unopened.

4.8 It is considered that the employer can be bestassured that the schedule of rates separately identifies allthe items and their rates and prices that may need to bereferred to in using the document for the purposes whichthe contract requires if it is examined by the QuantitySurveyor prior to acceptance of the tender.

21

4.0 GC/Works/1 (Edition 3): General Conditions ofContract for Building and Civil Engineering StandardForm of Contract – Lump sum without Quantities

1.0 This appendix lists the GC/Works/1 (Edition 3)supplementary conditions that may be applicable for usewith the above contract.

Supplementary conditions

a. Supplementary Condition No 146(M)(3): VOPFormula Price Adjustment on Building Contracts;

b. Supplementary Condition No 146(S)(3): VOPFormula Price Adjustment for nominated WorksSub-Contracts for Building Contracts;

c. Supplementary Condition No 147(S)(3): VOPFormula Price Adjustment for nominated Sub-Contracts for Electrical Installations;

d. Supplementary Condition No 148(S)(3): VOPFormula Price Adjustment for nominated Sub-Contracts for Heating, Ventilating and/or AirConditioning Installations;

e. Supplementary Condition No 148(S)(3): VOPFormula Price Adjustment for Sprinkler Installation;

f. Supplementary Condition No 149(S)(3): VOPFormula Price Adjustment for nominated Sub-Contracts for Lift Installations;

g. Supplementary Condition No 150(S)(3): VOPFormula Price Adjustment for nominated Sub-Contracts for Structured Steelwork InstallationsBuildings – Works;

h. Supplementary Condition No 154(S)(3): VOPFormula Price Adjustment for nominated Sub-Contracts for Catering Equipment Installations;

i. Supplementary Condition No 155(S)(3): VOPFormula Price Adjustment for nominated Sub-Contracts for Specialist Engineering Installations.

22

Appendix 1 – GC/Works/1 (Edition 3) SupplementaryConditions

1. Bibliography of additional recommended readingand addresses where the various documents listed may bepurchased.

National Joint Consultative Committee for Building (NJCC)Code of Procedure for Single Stage Selective Tendering.RIBA Publications Ltd 1994

GC/Works/1 (Edition 3). The Stationery Office

Concode: Contracts and commissions for the NHS estate –Policy. The Stationery Office 1993

Concode: Contracts and commissions for the NHS estate –Contract procedures. The Stationery Office 1994

Concode: Guide to procedures for commissioning buildingand engineering consultants. The Stationery Office 1994

Concode: Contracts and commissions for the NHS estate –Guide to the requirements of the European CommunityPublic Procurement Directives. The Stationery Office 1995

Scotland: The Scottish Capital Investment Manual

ScotConcode: MEL (1996)88.

23

Appendix 2 – Bibliography

1. The following amendments should be made toGC/Works/1 (Edition 3) in order to comply withGovernment requirements regarding prompt payment ofsub-contractors.


a. Condition 62 (2)

(i) After the first sentence insert “No subcontract shallinclude any provision purporting to make paymentunder the subcontract conditional on the payerreceiving payment from a third person unless thatthird person, or any other person payment bywhom is under the subcontract (directly orindirectly) a condition of payment by that thirdperson, is insolvent within the meaning of [Section110 (Prohibition of Conditional Payments) of theHousing Grants, Construction and Regeneration Act1996].

(ii) insert the following condition after condition62(2)(f).

(g) Provisions entitling the sub-contractor to stagepayments for any work under the subcontractunless:

(a) It is specified in the subcontract that theduration of the work is to be less than 60 days;or

(b) it is agreed between the Contractor and thesub-contractor that the duration of the work isestimated to be less than 60 days;

and stipulating the amounts of the stage paymentsand the intervals at which, or circumstances inwhich, they become due.

(h) Terms and conditions:

(a) providing an adequate mechanism fordetermining what payments become due underthe sub-contract, and when; and

(b) providing for a final date for payments inrelation to any sum which becomes due;

and stipulating how long the period is to bebetween the date on which a sum becomes dueand the final date for payment.

(j) Any sub-contract terms and conditions, or form ofsub-contract, prescribed by the contract.

24

Appendix 3 – Prompt payment

1. The following amendments should be made toGC/Works/1 (Edition 3) in order to comply with theHousing Grants, Construction and Regeneration Act 1996.

Condition 59: Adjudication

(1) The Contractor or Authority may by notice ask forany dispute, difference or question arising out of, orrelating to, the Contract during the course of theWorks to be referred to the adjudication of aperson to be agreed between the parties asadjudicator, or, failing agreement within 14 days ofthe notice to the person named in the Abstract ofParticulars.

(2) The notice shall specify the matter in dispute andshall set out the principal facts and argumentsrelating to it. Copies of all relevant documents inthe possession of the party shall be attached to thenotice. A copy of the notice and enclosures shall besent by the party giving the notice to theArchitect/Contract Administrator, the QuantitySurveyor and the other party.

(3) The Architect/Contract Administrator, the QuantitySurveyor and the other party may submitrepresentations to the adjudicator not later than 7 days from the receipt of the notice.

(4) The adjudicator shall notify his decision (for whichhe need not give reasons) to the Architect/ContractAdministrator, the Quantity Surveyor, the Authority and the Contractor not earlier than 10 and in anyevent not later than 28 days from receipt of thenotice. The decision shall state how the cost of theadjudicator’s salary (including overheads) or fee shallbe apportioned between the parties. Each partyshall otherwise bear his own costs of adjudication.

(5) In coming to a decision the adjudicator shall haveregard to how far the parties have complied withany procedures in the Contract relevant to thematter in dispute and to what extent each of themhas acted promptly, reasonably and in good faith.

(6) The decision of the adjudicator on any matterreferred to him will be binding unless and untilvaried or overruled in arbitration or litigation.

(7) The Authority and the Contractor shall complyforthwith with any decision of the adjudicator.

25

Appendix 4 – Adjudication

1. The following amendments should be made toGC/Works/1 (Edition 3) to avoid confusion over the term“Project Manager”.

Contents

CONDITION

Instructions and Payment

Delete“40 PM’s Instructions”

Insert“40 Architect/Contract Administrator’s Instructions”

Condition 1: Definitions etc

Insert the following definition after (d) of the definition of“Abstract of Particulars”:

“the Architect” means the person entitled to theuse of the name “Architect” and named in theAbstract of Particulars, and appointed by theAuthority to act on his behalf in carrying out thoseduties described in the Contract (subject to theexclusions set out in the Abstract of Particulars), orsuch other person as may be appointed in thatcapacity of the time being by the Authority;”

Insert the following definition after the definition of “theContract”:

“the Contract Administrator” means the personnamed in the Abstract of Particulars, and appointedby the Authority to act on his behalf in carrying outthose duties described in the Contract (subject tothe exclusions set out in the Abstract of Particulars),or such other person as may be appointed in thatcapacity of the time being by the Authority;”

In the second line of the definition of “Instruction”, delete“(PM’s Instructions)” and insert “(Architect’s/ContractAdministrator’s Instructions)”;

Delete the definition of “the PM” in its entirety;

In the third line of the definition “the Programme” delete“PM” and insert “Architect/Contract Administrator”;

In the second line of the definition of “UnforeseeableGround Conditions” delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (4) line 3, delete “PM” and insert“Architect/Contract Administrator”.

Condition 2: Contract Documents

In sub-condition (2) line 1 delete “PM” and insert“Architect/Contract Administrator”;


In sub-condition (5) lines 1, 4 and 5 delete “PM” andinsert “Architect/Contract Administrator”.

Condition 4: Delegations and Representatives


In sub-condition (2) lines 1, 3 and 4 delete “PM” andinsert “Architect/Contract Administrator”;

In sub-condition (3) line 1 delete “PM” and insert“Architect/Contract Administrator”.

Condition 5: Contractor’s agent

In line 3 delete “PM” and insert “Architect/ContractAdministrator”.

Condition 6: Contractor’s employees

In sub-condition (1) lines 1, 3 and 4 delete “PM” andinsert “Architect/Contract Administrator”;


Condition 7: Conditions affecting works

In sub-condition (3)(i) delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (4) lines 1 and 5 delete “PM” and insert“Architect/Contract Administrator”;

26

Appendix 5 – Project Manager (Architect/ContractAdministrator)


Condition 9: Setting out


Condition 10: Design

In sub-condition (1) lines 4 (twice), 7, 8 and 9 delete“PM” and insert “Architect/Contract Administrator”.

Condition 15: Returns

In lines 1 and 2 delete “PM” and insert “Architect/Contract Administrator”.

Condition 16: Foundations


Condition 17: Covering Work

In lines 1 and 3 delete “PM” and insert“Architect/Contract Administrator”.

Condition 25: Records



Condition 26: Site Admittance


In sub-condition (2) lines 1 (twice) and line 4 delete “PM”and insert “Architect/Contract Administrator”;

In sub-condition (3) in line 1 delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (4) in line 2 delete “PM” and insert“Architect/Contract Administrator”.

Condition 27: Passes

In lines 1, 2, 3 and 5 delete “PM” and insert“Architect/Contract Administrator”.

Condition 28: Photographs


Condition 30: Vesting

In sub-condition (4) lines 2 (twice) and 4 delete “PM”’ andinsert “Architect/Contract Administrator”.

Condition 31: Quality

In sub-condition (3) line 2 delete “PM”’ and insert“Architect/Contract Administrator”;

In sub-condition (4) lines 1 (twice), 3, 7 and 8 delete“PM” and insert “Architect/Contract Administrator”;


In sub-condition (7)(a) line 2 delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (7)(b) line 2 delete “PM” and insert“Architect/Contract Administrator”.

Condition 32: Excavations

In sub-condition (3)(d) line 1 delete “PM” and insert“Architect/Contract Administrator”;


Condition 33: Programme


In sub-condition 3 line 2 delete “PM’s” and insert“Architect’s/Contract Administrator’s”.

Condition 34: Commencement and Completion



Condition 35: Progress meetings


27

Appendix 5 – Project Manager (Architect/Contract Administrator)



In sub-condition (4)(b) line 1 delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (4)(c) line 1 delete “PM” and insert“Architect/Contract Administrator”.

Condition 36: Extensions of time



In sub-condition (2)(b) delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (3) delete “PM” and insert (twice)“Architect/Contract Administrator”;


In sub-condition (5) lines 3 and 4 delete “PM” and insert“Architect/Contract Administrator”.

Condition 37: Early Possession


In sub-condition (1)(b) line 2 delete “PM” and insert“Architect/Contract Administrator”;




In sub-condition (6)(b)line 1 delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (7) line l delete “PM” and insert“Architect/Contract Administrator”.

Condition 39: Certifying Work


Condition 40: PM’s Instructions

Delete heading and insert “Condition 40:Architects’/Contract Administrators’ Instructions”;


In sub-condition (2)(0) line 1 delete “PM” and insert“Architect/Contract Administrator”;



Condition 42: Valuation of Variation Instructions

In sub-condition (1)(a) lines 1 and 3 delete “PM” and“PM’s” and insert “Architect/Contract Administrator” and“Architect’s/Contract Administrator’s”;



Condition 45: VAT


Condition 46: Prolongation and disruption


In sub-condition (2)(c) line 1 delete “PM” and insert“Architect/Contract Administrator”;



28


Condition 47: Finance Charges



Condition 48: Advances on Account




In sub-condition (6) lines 2, 5 and 6 delete “PM” andinsert “Architect/Contract Administrator”.

Condition 49: Final Account




Condition 50: Certifying Payments




Condition 52: Cost Savings




In sub-condition (4)(b) delete “PM” and insert“Architect/Contract Administrator”.

Condition 53: Non-Compliance with Instructions


Condition 54: Emergency Work


Condition 56: Determination


Condition 57: Consequences of Determination forDefault

In sub-condition (1)(d) line 2 delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (1)(e) line 1 delete “PM” and insert“Architect/Contract Administrator”;

In sub-condition (2)(a) line 1 delete “PM” and insert“Architect/Contract Administrator”.

Condition 58: Consequence of other Determination

In sub-condition (2)(a) line 1 delete “PM” and insert“Architect/Contract Administrator”.





29



Condition 63: Nomination



Condition 64: Provisional Sums


Index – Part 1: General

After “Arbitration” and before “Assignment” insert thefollowing:

“Architect/Contract Administrator:

definition of 1

instructions of 40

non-compliance with instructions 41, 42, 43

valuation of Architect’s/Contract Administrator’s instructions 41, 42, 43”;

and delete the following:

“PM:

definition of 1

instructions of 40

non-compliance with instructions 41, 42, 43

valuation of PM’s instructions 41, 42, 43”.

Index – Part 2: Time Limits

Condition 35(3) under “Subject” delete “PM” and insert“Architect/Contract Administrator”;

Condition 35(4) under “Imposed on” delete “PM” andinsert “Architect/Contract Administrator”;







Condition 59(5) under “Subject” delete “PM” and insert“Architect/Contract Administrator”.

Model Form

Abstract of Particulars and Addendum

Delete “The Project Manager shall be” and insert “TheArchitect/Contract Administrator shall be”;

In line 3 of the paragraph beginning “Other than theservices . . .” delete “PM” and insert “Architect/ContractAdministrator”;

At the end of the paragraph beginning “The MaintenancePeriod . . .” delete “PM” and insert “Architect/ContractAdministrator”.

Addendum to Abstract of Particulars

Schedule of Design Information


30



1. Introduction

1.1 A bond is a legally enforceable financial guaranteegiven by a third party (the guarantor) to a purchaser (theclient) to guarantee the obligations of a supplier of goods,works or services (the contractor) under a contract. Theguarantor agrees to pay the client a sum of money if theContractor defaults on their obligations. The purpose ofrequiring a bond is to help the client meet the extraexpenses to remedy the default and/or complete thecontract.

2. Scope of guidance

2.1 This guidance covers some of the practicalconsiderations in respect of the use of bonds, the issue ofcalling “on demand”, and deals with five types of bond orguarantee:

a. unconditional on-demand bonds;

b. performance bonds;

c. parent company guarantees;

d. advance payment bonds;

e. retention bonds.

2.2 Performance bonds are not recommended for useby NHS bodies as a result of the requirement to carry outproper financial and technical checks as part of theselection and appointment procedures for contractors.However, if exceptional circumstances do arise and anNHS body requires a performance bond, they are stronglyadvised to seek appropriate professional and legal adviceon the use, choice and drafting of a bond for a particularcontract.

3. Practical considerations

3.1 Bonds are generally provided by the financialmarket, either by a bank or by a surety company. TheContractor and the guarantor will seek to establish theterms and conditions under which the bond can be called.Employers, for their part, should want to know that theguarantor issuing the bond is a sound, reliable andresponsible corporate body and be satisfied that if there isneed to call the bond for payment, the guarantor willcomply promptly.

3.2 There are at present no standard forms of bond foruse in the NHS. The wording of commercial bonds can

vary depending on which organisation is providing thebond, who is involved in drawing it up, and what thebond is expect to deliver. There is often intensenegotiation over the precise wording of bonds, and legaladvisers should always be involved.

3.3 Generally, the additional cost of a bond is relativelysmall in comparison with the price of the contract. Thiswill depend to some extent on the terms and conditionsthe client requires (whether the bond is on-default, or –more onerous – on-demand) and the degree of risk theguarantor attaches to the ability of the contractor to givea counter-indemnity and to repay any sum that is called.

3.4 The size of the bond is very important, because thisimpacts on a contractor’s bonding capacity. To require alarge value bond has the same effect as an equivalentnumber of smaller bonds. Generally, contractors will beunwilling to use up their bonding line on large bonds forsmaller projects, and this can restrict competition.

3.5 In most cases, on-demand bonds are provided bybanks, who may regard them as open credit notes andmay require provisions to be made from borrowingfacilities against contingent liabilities. This can affect thecontractor’s financial resources and their ability tocompete for and undertake other work. A requirement foran on-demand bond may therefore deter firms whowould otherwise have tendered for the contract and/orinhibit their ability to tender in the future.

3.6 In raising a bond or a line of bonding credit from abank or a surety company, the Contractor may undergoindependent professional financial vetting. Whilst theextent or the cover which the market is willing to providemay give some indication of the contractor’s financialstanding and prospects, the procedures applied varygreatly and will not always involve a detailed check ofperformance or record.

3.7 A guiding principle of procurement best practice isthat normally a contract should not be placed with acontractor if there are reasonable doubts about thecontractor’s ability to meet the terms and conditions ofthe contract satisfactorily. Such doubts may arise inrelation to the adequacy of the contractor’s managementand technical resources to deliver on time and to therequired quality standard, or where information availablesuggests that the contractor may have inadequatefinancial resources, with consequent risk to Exchequerfunds.

31

Appendix 6 – The use of bonds and guarantees in NHScontracts

4. Unconditional on-demand bonds

4.1 The terms and conditions of a bond determine thecircumstances and mechanism by which the bond can becalled. An unconditional on-demand bond allows theclient to call the bond at any time. Unconditional on-demand bonds are only provided by banks and are ineffect certified cheques.

4.2 Because they are not linked to the performance ofthe contractor, unconditional on-demand bonds can becalled by the client at any time and without having toshow any cause or justification. The findings of the courtshave been consistent that there is no implied requirementfor the calling to be fair or reasonable. Unconditional on-demand bonds can therefore be used unfairly, usually as athreat to persuade the contractor to do something theywould not otherwise do, or which they are not contractedto do.

4.3 Unconditional on-demand bonds are essentiallyunfair and should not be used in NHS procurement.

5. Performance bonds

5.1 A performance bond is usually provided at contractaward, for an agreement percentage of the total contractvalue (normally about 10 per cent). Normally the valuedoes not reduce, but performance bonds should have anexpiry date (not necessarily a calendar date – it can belinked to an event so that time slippage is automaticallytaken into account). If the value of the contract increases,or the duration of the contract extends, the value of thebond needs to be amended accordingly.

5.2 A performance bond will not of itself ensure thatcontracts are carried out efficiently and to time, but it willbe one of a number of commercial pressures on thecontractor to perform well. A performance bond canprovide some compensation if the contractor defaults ontheir obligations.

5.3 There are two basic forms of performance bond:the “conditional on-default bond” and the much moreonerous “conditional on-demand bond”.

Conditional on-default performance bonds

5.4 Usually these can only be called following a seriousbreach by the contractor of the agreed terms andconditions of the contract (which will include becomingbankrupt and would normally allow the client to terminatethe contract).

5.5 Conditional on-default performance bonds are fairlycommon within UK industry and are mainly provided bysurety companies. They have been criticised because theyare often written in outdated and obscure language. Thishas meant that when calls have been made, guarantorshave sometimes looked to the wording of the bond forreasons not to pay.

5.6 Properly expressed conditional on-defaultperformance bonds provide a third-party guarantee thatthe contractor will not default from a contract they havefreely entered into. They should be required where thereare identifiable risks of default by the contractor, subjectto value-for-money considerations. Legal advice should beobtained to ensure that the wording clearly expresses thetrue transaction and not assume that “traditional”wording will be appropriate. They must be prepared topursue this with the guarantor.

Conditional on-demand performance bonds

5.7 These are bonds which although “on-demand”should include within their terms and conditions:

• a mechanism for calling (so that the bond may becalled only if certain procedures have beenfollowed, requiring senior personnel within theclient’s organisation to approve the calling);

• a requirement for the client to identify the reasonfor calling (which reason may be questioned andcontested);

• a cooling-off period (during which the contractormay remedy the default).

5.8 There is a place for the use of conditional on-demand performance bonds where the cost or otherconsequences of default by the contractor are very highand, provided it is properly called, the guaranteed sumwill be paid without risk of dispute. Such bonds retainsome features of an unconditional on-demand bond. Theycan be called at the sole discretion of the client, but onlyif the agreed conditions for calling are met. This shouldprevent the client from acting in an arbitrary orunreasonable way and protect the contractor from thebond being called without the due and properconsideration of responsible people in the client’sorganisation. A cooling-off period should allow thecontractor time to investigate and remedy the default.

5.9 Employers should be aware of the burden that on-demand bonds can place on a contractor. Conditional on-demand performance bonds should be used sparingly onhigh risk and/or high value projects where the costsand/or other consequences of default by the contractor

32

Appendix 6 – The use of bonds and guarantees in NHS contracts


are high, and only after careful consideration, includingappropriate professional and legal advice.

6. Parent company guarantees

6.1 This form of guarantee is given by a parentcompany (or holding company) to guarantee the properperformance of a contract by one of its subsidiaries (thecontractor), and can only be given where the contractor isowned by a parent company or is the subsidiary of alarger group. Such a guarantee is free of cost to the clientbut may give less certainty of redress than a bond becauseit is not supplied by an independent third party. However,whilst accepting less independence, parent companyguarantees for the proper performance of the contractcan be more advantageous than bonds. Rather thanreceiving a fixed amount in compensation, the parentcompany is obliged to complete the contract (seeparagraph 6.3 below). Costs for completion are borne bythe parent company – and these costs may be significantlymore than the compensation provided for in a bond. Inaddition, further recompense can be sought for timedelays in completion through the normal clausesincorporated in the contract.

6.2 The conditions of a parent company guarantee willusually give the parent company the opportunity toremedy any default within a period of notice before theguarantee of completion of the project itself, or theemployment of another contractor to complete theproject.

6.3 Where problems arise under the contract, this formof guarantee should discourage the parent company fromputting the contractor into liquidation solely to avoidlosses in completing the project or in paying damages forlate or non-completion. Provided that the parent companyis financially sound and the guarantee is properly worded,the performance and the completion of the contract canbe safeguarded, but the way in which the project iscompleted if the contractor defaults can, to some extent,be at the discretion of the parent company.

6.4 Because the financial strength of the parentcompany may be linked to that of the contractor, a parentcompany guarantee will be acceptable only if the parentcompany (or holding company) is financially strong and itsfinancial resources are largely independent of those of thecontractor.

6.5 NHS bodies should be aware when vettingcontractors that a parent company guarantee is only asgood as the parent company (or holding company) itself.If the financial position of the holding company is

inadequate, the guarantee should be given by theultimate parent company, if this is justified by its ownfinancial standing.

7. Advance payment bonds

7.1 The Treasury has issued guidance explaining whyadvance payments should be avoided (see DAO letter8/93, dated 2 June 1993 – extract attached) and hasinformed the Public Accounts Committee that “anyadvance payment made under a contract should besecured by a bank guarantee”.

7.2 Where the advance payment reduces with time as,for example, stage payments are made against goodsand/or services delivered under the contract, the value ofthe guarantee should reduce to reflect the outstandingamount of the advance payment.

7.3 Normal practice is to require a conditional reducingon-demand advance payment bond issued by a bank sothat provided it is properly called, the guaranteed sum willbe paid without risk of dispute.

7.4 Advance payments should be avoided whereverpossible. In all cases where they cannot, they must beindependently secured by a conditional on-demandadvance payment bond issued by a bank. Legal adviceshould be obtained to ensure that the wording expressesthe true intention of the transaction.

8. Retention bonds

8.1 These bonds are still rare in the UK, but their use islikely to increase. They are provided so that contractors(and their sub-contractors) may be paid without the clientdeducting retention money. As work is completed, thecontractor is paid fully under the terms of the contract.Normal practice is to provide conditional retention bondsissued by a surety company that increase in value aspayments are made in accordance with the contract. The client is protected against default at the end of thedefects liability or guaranteed maintenance period up tothe amount of the bond.

8.2 The traditional retention system is to withhold apercentage from payments made during the course of thecontract to accumulate a fund that is available to theclient if the contractor fails to rectify defects in accordancewith the contract (typically 3.0 to 5.0 per cent of the valueof the contractor’s work up to certified completion,reducing to 1.5 to 2.5 per cent up to final acceptance).Usually, the first moiety of retained money is released to

33



the contractor on certified practical completion and thesecond on final acceptance that the contractor hasfulfilled its contracted obligations. The cost of thatanticipated loss of cash flow is reflected in a contractor’stender pricing. Retention bonds give contractors betterand more certain cash flow through full payment at allstages (without the deduction of retention money).

8.3 The use of retention bonds transfers financing costfrom the contractor to the client (who is required to payin full earlier) and will pass cash-flow benefits to thecontractor. Their use will only result in a lower cost to theclient if contractors are prepared to reduce their tenderprices accordingly. The option to offer a retention bondshould be included in the tender documents at enquirystage.

8.4 The conditions of a retention bond should relievethe client from failure by the Contractor to rectify defectsin accordance with the contract up to the value of thebond. NHS bodies will need to consider the balance ofcosts and benefits in deciding whether to require and/oraccept retention bonds. When used they should beconditional on-demand, issued by a surety company. Legaladvice should be obtained to ensure that the wordingexpresses the true intention of the transaction.

34


35


Extract from DAO Letter 8/93 dated

2 June 1993

Advance payments

1. The term advance payment is used to describepayments made to contractors before the customer hasreceived equivalent value in return. An advance paymentprovides a contractor with working capital, to enable thecommitments under the terms of a contract to be fulfilled.

2. The term interim payment is used to describepayments which are made at prescribed stages or intervalsduring the progress of a project. They are normally linkedto work done and/or physical progress satisfactorilyachieved, as defined in the contract.

3. Subject to the Government’s policy that whenpayments have become due they should be madepromptly, payment is as a general rule made in arrearsafter the specified goods or services have beensatisfactorily provided, unless the contract provides forinterim payments (see paragraphs 15–19 below).However, suppliers sometimes seek advance payments,usually in return for a price discount.

4. Subject to the Government’s policy that whenpayments have become due they should be madepromptly, payment is as a general rule made in arrearsafter the specified goods or services have beensatisfactorily provided, unless the contract provides forinterim payments (see paragraphs 15–20 below).However, suppliers sometimes seek advance payments,usually in return for a price discount.

5. An advance payment will lead to higher Exchequerfinancing costs. Requests for advance payments should berejected in any cases where the extra financing cost fallingon the Exchequer exceeds the value of the discount. Evenif the discount offered by a contractor appears to begreater than the extra Exchequer cost of paying inadvance, it is not Government policy to act as a source ofloan finance for contracts in competition with the marketand advance payments should be resisted.

6. EC public procurement rules demand a level playingfield in the letting of public contract above a stipulatedfinancial threshold. If an advance payment is to be offeredfor a particular requirement, this should be made knownat the time tender documents are issued to all potentialsuppliers. It would not be acceptable for an advancepayment to be offered to the successful contractor tosecure a further price advantage.

7. Although advance payments are the normal practicein certain types of procurement, such as internationalcontracts for capital works and contracts for the design,

manufacture and supply of heavy capital equipment, theseare areas in which most central Government departmentsare not normally involved.

8. Advance payment by Government departmentsshould therefore be very much the exception. In any caseswhere departments feel that such payment may bedesirable, they should carry out a financial appraisal toestablish whether there is a value for money case. Foradvance payments, the appropriate cost of Governmentlending is the National Loan Fund rate plus 2 per cent (seeAnnex G, paragraph 12 (iv) of the Treasury’s guide“Economic Appraisal in Central Government – A TechnicalGuide for Government Departments” (the Green Book)).NLF rates are available from the Treasury’s MonetaryGroup.

9. If they wish to proceed, departments should ensurethat they seek the approval of the Treasury, unless theyhave the appropriate delegated authority to do so.Advance payments should never be used for the purposeof avoiding an underspend in a particular financial year bymaking a payment before the liability to pay has matured.

10. Where, exceptionally, an advance payment is made,departments should ensure that adequate steps are takento protect the taxpayers’ money. The intended purpose ofthe advance payment should be stipulated clearly in thecontract. Unless adequate guarantees are obtained, thedepartment may receive nothing in the event of thecontractor going into liquidation or otherwise failing tomeet its contractual obligations. The Treasury hasinformed the Public Accounts Committee, in theGovernment’s reply to the Committee’s 13th report,1990–91 (A New Ship for St Helena), that it “considersthat any advance payment made under contract should besecured under an adequate bank guarantee (and that insuch cases the contract should require that the advancepayment is not itself used as security for the bankguarantee)”.

11. Departments should act accordingly, typically byrequiring a bond or financial guarantee issued by areputable bank for the value of the advance, and payablein the event of the contractor’s non-performance.Departments should note that the cost of such aguarantee is bound to be reflected in the overall contractprice, thus eroding some of the price advantage that mayappear to make the advance payment attractive.Departments should consult their legal advisers about theterms of any guarantee, to ensure that their interests areprotected fully and the undertakings given to the PublicAccounts Committee are fulfilled.

12. Some service and maintenance contracts typicallyrequire payments at the point the contract commences.Payments made under such contracts are not subject tothe advance payment rules set out in paragraphs 4 to 11

the advance payment rules set out in paragraphs 4 to 11above, provided the service is already operationallyavailable and can be called on from the date of payment.Consideration should be given to whether the guaranteearrangements at paragraph 11 may be appropriate and,wherever possible, departments should seek alternativearrangements (e.g. quarterly payments in arrears) forthese types of contract.

13. The above guidance does not apply in relation togrants or grants in aid to NDPBs and other institutions,such as local authorities; to the prefunding of other publicsector bodies in relation to functions which they carry outon behalf of departments; or to inter-departmenttransactions. The arrangements for the timing andphasing of such payments should be set out in thefinancial memorandum or any other documentationbetween the department and the body concerned (seeGovernment Accounting paragraph 21.2.6(c)). Theguidance is also not intended to preclude departmentsfrom exercising sensible discretion on payment in advancefor minor services such as training courses, attendance atconferences, etc, but such payments should not be madein advance of need.

14. Special considerations may apply in joint venturecases covered by the guidance for departments issued bythe Treasury on 16 March 1993. Further guidance on thetiming of payment in such cases will be issued by theTreasury in due course. In the meantime, the Treasuryshould be consulted by departments if a joint venturewould appear to involve an advance payment as definedin paragraph 1 above.

15. Where it is decided, in the light of theseconsiderations, that interim payments would provide valuefor money, adequate contractual conditions should bedrawn up to protect the Department's position. Paymentsof this sort should be framed within the contract as ‘apayment on account towards the total price’ rather than afinal payment for part of the work done, as this willensure that they are subject to review and arerecoverable, if necessary. Interim payments should berelated to value already received and wherever possible belinked firmly to physical performance. Payment on thebasis of elapsed time should be avoided as it encouragesthe contractor to let completion slip. If progress slipsdepartments should not seek to avoid an underspend in aparticular financial year by making interim paymentsbefore the relevant physical performance has beenachieved.

16. Departments should seek to ensure in contractconditions that ownership of the assets (goods,intellectual property, etc) covered by each interim paymentis transferred to the department when payment is made.They also ensure that the arrangements do not detractfrom or obviate the obligations on the contractor under

the Government's prompt payment policy, for paying hisown suppliers and contractors promptly.

17. Departments should also consider whether contractperformance should be covered by a performance bond inthe form of a guarantee (issued by a bank or suretycompany), which can be ‘called’ if the contractor'sperformance under the contract is not satisfactory.Departments should consult their legal advisers about theterms of any guarantee, to ensure that their interests areprotected fully. The need for a guarantee should beconsidered on the merits of the case taking account of therisks involved from a breach of contract (for example theextra costs likely to be incurred to complete the projectsatisfactorily), together with the costs of the guarantee(which the contractor will pass on to the customer).

18. It is the responsibility of project managers to ensurethat expenditure on a project is fully matched whereverpossible by physical performance. A comparison of therate of actual expenditure with the forecast rate ofexpenditure is not relevant to the appraisal of projectmanager's performance.

19. A number of departments have already adoptedthese principles and have achieved significant benefits.Their application has meant that payments are not madebefore they are justified; and has resulted in more realisticestimates of cost and time and a greater likelihood ofcompletion within budget and on time.

36


References

Acts and Regulations

Architects Registration Act 1931. The Stationery Office,1931. (printed on demand)

Architects Registration Act 1938. The Stationery Office,1938. (printed on demand)

Housing Grants, Construction and Regeneration Act1996. The Stationery Office, 1996.

Race Relations Act 1976. The Stationery Office, 1976.(printed on demand)

British Standards

BS EN ISO 9000 Quality management and qualityassurance standards.

NHS Estates, Department of Health and

Scottish Office publications

Concode: Contracts and commissions for the NHSEstate – Policy. NHS Estates, The Stationery Office 1993.

Concode: Contracts and commissions for the NHSEstate – Contract procedures. NHS Estates, TheStationery Office 1994.

Concode: Guide to contract procedures. NHS Estates,The Stationery Office 1996.

Concode: Guide to procedures for commissioningbuilding and engineering consultants. NHS Estates,The Stationery Office 1996.

Concode: Guide to the requirements of EuropeanCommunity public procurement directives. NHSEstates, The Stationery Office 1995.

Capital Investment ManualOverview. NHS Executive, The Stationery Office1994. Project organisation. NHS Executive, The StationeryOffice 1994. Private finance guide. NHS Executive, The StationeryOffice 1994.Business case guide. NHS Executive, The StationeryOffice 1994. Management of construction projects. NHS Estates,

The Stationery Office 1994.Commissioning of a health care facility. NHSExecutive, The Stationery Office 1994. IM&T Guidance. NHS Executive, The StationeryOffice 1994. Post project evaluation. NHS Executive, TheStationery Office 1994.

User manual (Health Technical Memorandum 54.1).NHS Estates, The Stationery Office, 1995.

Scottish Capital Investment ManualOverview. NHS in Scotland Management Executive(in preparation)Project organisation. NHS in Scotland ManagementExecutive (in preparation)Private finance guide. NHS in Scotland ManagementExecutive (in preparation)Business case guide. NHS in Scotland ManagementExecutive, The Stationery Office 1996.Management of construction projects. NHS inScotland Management Executive, (in preparation)Commissioning of a health care facility. NHS inScotland Management Executive, (in preparation)IM&T Guide. NHS in Scotland ManagementExecutive, The Stationery Office 1996. Post project evaluation. NHS in ScotlandManagement Executive, (in preparation)

ScotConcode. NHS in Scotland Management Executive,The Stationery Office 1997.

Miscellaneous publications

Standard fire precautions P5. Revisied Edition,Department of the Environment, The Stationery Office1988.

Co-ordinated project information for building works,a guide with examples. Coordinating Committee forProject Information, Royal Institute of British Architects(RIBA) Publications Ltd. 1988.

Economic appraisal in central government – technicalguide for government departments (the GreenBook). HM Treasury, The Stationery Office, 1991. (newedition in preparation)

General conditions of contract for building and civilengineering standard form of contract – lump sumwithout quantities (GC/Works/1(edition 3)).

37

Department of the Environment, The Stationery Office1991.

General conditions of contract for building and civilengineering standard form of contract – lump sumwith quantities (GC/Works/1(edition 3)). Departmentof the Environment, The Stationery Office 1990.

General conditions of contract for building and civilengineering standard form of contract – single stagedesign and build (GC/Works/1(edition 3)). Departmentof the Environment, The Stationery Office 1993.

38

References

39

Given below are details of other documents in theConcode series which are either published by TheStationery Office or in preparation. Information is correctat the time of publication of this document.

Contracts and commissions for the NHS estate: Policy,1993

Agreement for the appointment of project managers forcommissions for construction projects in the NationalHealth Service, 1995

Guide to the Agreement for the appointment ofarchitects, surveyors and engineers for commissions in theNational Health Service, 1995

Guide to the Agreement for the appointment of projectmanagers for commissions for construction projects in theNational Health Service, 1995

Agreement for the appointment of architects, surveyorsand engineers for commissions in the NHS.

Vol 1: Scheme particulars, memorandum ofagreement, conditions of appointment, provisionfor fees and expenses, specimen certificates,definitions, 1995

Vol 2: Supplementary annexure, 1995

Vol 3: Duties under the Construction (Design andManagement) Regulations 1994, 1996

Contracts and commissions for the NHS estate: Contractprocedures, 1994

Guide to procedures for commissioning building andengineering consultants, 1994

Guide to the requirements of European Community publicprocurement directives, 1995

Guide to contract strategies for construction projects inthe NHS, 1995

Guide to the JCT Standard Form of Building Contract,1980 Edition, Local Authorities (as amended), 1995

Guide to the JCT Standard Form of Building ContractWith Contractor’s Design 1981 Edition (as amended),1996

Agreement for the appointment of architects, surveyorsand engineers for commissions for minor works in theNHS, 1996

Guide to the JCT Agreement for minor building works,1994 (new edition in preparation)

Guide to the JCT Intermediate Form of Building Contractfor works of simple content 1984 Edition (as amended),1996

Guide to contract procedures, 1996

Documents published by The Stationery Office can bepurchased from Stationery Office Bookshops in London(post orders to PO Box 276, SW8 5DT), Edinburgh,Belfast, Manchester, Birmingham, Bristol and Cardiff, orthrough good booksellers.

Enquiries (but not orders) should be addressed to:NHS Estates, Department of Health, 1 Trevelyan Square,Boar Lane, Leeds LS1 6AE.

NHS Estates is a non-profit-making Executive Agency ofthe Department of Health.

The price of this publication has been set to make somecontribution to the costs incurred by NHS Estates in itsproduction.

Other publications in this series

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About NHS Estates

NHS Estates is an Executive Agency of the Department ofHealth and is involved with all aspects of health estatemanagement, development and maintenance. The Agencyhas a dynamic fund of knowledge which it has acquiredduring 30 years of working in the field. Using thisknowledge NHS Estates has developed products which areunique in range and depth. These are described below.NHS Estates also makes its experience available to the fieldthrough its consultancy services.

Enquiries about NHS Estates should be addressed to:NHS Estates, Publications Unit, Department of Health, 1 Trevelyan Square, Boar Lane, Leeds LS1 6AE.Telephone 0113 254 7000.http://www.open.gov.uk/nhsest/hpage.htm

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Activity DataBase – a computerised briefing and designsystem for use in health buildings, applicable to both newbuild and refurbishment schemes. NHS Estates

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Estatecode – user manual for managing a health estate.Includes a recommended methodology for propertyappraisal and provides a basis for integration of the estateinto corporate business planning. SO

Concode – outlines proven methods of selecting contractsand commissioning consultants. Reflects official policy oncontract procedures. SO

Works Information Management System – a computerised information system for estatemanagement tasks, enabling tangible assets to be put intothe context of servicing requirements. NHS Estates

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Health Guidance Notes – an occasional series ofpublications which respond to changes in Department ofHealth policy or reflect changing NHS operationalmanagement. Each deals with a specific topic and iscomplementary to a related HTM. SO

Health Technical Memoranda – guidance on thedesign, installation and running of specialised buildingservice systems, and on specialised building components.SO

Health Facilities Notes – debate current and topicalissues of concern across all areas of healthcare provision.SO

Encode – shows how to plan and implement a policy ofenergy efficiency in a building. SO

Firecode – for policy, technical guidance and specialistaspects of fire precautions. SO

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Model Engineering Specifications – comprehensiveadvice used in briefing consultants, contractors andsuppliers of healthcare engineering services to meetDepartmental policy and best practice guidance.NHS Estates

Quarterly Briefing – gives a regular overview on theconstruction industry and an outlook on how this mayaffect building projects in the health sector, in particularthe impact on business prices. Also provides informationon new and revised cost allowances for health buildings.Published four times a year; available on subscriptiondirect from NHS Estates. NHS Estates

Items noted “SO” can be purchased from The StationeryOffice Bookshops in London (post orders to PO Box 276,SW8 5DT), Edinburgh, Belfast, Cardiff, Manchester,Birmingham and Bristol or through good booksellers.

NHS Estates consultancy service

Designed to meet a range of needs from advice on theoversight of estates management functions to a muchfuller collaboration for particularly innovative or exemplaryprojects.

Enquiries should be addressed to: NHS EstatesConsultancy Service (address as above).

Department of Health1 Trevelyan SquareBoar LaneLeedsLS1 6AEFax 0113 254 7299Telephone 0113 254 7000

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