Agreement for Construction of Building

Agreement for Construction of Building

This construction agreement is made on the 5th day of June 2000 between LO, son of AB, residing at ………………………… (hereinafter referred to as owner) of the First Part and XZ, son of MN, residing at ……………… ………… (hereinafter called the contractor) of the Second Part.

Whereas the party of the First Part is the owner of a plot of land measuring …………… at ………………………… and more particularly described in the plan attached and therein delineated in red.

And whereas the owner being desirous of erecting a building on the said plot has appointed Shri AK as the architect who has prepared plans, specifications and drawings for the said proposed building.

And whereas the plans, designs, drawings and elevations of the said intended building and specifications of the works to be done and of the materials to be provided in and for the erection of the said building have been prepared by the said architect sanctioned by the Authorities concerned and approved by the parties herein and have been subscribed for the purposes of identification by both the parties.

And whereas the contractor is willing to enter into an agreement for the execution of the said works in accordance with the Architect’s said plans, specifications and drawings at actual costs plus 20% profit basis.

Now these presents witness and the parties hereby agree as

1. The contractor shall erect on the said plot of land a building in conformity with the sanctioned plans, drawings and elevations and complete all the said works with the material of best quality and in the most substantial and workmanlike manner and to the satisfaction of the said architect and will in all respects comply with and abide by the true intent and manner of the said specifications, plans, drawings and elevations and of this agreement.

2. The contractor will finish and complete the said building on or before the 5th day of June 2001 and if the said building shall not be completed on or before the said date the contractor shall forfeit, out of the moneys which shall be due to him by virtue of this agreement, the sum of Rs. 1000 for every day which shall elapse after the 5th day of June 2001 until the said building shall be completed.  Provided that if the contractor is prevented by any strike among the workmen or by reason of any event beyond his control, the said architect may extend the time for the completion of the works for such reasonable period as he may think fit.

3. If the contractor shall become bankrupt or from any cause whatsoever  be prevented from or is delayed in proceeding with and completing the said works according to the terms and conditions of this agreement, or does not proceed with the said works to the satisfaction of the said architect, it shall be lawful for the said architect to leave or cause to be left at the usual place of abode or business of the contractor, a notice in writing for the said contractor to proceed forthwith and effectually with the said works. In case the said contractor shall, for 7 days after such notice is so left as aforesaid, make default in forthwith and effectually proceeding with the said work it shall be lawful for the said architect to employ any other workmen either by contractor or otherwise to proceed with the said works and complete the same and pay to the said workmen out of the moneys which shall be then due to the said contractor on account of this agreement, the amount of their charges for the same and for all necessary materials to be found and provided for such completion; and if the amount of balance to the credit of the contractor be insufficient to cover such charges for such workmen and materials then in such a case the said contractor shall and will make good and pay such deficiency on demand.

4. If the said architect shall at any time or times consider any of the workmen employed by the said contractor on the works as in any way incompetent or as acting improperly it shall in every such case be lawful for the said architect to discharge such workmen and the said contractor shall without delay put another workman in his place.

5. In case any of the materials brought on the said premises by the said contractor shall be considered by the said architect as unsound or in any respect improper, the said contractor will upon notice in writing to him or his foreman on the premises given by the said architect cause the same to be removed from the ground and proceed with the said works with materials corresponding with the specifications and instructions approved by the said architect and on default of such removal within 7 days after such last mentioned notice, it shall be lawful for the said architect to cause to be removed to such place as he may think proper without being in any way answerable or accountable for the loss or damage that shall happen to any materials so removed and to cause proper materials to be substituted for the same, and to pay all expenses in connection with such removal and substitution out of the moneys which shall become due to the said contractor by virtue of this agreement.

6. In case the said architect shall consider any part of the said works to have been executed in an unsound and improper manner, the said contractor will cause the same immediately to be taken down and executed in a proper manner to the satisfaction of the said architect without any extra charge or expense whatsoever.

7. If the said architect or the owner shall think proper at any time or times to make any alterations or additions or omission in the works hereby contracted for, he or they shall give to the said contractor written instructions for such alterations or omissions signed by the said architect. Any additional charge by the contractor with respect to such alterations if certified to be correct by the architect shall be paid for in the same manner and at the same time as hereinafter expressed for the payment of the ultimate balance of the said sum not exceeding the sum calculated at the agreed rate.

8. Any damage arising from accidents or carelessness of the workmen or otherwise to the said work hereby contracted for or to the materials or implements therein used or to the workmen shall be borne and effectually made good by the said contractor at his own costs and charges.

9. The contractor shall use in the construction best quality materials in accordance with the specifications mentioned herein.

10. The contractor will not without the consent of the said architect make any sub-contract for the execution of the works hereby contracted for or any part thereof nor assign or underlet the present contract or any part thereof.

11. Notwithstanding anything contained herein it will be sole responsibility of the contractor to comply with the provisions of law relating to the construction of the said building in accordance with these presents and the contractor hereby undertakes to keep the owner harmless from and indemnified against any action, claim, loss, damages, expenses howsoever arising for any breach of any statutory provisions, rules or regulations or any term of this agreement.

12. The contractor shall be paid Rs. 5 lakhs as his remuneration for the labour supplied and material used and supervision made by him for the aforesaid building. The payment towards the said construction will be made in the manner following:

Rs. 2 lakhs shall be paid per month of construction work continuing the first instalment to be paid on 10th July 1999 and thereafter by 10th of each succeeding month of construction work being done and the balance, if any, within three months of the completion of the building, provided that in case of each payment the architect certifies that the work and materials to a sufficient amount shall have been done executed or provided by the said contractor to the satisfaction of the said architect. Provided also that the said contractor shall not be entitled to payment or to receive the balance sum or his remuneration until the said architect shall certify under his own hand that the whole of the said works have been completed and finished to his satisfaction and Completion Certificate from the Authorities concerned has been obtained. The decision of the architect shall be binding on the parties and shall be final.

In witness whereof the parties hereto have signed this agreement on the day month and year above-written.

Signed and delivered by LO, the

owner in the presence of :                                                    Sd/- (Owner)

1. ……………………………

2. ……………………………

Signed and delivered by XZ, the

contractor  in the presence of:                                          Sd/- (Contractor)

1. ……………………………

2. ……………………………