2.text Book PPE II - July'15-Nov'15

Professional Practice and Ethics II AR 2501
UNIT I
TENDER FOR CONSTRUCTION
What is Tender?
Tender means an offer to carry out work, that is pre-described or to supply or purchase goods of prefixed
specifications at a price to be quoted the tenderer.
Essential qualities of a good tender:

1. Tender should be based upon definite and detailed information. The items of work described in bill of
quantities included in the tender should be very clear and specific.
2. Drawing shall be supplied wherever details are involved. Wherever description is difficult, drawing should
be given to complement description.
3. All factory made products should be specified as far as possible with their trade name (close
specifications). You may attach a list of approved makes or manufacturers to the tender document.
4. Avoid as far as possible the use of phrase As approved by architect, Instead spell out more in details
your requirements and if needed, supplement the statement by a drawing.
5. Basic price of material shall be mentioned in the tender.
6. The basic concept of tendering is a competition on equal base. Therefore, it is essential that information
given may be in the form of specifications, conditions of work, abstracts, quantities or drawings shall be
same information to all the contractors who shall offer tenders.
Components of a tender: A checklist.

1. Instructions to contractor
1.1 Type of tender (Item rate tender or lumps um tender).
1.2 Location and brief description of work and name of owner. (Name of work, site address and owners
name)
1.3 Price of Blank tender form.
1.4 Amount of Earnest Money Deposit (E.M.D) to be paid to whom and how.
1.5 Time and place of submitting filled in tender.
1.6 Note: Owner reserves right to reject any or all tenders without giving reasons. (This note is important
and shall not be forgotten.)
2. General conditions and preliminaries: Prepared by the architects office. In this, you should not forget to
refer standard specifications, such as ISI or P.W.D. This should also include a list of Basic Rates of major
building materials and a list of approved manufactures of materials.
3. LETTER OF OFFER: From contractor of Architect. This letter is prescribed by architects office. (a specimen
letter given in Appendix 14.I)
4. Copy of Articles of Agreement and General Conditions of contract. (Printed papers available with I.I.A)
5. Bill of Quantities (Contract Bill) only in case of an item rate tender.
6. Drawings (Contract Drawings) giving location, overall size, types of building construction etc. for an item
rate tender. OR In case of lump sum tender, a complete set of working drawings including R.C.C. schedule
or structural steel details etc.
Types of Client:
1. Private or an individual owner.
2. Semi-public organizations
3. Public Bodies such as Government Departments.
Ar. Stanley clement Daniel 1

Different methods of calling tenders:

1. Invited Tender
A list of five or six contractors should be made by the architect in consultation with the owner. Om behalf of
the owner, the architect should write letters to the contractors inviting them to tender for the work.
A letter of invitation to a contractor shall cover the following points.
(i) Name of the owner.
(ii) Address of the site of proposed work and type of building.
(iii) Estimated cost of work.
(iv) Probable date of commencement of work on site.
(v) Price of blank tender form and
(vi) Date, time and place where from the tender copy would be available.
Each of the points has relevance in business. When you invite a contractor for tendering, he has a choice to
accept or to refuse the invitation. For that he should know-
i) Who is the owner, he may have earlier experience, either good or bad with the person. Contractors
decision to accept or to reject the invitation may depend on this
ii) Each contractor has his area of operation in his mind. This depends on the size of his organization and his
willingness to go far and the estimate of projects as well.
iii) The estimate of work is also relevant.
iv) The probable date of commencing work is relevant to know.
2. Public Tender
In case of projects owned by the semi public or the public bodies, in the procedure to be adopted, there
should be no room for favoritism or a partiality. The competition should be open to all. Hence, a notice shall
be published in a newspaper calling the contractors to fill in tender for a project. In such a notice, the
following information shall be given:
1. Name of the client (Owner of the project)
2. Address of the proposed work site and name of the project.
3. Estimated cost of project.
4. Earnest money deposit.
5. Cost of blank tender form.
6. Time and place of issuing blank tender forms.
7. Time and place of submitting filled in tenders.
The biggest disadvantage in a public tender notice is that one does not know the abilities of contractors
offering themselves to work for the project. To get the work, one may quote low rates. But often such a
contractor is unable to carry out the work and to produce work of good standard. Realizing that he is not
making enough profits or he is loosing on the job, the contractor looses an item even at the cost of quality.
The contractor will try to raise claims for variation and extra items, arguing with an architect now and then on
small matters. The owner reserves the right to accept pr to reject any or All the Tenders without giving any
Reasons.
3. Pre-registration of contractors:
In this method, a notice is published in newspaper inviting the contractors to submit the information of their
construction company. In the notice, it is necessary to publish i) Name of the owner and his address, ii) Name
of the project and its estimated cost, iii) Address of construction site and iv) Probable date of starting
construction. Reading this information, the contractor should decide whether he is interested in the work or
not. Further in the notice, the contractors are requested to submit the information on the following points:-
1. Name of the company and its Registered Address, names of partners/ Directors.

2. List of similar projects (similar to the project for which this advertisement is given) or list projects carried
out during last three or five years, with their cost, name of the architect, name of the owner, etc.
3. List of the construction equipments possessed by the company and technically qualified persons employed
with the company.
4. Income tax clearance certificate.
5. Solvency certificate from bankers.
On receiving the applications on the date given in the advertisement, scrutiny is made and a short list of five
or seven contractors that is drawn out. A care should be taken while selecting the contractors that they are of
more or less of equal standing from the point of view experience, establishment, financial strength etc. and
each one of them should be acceptable to the owner.
Papers that are included in a Tender document.

1. Letter of Offer:
This letter is drafted by the architects office. The contractor is supposed to read it carefully and sign it as a
mark of total agreement to it. The contractor shall make no change in the text of the letter. This letter of
offer is an important commitment by the contractor. A specimen letter is given in Appendix. Please read it
carefully and understand its significance, point by point. There are FIVE clauses in the letter.
(i) In the 1st clause, a reference is made to the tender notice or a letter of invitation as per the case. This
reference has a legal significance.
(ii) In second clause, the contractor commits that he has studied drawings, specifications, articles of
agreement and conditions of contract. All these shall be included in the tender document by the
architects office, so that the contractor can carefully read them, before giving the tender offer. Drawings
and specifications are prepared in the architects office for each work. Article of Agreement and
Conditions is a standard document used on every job. It is prepared by the Indian Institute of architects.
We shall study this document in the following chapter. My remark for you is that, it is a very important
and useful document, which you shall study carefully.
(iii) In this clause, the contractor commits that he knows the situation at the work site and he is ready to work
at the rates given by him, under the present site conditions.
(iv) These are the clauses, regarding E.M.D. It says that the deposit is without interest. It also gives period of
deposit and further states authority to the architect to forfeit E.M.D. under certain conditions.
2. General Conditions and Special Requirements of the Work:

These general conditions are usually standardized in every office, as they are applicable to almost all the
works. In addition, there could be some special requirement of a job. Such few conditions are added as special
requirements of that job. For example, municipal tap water is available on all the sites in a city. But if a
particular site has only well water supply or some other source, you shall write the conditions pertaining to
that and add to the general conditions.
3. Specifications of Work and Materials

This also, you should standardize in your office so that it can be added to the tender document. We have
discussed this in the previous chapter on specifications. In addition on a particular job, you may have an
unusual item of work, such as exposed brick finish, from the finish concrete or the application of a material in
an uncommon way or a new material in building. You should add the specification of such special items
carefully to the text of the tender.

4. Bill of Quantities
This is an important core paper of a tender. Your quantity surveyor should work out correct quantities of all
the items of work. I shall like to draw your attention here, that, to write an abstract of an item is an important
matter. If you forget a word or a clause in the abstract, which in fact is required to complete that particular
item, it becomes an extra claim or variation. The contractor can demand more money. So be careful! The
client has to more for your inefficiency, which is not creditable to you.
5. Drawings
Drawings shall be added to the tender to give sufficiently a clear idea about the proposed building. The
drawing shall explain the type and the extent of construction, i.e. overall dimensions and number of floors,
height of floors etc. It is not necessary to supply R.C.C. detail drawings at this stage if in the Bill of Quantities
item of reinforcement steel and concrete are separate. In the case of a structural steel work, the detailed
fabrication drawings are not required to be given at this stage, if item of fabrication work is to be quoted on
unit weight of structural steel. But details of items in the form of drawings should be given at this stage only
which cannot be fully visualized only with description, such as decorative grilles etc.
6. Articles of Agreement & general Conditions of Contract

A reference to this document is made in the Letter of Offer explained to you earlier in this chapter. A copy of
this shall be added in the blank Tender Form, particularly when it is a public tender. This is a printed document
available with the Indian Institute of Architects. We shall study more in detail about it in the following chapter.
Procedure of calling tender:

Tender document shall be prepared by the architects office. All the copies prepared shall be serially
numbered on the cover page. Copies of tender are sold to the contractors from the architects office. The
contractor goes through the tender papers and taking into consideration the specification and condition etc.
given in the tender, fills in the rates of every item of work against the abstracts in the bill of quantities.
Multiplying by the unit rates to the quantity cost of each item is arrived at. The sum, total of cost of all items
will give the amount of quotation of the tender.
There could be two or three schedules in a Tender. Such as civil work, plumping work, site development etc.
All these added together will give the final amount of tender offer. Filled in the tender is then put into an
envelope and the envelope is sealed. This sealed envelope along with the Earnest money deposit Amount in
the form of a Cheque or a demand Draft as per the instructions in the tender document is to be submitted on
or before the time and the date given in the tender. These conditions are usually given on the cover page of
the tender.
Earnest Money Deposit:

A contractor along with his tender quotation pays a certain amount as a deposit to show that the contractor is
earnest and sincere about this business with the owner. Further it means, that when called upon to complete
the business, he should not shirk or avoid. we define earnest money deposit as under.
A note on Earnest Money Deposit:

The amount of deposit asked along with the filled in tender or a rate quotation is called an earnest money
deposit. This amount shall be placed with the office of the architect, without any interest payable on it. The
deposit amount shall not be held for more than a month from the date of a receipt of the tender. The deposit
shall be refunded in full to the unsuccessful contractors; no sooner the decision is made on the tenders
received.
In case of successful contractor to whom the work is awarded, this earnest money deposit becomes a part of
security deposit and continues to be with the architects office till the virtual completion of the work.

On virtual completion of the work, the contractor shall apply to the architects office for the refund of the
amount. This amount is refunded in full by the architects office directly to the contractor and intimation in
writing is given to the owner.
In case of the contractor who is unable to commence the work when called upon to do so, this amount of
E.M.D. is forfeited and is credited to the owner as a part of compensation for the hardship the owner has
suffered.
How Much Time should be given to the Contractors to fill in the tenders?
Time and date for submission of filled in tenders shall be one and the same to all the contractors. A sufficient
time shall be allotted to the contractors to fill in the rates. The contractor has to visit the site to study the site
conditions under which he has to work. If the site is at a distance he has to make enquires for the availability
of material and labour nearby. He has to discuss the rates with his sub-contractors and other agencies before
he could arrive at the item rate.
Instruction on the Cover Page

On the cover page of the tender document, instructions shall be printed regarding 1) the time, date and
place where the filled in tender shall be submitted. 2)How much shall be the Earnest Money Deposit Amount
to be submitted along with the tender and in what form, that is by a cheque or a demand draft and payable to
whom the architect or the owner.
Receiving of Filled in Tenders

As a good practice, the filled in tenders should be received in the office of the architect. In case of the
institutional clients, as a matter of convenience, the filled in tenders may as well be received in the office of
the client. But in either case, the decision shall be made well in advance, and accordingly, the instructions
regarding the submission of tenders shall be printed in the tender notice and on the cover page of the tender
form.
Opening of Tenders
The time and the place of opening of the tenders shall be informed to the contractors while receiving the
tenders. The contractors or their representatives may as well remain present at the time of opening of the
tenders. The architect SHALL NOT OPEN the tenders in the absence of the owner.
Scrutiny of Tenders
A detailed scrutiny of all the tenders received is done by the architects office and a scrutiny report is
submitted to the owner recommending a contractor for the work. In case of public tender, we have
experienced as many as twenty-three tenders received for a project. It becomes a time taking task to
scrutinize so many tenders. You should be methodical in your work.
(i) Check whether the E.M.D. amount is submitted as per the conditions of tender. If NOT submitted, then
the tender offer should be rejected forth with. If the deposit amount is asked by cheque then the cheques
shall be deposited in the bank immediately. If the E.M.D. cheque is dishonored by the bank for any reason,
such a contractor shall NOT be considered for the work. Furthermore, such a contractor shall not be
considered for any work in future or should not be recommended to others. A specimen letter is given in
the Appendix. (13J).
(ii) Covering letter
a. Read carefully covering letter and other enclosures, if any. Often contractors in case of Public Tender are
tempted to enclose business profile of their contracting company, particularly when the contracting
company, particularly when the contracting company is stranger to owner/architect. It is worthwhile
contracting owners or architects to crosscheck the information given in such a profile.

b. The covering letter should have no conditions suggested in it, which will affect the work or the cost of
work. Usually, these conditions or rebates are linked with the supply of building material or water for
construction and supply of electricity for work by the owner on the site. Often contractors ask for advance
against building material brought on the site. As a good practice, conditions regarding all these points
should be mentioned very clearly by the architect himself in the text of the tender document.
(iii) The next step in scrutiny of tenders is to check the calculations in the schedule of rates. These days, all the
calculations are made by the calculators and therefore, there are hardly any mistakes in multiplication or
totals. Even then, it will be proper for the architects office to go through carefully through all the pages of
the schedule of rates, which is also referred as contract bill. If arithmetical mistakes are noted, these
should be corrected and the corrected total should be taken for the consideration for the choice of
contract.
After when the tenders are opened, in any case contractor shall not be allowed to enter the missing item-
rate. If selected for the work, the contractor shall carry out that particular item free of cost.
(iv) Rebate:
After arriving at the Total of Schedule of rates, sometimes a contractor offers a rebate at certain percent
of the total amount by writing a note to that effect. If the rebate is offered without any condition, it
should be considered and the total should be reduced accordingly. If there be any condition attached to
the rebate, then such a rebate is unacceptable.
(v) Comparative statement:

Having completed arithmetical check, correcting totals and applying rebate etc., a statement should be
written, name of contractor and the corrected total of tender offer against the name in an ascending
order of the tender offers, starting with the lowest offer in first place and the highest offer to the last
place.
Scrutiny report of tenders

After a careful scrutiny of the tenders received, the next job for an architect is to recommend a suitable
contractor to the owner for the work. This is called a Scrutiny Report. Please bear in mind her, your role, as
an architect is that of an advisor. You should be true to your conscious and recommend a contractor keeping
the interest of the project uppermost in your mind. You should be impractical and your advice should not be
influenced by any one from amongst the contractors or owners. Having given a sincere advice, the owner, May
he be an individual or an institution, may accept your advice totally or may think otherwise, you should not be
disturbed. This is what is said Disinterested Service to be given by an architect. Your role or duty is to get the
best possible work done from the contractor chosen and selected by the owner.
But remember, when an architect is knowledgeable and upright, a well-intentioned owner will always go by
the advice of an architect.
On writing a scrutiny report

The architect shall give a report in writing to the client, on the scrutiny of the tenders received for the project.
In his report, the architect should be logical in his statements. He should give step-by-step reasoning, for NOT
considering offers of contractors that are NOT suitable. If the architects office has worked out an estimate of
cost of construction of the project, using the same BILL OF Quantities, then the tender quotations nearby the
Estimate shall be given detailed consideration for selection.

The architects scrutiny report shall be submitted to the clients office in an enclosed envelope. The envelope
shall be opened by the Secretary or Chairman of the Committee only. The scrutiny report is a confidential
document. It is expected to be discussed only in a committee meeting. Members of the committee, in good
faith, are not supposed to make known the architects remarks about the contractors to anyone outside the
committee.
After receiving the owners instructions regarding the choice of a contractor for the work, the Architect has to
proceed further:-
1. During the process of selection of a contractor for the work, if certain points have come up, which need
clarification from the contractor who is to be selected or his definite willingness to accept work etc. is
required before he could be finally select for the work; a letter is written to the contractor by the
architect, which is called a LETTER OF INTENT. In this letter, the architect on behalf of the owner informs
the contractor the intention of the owner to give the work to him provided he is willing to do or accept in
writing the verbal assurances that he might have given during the process of selection. The contractor is
asked in the same letter to inform his acceptance by return post. On receiving an affirmative reply in
writing from the contractor, the architect issues a WORK ORDER on behalf of the owner to the contractor.
2. It is not always necessary to issue a letter of intent. If there are no additional and important points that
have come up during the process of selection of a contractor, it is also suitable to issue a WORK ORDER
and letter of intent may not be issued. Minor conditions also can be included in the work order itself. A
specimen of work order is given in the Appendix.
3. The contractor shall accept the work order and inform in writing his acceptance to the architect
immediately by reply post.
4. Only on receipt of the Letter of Acceptance from the selected contractor, you may say the tendering
process is complete. Only then the architects office shall refund E.M.D. of the rest of the contractors.
5. A letter to unsuccessful contractors:
a. This kind of a letter helps create fair impression about your office amongst contractors.
b. A person presenting your letter to contractor helps you identify the contractors man and your office can
handover the cheque of refund of E.M.D safely to him.
c. If you have mentioned a time slot in your letter to collect the refund, it is convenient to all and more
particularly to your office staff. Your office clerk should be ready with the cheque at the appointed time to
hand them over, and the contractors need not bother your office all the time.
6. The process of selection of contractor. i.e. up to issuing and acceptance of work order shall be complete
within one month from the date of submission of tenders.
Work order
A letter issued to a contractor selected for the work, asking him to take up the work, is called the work order.
1. On the instructions of the owner (Client), this letter is written by the architect, on behalf of the owner to
the contractor.
2. There has to be a reference in this letter to the tender or quotation submitted by the contractor for the
work.
3. The letter may contain a few additional conditions such as the date of commencement of a work on the
site or such conditions arising out of the discussions with the contractor during the process of selection of
a contractor.
4. The work order shall be included in the contract document and therefore conditions imposed in this letter
(Work Order) become a part of the contract.

Letter of Acceptance
On receipt of the work order, the contractor should send a Letter of Acceptance of the work order,
immediately to the architect.
With his, the procedure of calling tenders can be said to be complete. Now the architects office may refund
the E.M.D of remaining contractors forthwith.
A tender offer becomes ineffective

It is also important for an architect to remember that the tender offer becomes NO MORE BINDING over the
contractor under certain conditions.
1. Time period of the Tender Offer
This period is generally written as ONE MONTH from the date of submission of tenders. In some special case, it
could be more. This may depend upon the magnitude of the project or technical intricacy involved in it, and
also the reasonable time that may be required to study carefully the tender offer received. There has to be a
clear mention of this time period in the text of the tender. So that the contractor is aware of this time period
before filling in the tender.
If the client is unable to take the decision within this time period, then thereafter, the contractor is not bound
to accept the work order on the same tender offer. The contractor may come forward by his free will or may
refuse or may ask certain changes in rates or other conditions of the tender, which will have to be discussed
with him. Once the time limit is over, the owner/architect cannot with hold the E.M.D. and has to be refund in
full to the contractors.
Therefore, it is important for architecture to make a clear mention of this time period in the text of the tender,
and thereafter, observe this time period, and complete the process of scrutiny report earlier giving enough
time to the owner to make up his mind and to choose the contractor within the time period. If your client is an
institution, please remember, the decisions are not taken by an individual, but by a committee. Certain
procedure may be required to be followed, which it may require time. Therefore, the timetable should be
worked out properly before hand by the architect with the client so that the whole process of selection of
contractor is completed within the time period.
2. Counter offer by owner
The tender itself is an offer given by the contractor to carry out a work, which is worded by the owner through
his architect. During course of discussion if the owner puts forth another alternative method of contract for
the same work, it is called a counter offer. This counter offer by the owner sets the contractor free from legal
obligations of his earlier tender offer. The owner and the contractor may or may not agree on the counter
offer, but the fact that an alternative is suggested, the contractor is no more bound by the legal binding of his
earlier tender offer.
For example, a contractor filled in an item rate tender for a work. Later if the owner suggests carrying out the
same work on cost plus percentage basis. This is a counter offer. The contractor has a liberty to refuse the
counter officer, if he feels so. At the same time, he gets away from the legal binding of the earlier tender offer.
3. Death of a party
If the death occurs of either of the party before entering into a contract, than the tender offer is ineffective
and not binding on the contractor.
For example, an individual owner passes away suddenly during the tendering process. The contractors who
have filled in tenders are set free. But if death occurs of a Secretary or a Chairman or a Director of a company

who has invited the tenders, this does not hold good. The tender process can continue and the contractors are
not set free. Here, you have to understand and appreciate that the death of an individual office bearer, the
existence of a Society or a Trust or a Company is not affected.
4. Withdrawal of Tender
Withdrawal of tender process can be from the owner or from the contractor. The owner can stop tender
process any time before issue of Work order to Contractor. We have discussed earlier in this chapter Clients
decision to abandon the work. From the beginning you shall take enough care so that in case of withdrawal of
Tender process, no legal troubles shall start against your client and yourself as an architect. However, please
remember, this is not a desirable situation.
Withdrawal by Contractor: Contractor on reading the tender notice or a letter of invitation to tender has all his
freedom NOT to respond to the call. He can purchase a tender and may not submit it, if he is unwilling. This
means he can withdraw from tendering process without any obligations or legal hustle. But after submitting
filled in tender and the E.M.D., the contractor cannot withdraw from the process. If he does he loses his
E.M.D. and the owner may take him to the court of law for the compensation if he has not accepted the work
order.

QUESTIONS
Two marks:
1. Differentiate open and closed tender?
2. What is meant by calling for tender?
3. What are the contents of a tender notice?
4. What is Earnest money?
5. What is security deposit and how much is it?
6. What are the types of tender?
7. What is the significance of EMD?
8. What is Mobilization advance?
9. What are the guidelines for calling an open tender?
10. What do you understand by award?
11. Explain any two ways of inviting tenders.
12. What are the contents of a tender document.
13. Explain the advantages of open tenders?
14. What do you understand by the term EMD? Explain its importance.
15. What are the guidelines for calling closed tender?
16. What are the advantages of inviting limited tenders?
17. What is the purpose of insisting a tenderer to pay EMD along with his tender?
18. What are the contents of a tender notice?
19. Differentiate between open and closed tenders.
Sixteen marks:
1. The practice of selecting suppliers through tenders may result in the wrong supplier being selected
Evaluate the statement.
2. Explain the procedure of issuing and selecting suppliers through tenders.
3. Explain the various types of tenders available for building construction and analyze their merits and
demerits.
4. Explain how tenders are called for and a contract is settled.
5. Compare and contrast the different ways of inviting tenders stating where each type is best suited.
Establish the advantages and disadvantages of cost plus percentage tender. What is penalty clause?
6. What are the contents of a tender document? What is one part and Two part tendering?
7. Elaborate on the procedure to be followed at the time of opening a public tender. (8)
8. How do you scrutinize a tender document before recommendation. (6)
9. Differentiate between private tender and public tender. (8)
10. Under what situations, as an architect, you would recommend two part tendering. How would you go
about selecting the suitable contract through two part tender.
11. Explain in detail the process of tendering, from the issue of Tender Notice to that of signing a contract
agreement.
12. What are the new trends witnessed in construction industry with regards to the tendering process. The
traditional role of an architect undergoing a change. Do you agree or disagree?

UNIT II
CONTRACT
Therefore, there is an Act Indian Contract Act of 1872 to regulate the agreements or undertakings in
business.
Every time a contract need not be a written one. It could be an oral or often an implied one. For instance, you
stop an auto rickshaw, tell him the destination, and enter in it and the auto driver flags down the meter as a
mark of agreement. He starts the vehicle to reach you to your destination. This is an example of an implied
contract between the passenger and the auto driver from our everyday life. The passenger shall pay the fare
only when the auto driver reaches him to his destination and not otherwise.
Let us learn more about the contract in terms of law. In order to be good in Law. A contract must have the
following five elements present in it.
Sr. No Elements Pertaining building contract

1 An offer Tender offer by contractor
2 Acceptance Work order
3 Contract to be signed by competent person Rightful owner of land on which buildings is to
by free will and consent. be constructed and authorized person as
contractor, as other party to contract.
4 For lawful consideration Amount to be paid to contractor. Contractors
bill for the work done.
5 For Lawful Object Construction to be lawful, (approved by local
authority).
For making a good cup of coffee, not a black coffee, you must have water, sugar, coffee powder, milk and heat
to boil. These are the essential elements. If anyone cut of this is not available, then the mixture made cannot
be called a good coffee. Similar is the situation in Law of a contract. It will not hold good if any one of the
elements can be proved to be absent. Therefore, as an architect, you shall be careful to see that each of the
elements is legally sound.
1. An Offer
We have studied the process of calling tender. In the contract document, there shall be a positive reference to
the tender and tendering process. Therefore, the contractors letter of offer, which is included in the contract
document, we have seen that there is clear reference in the first paragraph to the Tender Notice a letter of
invitation for Tender. It is further recommended that a copy of TENDER notice or a copy of letter of invitation
for tendering shall be included in the binding of the Contract Document.
2. An Acceptance
Work order is an acceptance by the owner, to the tender offer given by the contractor. We have seen that, on
receiving written instructions from the owner, the architect issues a work order on behalf of the owner to the
contractor. To show that this element is observed in the process, a copy of work order shall be included in the
binding of the contract document.
3. Contract to be Signed by a Competent person

It is very important to remember that this contract for the construction of a building is between the owner of
land one part and the building contractor on the other part. The architect is NOT a party to contract. The

architect has to draft the contract properly. Therefore, the architect has not to sign the contract at all.
However, if any printing mistakes in the document are noticed, those shall be corrected on all the copies by
the architect only, before signing of contract by the parties. The architect shall put his signature at every
correction. Parties to the contract shall never alter or contract the text of the contract.
The two parties to the contract are the owner and the contractor. Let us see who is the competent person to
sign as an owner. Consider a private or an individual client who has to construct a bungalow for him. The
architect shall see from 7/12 extract or property card who is the owner of the land. At times, the plot is
purchased in the name of wife or son or some other close relative, for some other considerations. Sometimes
the wife is a bonafide member of a housing society and the leaseholder of the plot. In such a case man of the
house, head of the family, husband or father may come forth to sign the contract, saying that he is going to
spend money for construction or he is the KARTA of the family. It would be wrong to sign a contract by any
other person other than a person in whose name the land is held, or who is a bonafide member of a housing
society.
In case of a Trust, co-operative societies and such institutions, a Secretary or a Chairman shall sign the
contract. In case of Companies, an Executive Director or a person expressly authorized to execute the contract
shall sign. In all cases, there shall be a resolution passed in the Executive committee or Board of Directors
authorizing the person to execute the contract.
The other party to a contract is a contractor. Here again, the contractor could be a Proprietary Concern, a
Partnership company, or Private Ltd. Company. Since the Proprietary concern is owned and controlled by one
person, he shall sign the contract. In case of partnership, all the partners shall sign the contract. In the absence
of all other partners, one partner can sign provided there is a letter of authority in his name, signed by all
other partners. This letter shall be included in the contract document. Similarly, in case of a Private Ltd. Co., an
authorized signatory or an Executive Director can sign the contract.
Except in case of an individual or a private owner, both the parties to the contract, the owner as well as the
contractor needs to have a rubber stamp of the Post of Designation and name of the organization under their
signature.
By free will and Consent

Another important point you shall note is the parties to contract shall sign the contract with free will and
consent. Suppose, an agreement to sell a property is executed under the threat. It could be ineffective,
provided it could be proved in the court of law that the signature was made under threat.
4. Lawful Consideration
Consideration offered in the contract shall be lawful. Consideration means payment in cash or kind for the
work done. A mother says to a child if you do this for me I shall give you a chocolate. Here, chocolate is the
consideration for the work a child is supposed to do. In a building contract, the contractor agrees to construct
a building for which the owner agrees to pay him the contract amount. This is a usual form of agreement. But
suppose the owner proposes to hand over a piece of land or wealth in some other form as a payment or a
consideration to the contractor and that wealth itself is not legally owned by the owner or has some legal
hitch, then it is a unlawful consideration. In such a case, the contract itself is BAD AT LAW and does not hold
good.
5. Lawful Object
The object of a contract shall be lawful. Suppose, there is a contract to supply goods. But if those goods are
contraband goods. Then the object of a contract is not lawful. Therefore, the contract becomes null and avoid.
In case of the building contract, to construct a building is the object of the contract, and it shall be lawful. The
plans of the building shall be approved by the Authorities concerned. The land on which it is proposed to be
constructed shall be owned by the person who is a party to the contract. If knowing or by mistake, the owner
directs a contract to construction on a land not belonging to him, this becomes unlawful object, and the

contractor gets away from the legal binding of the contract. The contractor can as well file a civil suit for the
compensation from the owner.
Witness to Contract
While signing contract document, the signature of a witness is also necessary. Responsibility of a witness is
restricted to identify a person. That means a person signing a contract is genuinely the same person and NOT
an impostor. For that, it is expected that, the witness shall know the person who is signing the contract. The
witnesses also have to say whether the signatures were made by free will or under threat, in case asked in the
court of law. The witness is NOT responsible for the text or contents of the document.
Indian Stamp Act of 1899

Under the Act, a contract shall be executed on a stamp paper of appropriate value, as prescribed by the rules
under the Act, from time to time. Sale of stamp paper is a source of revenue to the Government. The stamp
duty is likely to be revised by the Government. Therefore, one has to refer prevailing Rule before purchasing
stamp papers. Value of stamp papers is related to the contract amount.
In case of dispute, unstamped contract papers cannot be admitted before an Arbitrator or a Court of Law.
Therefore, it is advisable to sign the contract on the stamp paper. Most of the building contracts in private
practice are carried out and completed smoothly without serious disputes. In very few cases, disputes are
referred to the Arbitrator and Civil Court. Taking the advantage of the probabilities, usually a contract is
executed on a stamp paper of lesser value. In case, if one has to a course of law, one will be required to affix
additional stamps of proper value along with the penalty.
Contract Document
A contract document is the most important document in connection with carrying out of the building
construction. It is necessary to have a contract in some form or the other. It could be only a verbal one or it
may consist simply of a Tender and a letter of acceptance. But better the form; the fewer are the difficulties in
carrying out the work.
The forms of contract in the Government Departments are different. If you are working in any Government
Department, you will have to adopt that form of contract, which is used in the Department.
The form of contract agreement we shall study is the one issued under the sanction of The Indian Institute of
Architects. It consists of- i) Articles of Agreement and ii) general conditions of contract
A contract document shall consist of the following papers:-

1. Copy of Public Notice or Copy of Letter of Invitation.
2. Copy of work order
3.1 Letter of offer by contractor
3.2 Articles of Agreement
3.3 General conditions of contract
3.4 Appendix
4. Specifications of work and material, reference to standard specifications, special or additional
conditions drawn up by the Architect for that particular job.
5. Bill of Quantities [contract Bill]
The same is referred as schedule of Rate as the item rates are written on it, which are approved and
accepted by the owner.
6. Contract Drawings
Drawings sufficient to indicate the work to be carried out. (This needs not be a Working Drawing in case of
item rate tender).

Before Signing of Contract

Contract document shall be properly understood by both the parties to contract before signing it. It is for the
architect to explain the contents of it, in short, to the owner. Both, the owner and the contractor agree to give
authority to the architect to properly administer the Building contract. Both of them agree and accept the
architects supervision on the work. Hereafter, the architect is owners representative on the work site, and
the contractor agrees to carry out the construction under the architects guidance and supervision, as per the
terms and conditions of the contract. Hereafter, the owner shall express his views about construction, not
directly to the contractor but through the architect. The contractor shall not try to by-pass the architect and to
take the instructions regarding building construction or ask for the payment directly from the owner. The
owner shall not entertain any request for payment from the owner. The owner shall not entertain any request
for payment from the contractor if it is not certified by the architect. Both of them by virtue of this contract
appoint the architect as an authority to administer the building contract. If this discipline is observed by all, I
am sure the building construction shall be a happy experience.
The architect is now charged with a heavy responsibility. He should always remember that the owner is
building by spending his own money. Therefore, he should respect his aspirations and expectation about the
building. Ii is his duty to give the owner is sincere advice to the best of his abilities and to safeguard the
interest of the owner. Finally remember it is owners wish; it is owners property.
Appendix in general conditions of contract

Before signing the contract, the appendix shall be filled in by the architect, with consent of both the parties
and in their presence. The architect should explain to both the parties, the relevant clause and the decision
should be taken mutually.
Owners consulting engineers

I have experienced many a times, particularly in the case of an Educational Trust, interference from the
owners side in administering a contract. Often there is an honorary consulting engineer appointed on the
building committee. Usually, such a person is a retired Government Engineer either from Railways or P.W.D.
Having spent entire career in the Government department, most of them have no information about the
private architectural practice. They do not care to read and understand the contract document, which is
different in the text from the one used in the Government works. Such consulting engineers feel that they are
supreme and hence, the conflict arises. It would be in the interest of the work, if such a consulting Engineer
remembers that an architect is the owners representative on the work site and not a contractors man. He
should speak with the architect about the building work to suggest him or to draw his attention to and not
contradict the architect or try to overpower him. The architect should also keep an open mind to the
suggestions from consulting engineer. Sometimes, the engineer may have practical experience of work site.
Most of the time, the engineer would be senior to you in age. You should always be polite in conversation, but
need not be submissive on every point. It is always good to learn from a knowledgeable person. That should
be your attitude all the time in your life. At the same time, remember you are the architect, responsible to the
building committee and shall not be carried away by an individuals opinion.
Now about the works of individual clients. I feel it is the sign of a good culture of an individual or a good setup
of mind that, having appointed an architect one should go by his advice. If you trust someone more than your
medical consultant, it may not be suitable for your health. Unfortunately, very few individual clients have such
well-cultivated mind. I always preach an individual owner, a private client that,there is no one else except
both of us who are really concerned about your project. There may be several suggestions from many people
around you. Please feel free to discuss with me the suggestions. We shall adopt if found suitable. But please
do not be carried away or be disturbed by the comments of passers- by. Because he is not responsible for his
comments or suggestions.
I remember, a father-in-law of my client, for whom I had designed a bungalow, was a retired lecturer from an
engineering college. He used to suggest and even insist the contractor in my absence to do something else on
the site. It was a big problem for me to protect my design from such a quack. On the other hand, a surgeon

told his wife and other family members, for whom I was doing his Bungalow; we have had enough discussions
with our architect he said now do not listen to the comments of others that may create confusion. When
you visit the construction and if you have anything to say, say it to the architect and not directly to the
contractor. It was a pleasant experience to all, including the contractor, to construct that Bungalow.
DIFFERENT TYPES OF CONTRACT
Now we shall study the different types of Tenders. The terminology is applicable to the types of contract as
well.
1. Item Rate Tender / Contract

This is a type most commonly used for big as well as small building projects. After finalizing the working
drawings, quantities is prepared mentioning quantities of each item against an abstract of an item. This
schedule of quantities is then issued to the contractors for filling in item rates. Thus on the basis of the same
and on the equal information, the Item Rate Tenders are invited from the contractor.
A) This is a standard and suitable method for a big as well as for a small building project.
B) Rate of an item is the commitment in this form of Tender/Contract.
C) This gives a freedom to the owner and his architect to change the details of work during the construction,
as he has a liberty to increase or decrease the quantities of any item of work. without vitiating the
contract
The only disadvantages in this form of contract are the uncertainty of the final amount of the cost of
construction. Usually, it is observed that there is a difference in the contract amount, i.e. estimate and the
final bill of the contractor. If the final bill is much more than the contract amount, i.e. estimate, then it may
sometimes, pose difficulty for the owner to arrange for the additional funds. This creates displeasures
between the owner and the architect. To keep this possibility to the minimum, you as an architect should take
at most precaution. i) You should work out quantities and estimate preferably from working drawings, as
accurate as possible. ii) During the course of construction if there is a change in the work, which would
increase the cost of work, it should be notified in writing to the owner from time to time.
2. Lump Sum Tender and Contract

This method is more suitable where the owner requires a fixed commitment of investment for construction of
a project. To overcome the problem of cost overrun, which we find in an item rate contract, this method of
contract shall be useful. This is suitable for the construction of buildings of a simple nature and with no
possibilities of additions or alterations during the course of construction. One may find it suitable for a
repetitive work.
Essential Points to be Observed White Calling a Lump Sum Tender

1. Work to be carried out should be very clearly shown by means of drawings
Plans, elevations, sections and all relevant details, including a schedule of reinforcement in case of R.C.C.
structure and fabrication drawings in case of a structural steel work, in short, a complete set of working
drawings should be supplied to a contractor to work out the cost of construction. Minor details of railing,
grilles, etc. should also be included in the set of drawings, if they are required to be included in the
construction cost.
2. Specifications
Materials and work specifications shall be included in the tender. A list of finishes such as floor finish, plaster
finish, dado, colors, paints etc. everything shall be clearly indicated on drawing and supplemented in words. So
that the contractor will be able to work out correct quantities. It is convenient to give a list of approved
materials.

3. Plumping and Sanitary fittings

If the services are also to be included in the lump sum tender, than a plan together with the specifications
shall describe the plumping and the sanitary work. One should specifically mention the size, colour and make
of the sanitary fittings, the diameter of a material and the make etc. of waste lines and sewage line,
underground lines. It is proper to give a plan of drainage line including inspection champers and up to the
disconnecting chamber (Intercepting chamber) and to include this work in the lump sum tender.
Where municipal sewage lines are not available to a site, a septic tank shall be constructed, and it shall be
included in the lump sum tender. However the architect should not forget to give a working drawing of septic
tank, if it is not ready-made to be used.
4. Electrical Installation
If the lump sum cost is to include an electrical installation, you should indicate, the outlet position, the control
switch board positions, the positions of D.B.M.C.B., the electrical meter position, etc. clearly on the drawing.
The specifications should give details of wire, switches and accessories, control panel etc. You should also
specify whether it shall be a concealed wiring or a surface wiring. It is convenient to include in the lump sum
tender, an electrical installation up to and including the main switch electrical meter and cupboard. Bringing
an electrical supply up to the electrical meter shall be separate job, which may not be included in the lump
sum tender.
5. Water supply
Water supply system within a building can also be included in the lump sum tender as it can be clearly
indicated on the drawing and can be described in the specifications. This shall include an overhead water
storage tank, a ground tank or an underground tank. In case of a ready-made tank, it is necessary to specify its
make, capacity etc. while it is necessary to supply a working drawing, in case of the tank is to be constructed
on site. The drawings and the specifications shall include a diameter and a class of G.I. pipe line to be used in
the work. The water supply may require a water pump, which has to be specified properly.
Source of water supply to a property could be a municipal water supply or owners own arrangement such as
well water or water lifted from nearby lake etc.
Uncertain items of work

The uncertain items mean the items, which cannot be worked out in details in terms of quantities and cost at
the time of floating a lump sum tender. It will not be fair to include such items in the tender. It could be a
reason for dispute and displeasure. To cover an uncertainty, a contractor may consider a higher cost for a
work. Then it is a loss to the owner. On the other hand, if it goes beyond the expectation of a contractor in
expenditure, it may have a bad effect on his performance.
Work below ground level

To be strictly theoretical, the list of uncertain items of work will include the foundations of a building or work
below the ground level. The depth of excavation cannot be predicted. A trial pit cannot be always
representative of all the area of a building. The depth of excavation totally depends upon meeting desired
strata. Therefore, the depth of excavation varies from column pit to pit. If the variation in depth is not much
and yet well within the specified depth, then such a case may be suitable for the lump sum tender. Sites with
slope or with changing strata are really not suitable for including foundation work in the lump sum quotation.
There may be a big difference between assumptions and actual. It may prove unfair to either of the parties to
contract.

CONTRACT DOCUMENT
Supervision of work
Supervision of work is an important duty of an architect from the practical point of view. You shall be good at
designing of a building. It is equally important for you to give an effective supervision on the construction. It is
not expected of you to be on site all the while. Even then you shall have full control on the project. For that
you must be well versed in your responsibilities and authorities as well. In government department, executive
powers are not with the government architect. There are engineers of the department for that purpose. But in
private practice, it is not so; and it shall NOT be so. Owner engages an architect for a project; and the architect
shall not lose hold on the project.
As per code of council

The council of architecture has kept this role of Construction Manager as optional. On big projects, owner is
supposed to appoint a separate agency to supervise the construction work. But there is more number of
medium and small construction works where perhaps it is not suitable to the owner to engage one more
agency to supervise the construction. If a clerk of works/ site supervisor is appointed to assist the architect,
reasonably effective supervision on construction is achieved. Articles of agreement and general conditions of
contract as prescribed by the I.I.A. shall be used for signing contract, which gives an architect an additional
authority that is required to work as a Construction Manager.
Architect as construction manager

A practicing architect is in a way a Construction Manager of a project for which he has been commissioned
by the owner to design. He being the owners representative has to see that building project is executed under
his supervision and guidance per the conditions of contract signed between the owner and the contractor. He
has to oversee quality of materials and the workmanship with the help of the clerk of works (in some cases
mare than one person) appointed for the project. He shall see that the project is carried out as per the design
drawings, working drawings and specifications given to the contractor. The architect may be required to give
further details and decisions during the course of construction. He has an authority to remove any worker or
sub-contractor for his unsatisfactory performance, so that the quality of work shall not suffer.
The architect has to control the cost of the project by checking the quantities of works executed and the item
rates shown in the contractors bill for payment. The architect has to probe into the extra item rates and rates
for variation of items and judicially certify them for the payment. He has to play a role of an Auditor for that
matter. Over and above, an architect must keep a proper liaison with the client. Keeping him informed
regularly the progress of work on site and directions and decisions given to the contractor by him (Architect).
To discharge all this duties, an architect has to visit the site frequently at a regular interval. He has to make a
round and see for himself all the areas of the project. He shall hold site meetings with representatives of
general contractor, sub-contractors, nominated sub-contractors, site engineers and clerk of works etc. In such
a meeting, he shall criticize under performance and delay in progress, unsatisfactory quality etc. But shall not
remain behind to praise a person for his good work. This motivates the team to do better than before. He
shall always talk of co0operation and co-ordination between different agencies and sub-contractors and
suppliers. He shall motivate the whole team for doing their best.
When the contractor is doing his work sincerely and satisfactorily, the architect shall also go little out of the
way it insists upon the owner for making the payments to the contractor on time. Because that keeps the
contractors money rolling.
Study of contract document

Out of the three types of contractors an item rate contract is more commonly used. We have made a list of
components, generally included on a contract document in Chapter XI. If it is a lump sum contract, there
shall be a slight change in the list of components. That also we have discussed in Chapter XI. Common to both
the types is the letter of offer given by a contractor to the architect. (Please read a specimen given in
Appendix 14.I). There are five paragraphs in the letter. Each of them is an important commitment.

Letter of offer
In the 1st paragraph, there is a reference to the procedure adopted for this tender, i.e. invited or Tender
notice in newspaper dated etc. There is also a reference to the work, i.e. name of the work for
which this procedure of tender is made. The next item is about the type of tender Schedule of Rates if it is
an item rate Tender or Lump sum amount of Rs if it is a lump sum tender.
In the following paragraphs, the commitments made by the contractor are of immense importance for the
execution of project. Here, he accepts your authorities as an architect for the project. He shall not raise claims
on account of conditions on site. He shall accept your authority to forfeit E.M.D. under certain conditions. The
contractor also commits the time limit to complete the said work.
This offer letter shall be signed by the proprietor, if the contracting company is proprietary, and by all the
partners if it is Partnership Company, names of all the partners shall be written by the contractor. A rubber
stamp of the office shall be used. All these precautions shall be taken to restrict the possibilities of anyone
backing out from the offer given. The other partners shall not deny their legal responsibility.
In addition to the general Conditions of contract as prescribed by I.I.A. and which are available in printed form,
every architect may have a few additional clauses for a particular work, which are called PRELIMINARY
CONDITIONS. These shall be included in tender and in contract as well. While writing out these Preliminary
Conditions, one should avoid repetition of clauses that are included in General Conditions, which are
exhaustive in it.
To write out and to include the specifications of building materials and works shall be a volume of work. There
are standard specifications of building materials and works by I.S.I. specifications by public works department
of the Central Government and the State Governments. You shall be familiar with at least one of them.
Preferably you shall have a copy in your office library. In preliminary conditions if you include a clause saying
Where not stated otherwise, standard building material and works specifications as laid down by P.W.D.
Handbook shall be considered for this work. This will reduce your clerical work and stationery. For the benefit
of young architects, starting their own practice, I have added in Appendix Preliminary conditions used in my
office. You should read them carefully and understand well. You shall copy them and suitably include in tender
and contract in your work. I shall draw your attention to some of the clauses.
Basic Rates of Material and Escalation of Prices (refe3r Appendix 14 II)

At the time of floating tenders, the architect shall learn from the market, the prevailing rates of building
Materials and include them in the list of Basic Rates. The advantages of this clause are;-
A. This provides a freedom of choice to the Owner and the Architect regarding the finishing materials such as
marble, ceramic tiles, mosaic tiles etc. without being unfair to either of the parties to contract.
B. The owner can arrange to purchases the standard building materials such as Cement, Steel, and Bricks etc.
provided he could procure it at a cheaper rate than the basic rates and supply it to the contractor. / The
deduction for the material supplied shall be made from the contractors bill at the Basic Rates only. The
difference in price shall be saving to the owner. Educational Trusts, Hospitals or even an Individual Owner
may get a big discount or donation in the form of Building Material. This clause is useful in such situations
[Refer clause owners right to supply building material].
C. Price Escalation; during the period of construction, prices of material are likely to fluctuate. If the price rise
is marginal usually a contractor can absorb it. But if it is more, say more than 5 %, and then it would be
unfair to compel the contractor to work at the same item rate. If the price rise is very high, it may erode
the profit margin of the contractor and may have an ill effect on the quality of work. Cost of building
material is a major component in an item rate of work.

Therefore, if the escalation in building material is taken care of, the contractor faces no hardship due to price
of material. This arrangement I have found in my practice, works well. If not all, prices of major building
materials such as cement, reinforcement steel, structural steel, bricks, floor tiles etc. shall be covered under
this clause.
The contractor has to produce bills of the material purchases to architects office. The architect shall check
whether there is a clear mention on the bill, of the site to which the material is delivered. The date of the bill
shall also match to the requirement of material on the site. The clerk of works shall certify the arrival of
material on the site.
This is only to ensure that the Purchase Bill of other sites is not put in to the account of your site.
Purchase Price - {Basic price + 5 % of Basic price} = Amount payable to contractor by owner.
[Basic price + 5 %of basic price] Purchase Price = Amount payable to Owner by contractor.
In Government works, there is a certain formula to work out increase in an item rate and labour rate due to
inflation, which is rather clumsy. I do not recommend it to be used in private practice.
The printed booklet consists of:

1. Articles of Agreement
2. General conditions of contract and
3. Appendix
Articles of Agreement
The first page of the booklet of the printed matter or ledger paper is the Articles of Agreement. This is printed
in the form of Fill in the gaps. It is necessary to affix adhesive court fees stamps of appropriate value before
signing on it. Legally it is very important. One shall not sign first and then affix stamps. Person signing the
contract must realize and understand that he is signing on a stamp paper. Alternatively, the text of Articles of
Agreement shall be typed on a stamp paper of the appropriate value. This stamp paper shall replace the
printed first page of the booklet. Purchase of stamp paper of affixing stamps is to be done by one of the
parties to the contract, usually the contractor. The contractor shall purchase a stamp paper and give it to the
architects office for further work.
Filling in the gaps in the text of the Articles of Agreement is very simple. Still you must remember the
following;-
1. The first line is the date This is the date of signing the contract and not the date of tender or any other
date. In practice, the contractor can start the preparation on site or commence the work on site on the
strength of the work order received by him. Preferably the contract shall be signed before commencing
the work on site. With mutual good faith, it could be signed a few days later as well.
2. Then comes the Name of the owner and his address (herein after called the owner). Thus, we define the
owner, the party to the contract. In case of institution, name of the person, his designation and address of
the office of institution shall be written.
3. The other party to the contract The contractor is defined in the following lines. In case of a proprietary
concern, you shall write e.g. U.R. Nandi, proprietor of Nandi constructions. If it is a partnership company,
it is good to make all partners party to the contract, e.g. U.R. Nandi, partner and all partners of M/S.
Nandi construction co. Thus in case of a company, name of the person his position, like partner, director
etc. and address of the company shall appear.
4. Then follows the work WHEREAS the owner is desirous of .. Here you describe the work.
e.g. the owner is desirous of constructing a Building for a Hospital on .. Then the address of
site.
5. Next to be filled in is the name of the architect and his office address.

6. Please note in case of a lump sum contract, you should omit the word Bill of Quantities and keep only
working drawings and specifications in the text.
7. The contract drawings (refer definition on page No.232) shall be numbered, and shall be signed by both
the parties to contract. The schedule of rates included in contract called contract Bill, shall be signed by
both the parties on the last page of the Bills.
8. Security Deposit: E.M.D. given along with the tender, along with additional installment if asked for, is now
termed as Security Deposit. This security Deposit shall remain with the Architects office and shall bear no
interest. It shall be refunded to the contractor on virtual completion of the work. This amount of deposit is
to be mentioned here in the Articles of Agreement.
The Para says it is agreed as follows. This sets out the obligation of each of the parties. The contractor has to
complete the work as per the terms of contract and the owner has to pay the contractor the contract sum or
the sum as becomes payable as per terms of contract from time to time. The Articles further define the
Architect for this contract and appointing his successor in case, it is need to do so. The intention is not to
allow the contract to become void on account of change of Architect. There is a point to be noted in this
paragraph. Appointment of an Architect for this work is entirely the owners choice. The contractor has given
tender and entered into contract knowing full well who the Architect, for the project is. If he had any
grievances regarding the Architect, the contractor in the first place should keep himself away from tendering
for the work. But now having entered into contractor if for some reason, the Architect is required to be
changed; it cannot be the owners choice alone. The contractor has a reasonable say in it.
Architects office shall make the contract document on stamp paper and shall prepare two copies of it, at the
same time.
A. Before signing the contract the architect shall allow both the parties to contract particularly the
contractors to satisfy themselves that the item rates in the contract Bill, in all the three copies are the
same as agreed upon in tender offer.
B. Then the architect shall explain the Appendix to both the parties and fill in the particulars.
C. Both the parties shall sign below the Appendix on all the three copies.
On Filling Appendix
At the end of the general conditions of contract is the Appendix. This shall be filled in on all the three copies by
the architect, after mutual consent of both the parties to contract.
Defects Liability Period

This is like a warranty period given by a manufacture. Any defect observed during this period in the building
shall be made good by the contractor free of cost to the owner. Defect liability period shall be minimum one
year, after virtual completion of the building, so that the building has experienced all the seasons of the year.
However, if the owner desires to extend this period it shall be notified in the blank tender document.
Period of Final Measurement and Valuation

This is printed as three months after virtual completion and that is reasonable. After the contractor has
submitted his final bill and measurements, the architects office shall scrutinize and finalize all the accounts of
the project within three months.
Date of Commencement
In the work order, the contractor is given a certain period to mobilize the site and he is asked to commence
the work on site on or before a certain date. The date on which the work is started on site shall be entered
here.

Date of Completion
The contractor has committed himself to complete the work in certain period of time in the letter of offer. The
date of completion shall be worked out accordingly and shall be entered here.
Agreed Liquidated Damages

There is a penalty for the delay in completion of the work. The owner having invested in building, if he is not
able to utilize the building on account of non-completion of work on time, he is losing his returns on his total
investments. To work out the per day loss to the owner, work out interest at 70% p.a. on the contract
amount for one year and divide the annual interest by 365 to work out daily loss.
Loss per day - Annual interest on the contract amount at 70 % 365 days
This amount shall be rounded off to a suitable higher figure and shall be written in Appendix. The per day
amount shall not be too small; lest it will NOT serve the purpose. Often the owner is nor=t happy with a small
per day penalty, particularly in case of industrial or commercial projects. Then these calculations shall be
made with higher rate of interest mutually agreed, say 18 % or more. But remember, to make it a balanced
contract, you shall insist to apply the same rate of interest for the delayed payment by the owner to the
contractor. In that case, the architect shall correct the rate of interest printed on all the copies of the contract,
with a mutual consent of both the parties. The architect shall put small signature there.
Value of Work for Interim Certificate

It is not practical to expect a contractor to complete the project and then ask for payment at the end. The
contractor shall be paid in between also. The contractor shall raise the Interim Bill or the Running Account Bill
(R.A. Bill) of the work done on site from time to time. Instead of raising a monthly bill, it is more correct to set
up a mutually agreed amount for the interim bill/certificate. This amount mutually agreed shall be written
here. As and when the contractor realizes that he has carried out work worth that amount, he shall submit a
bill along with measurements sheets and all relevant papers to the architects office for the scrutiny and for
issuing the certificate for the payment.
This amount of bill can contain value of building materials brought on site such as cement, reinforcement
steel, bricks etc. if purchase by the contractor.
Usually 80% of the cost of unfixed material on site is included in the amount payable to the contractor in the
running account bill. This value of work for interim certificate shall not be too small. Though the contractor will
like to have it small. So that the contractor can keep his investment lie in the project, there will be more
number of interim bills in a given project, occupying more of your time in scrutinizing them.
The owner shall not pay the contractor under any pretext, without a certificate for payment from the
architect. The owner shall not pay to the contractor any amount more than that is certified by the architect,
for the payment to the contractor.
In Case of Lump Sum Contract

Write here in Appendix as per statement attached. A statement shall be made stating stage of work done on
site and amount to be paid to the contractor at that stage.
Retention Percentage
Before commencing work on the site, a contractor is supposed to deposit 10% of the contract amount as a
security deposit with the Owner/Architect. When the project is of a big amount, the amount of security
deposit also is sizeable. The contractors working capital is locked up by giving this security deposit.
Schedule of Quantities
In an item rate contract, the rate of an item is the essence to any extent, which will not vitiate (destroy) the
contract. This is not provided here to give you (Architect) a liberty to be careless about quantity surveying
whiles preparing the tender and the contract bill. This is to give Liberty to the Owner/ Architect to do

alterations in design during the construction to some extent, which wills obviously increase or decrease
quantities of items.
The owner has a right (a) to increase or to decrease any of the quantities of item, (b) to totally omit any item
of work. The contractor shall not claim extras or damage on these grounds.
Contract Drawing
The drawing that is including in a contract document is a Contract Drawing. It is to be taken as indicative. It
shows dimensions, positions and type of constructions.
1.1 Contractors work shall not deviate from the drawing and specifications. Architects interpretation of these
documents shall be final and without an appeal. This is a very important clause. Architect must know
precisely what he wants as far as design is concerned and he shall be confident about the technology. So
that others may not over power him.
1.2 A) Errors or consistencies in drawing and specification shall be promptly brought to the attention of the
architect, for the interpretation or correction.
B) Local conditions, which may affect the work, shall be also brought to the notice of the architect.
C) If it is discovered at any time that the work is not as per the drawings and specifications, the contractor
shall correct at his own cost without claiming extra time or cost.
1.3 Large scale drawings shall take precedence over small scale drawings figured dimensions shall govern. Any
work done before the receipt of such details, shall be removed or corrected by the contractor or adjusted
as directed without extra cost to the owner.
[As a good practice, the architect shall give all the large-scale details well in advance. You shall not take
this clause as a license to delay your work.]
1.4 All drawings, bill of quantities and specifications and copies thereof, shall not be used on any other work
but shall be returned to the architect on the completion of work or the termination of contract.
1.5 Bar bending schedule if asked for, shall be supplied by the contractor to the architect at least fifteen days
in advance before the fabrication of the reinforcement. [This is to give you a sufficient time in your busy
schedule, to examine the schedule carefully. Once you or the structural engineer has approved the
schedule, it is your responsibility about its correctness.
Contract Sum
The contract sum shall not be adjusted or altered. The contract sum can be altered only in accordance with
the express provisions of these conditions of contract. The architects interpretation of these documents
(Which includes drawings and specifications as well) shall be final.
Contract Bills
The bill of quantities included in a contract known as contract Bills.
1. If there is no other mention in case of a particular item of work, then the quantities shall be worked out
(measured) as per the standard method of measurement of building works latest issued by the Indian
Standard Institute (I.S.I).
2. If the architect indicates as a particular mode of measurement for any item of work in this bill of
quantities, the same shall be followed by the contractor. (irrespective of standard mode of measurement)
3. Any error in the description or in the quantities or the omission of item from the contract bills shall not
vitiate this contract. The errors shall be corrected and items omitted shall be added and these items shall
be considered as variations required by the architect.
Scope and Intent of contract

1. The general character and the scope of work is illustrated and defined by i) Specifications, ii) Bill of
quantities and iii) Contract Drawings. All these are included in the contract document.
2. If any discrepancy in or a divergence between the three above is observed by the contractor, he shall give
a written notice to the architect pointing out a discrepancy or a divergence. The architect shall issue the

instructions in regards to that Extent 8(2) under this clause, the architect is authorized to issue to the
contractor further drawings, details and written instructions regarding the said construction work.
3. The intent of a contract document is to include all the required labour, material, equipment and transport
etc. necessary for the proper execution of work.
Architects Instruction
1.1 Under the contract, the architect is expressly empowered to issue instructions to the contractor pertaining
the said work.
i) The contractor shall comply with the instructions of the architect.
ii) If such instructions involve variation, it shall be confirmed writing.
iii) If the instructions issued by the architect are not complied with the contractor within seven days, then the
owner may employ and pay other person to execute any such work, which may be necessary to give an
effect to such instructions. All the cost incurred for such work shall be deducted by the owner from
any payment that shall be due to the contractor.
1.2 The contractor may ask the architect in writing, the clause of a contract under which a particular
instruction has been issued by the architect. The architect shall reply forthwith such a letter. Obviously,
you must be conversant with the General Conditions of Contract. (Purports to be.. = appears to be
..)
1.3 All instructions issued by the architect shall be in writing. any instruction issued orally shall be of
immediate effect. But the contractor shall confirm in writing to the architect within seven days.
Facilities and Co-operations

The construction of modern buildings is a multidispensary work. The general contractor who is a civil
contractor has to co-operate with other contractors such as contractor for elevators, air-conditioning,
electrical installation, plumping etc. This clause is necessary to make it obligatory for the general contractor to
co-operate with other agencies contractors.
Setting Out
This clause puts responsibility of accuracy of setting out of line out of building on to the contractor, as per the
drawing provided by the architect. The architect has to furnish the contractor an accurately dimensioned
drawings and information such as line of reference and correct levels etc. Therefore, you shall be capable to
produce an accurate centre line plan.
Contractors Visit to Site

1. The contractor is supposed to study the conditions at the site including access to the site, distance,
availability of men and material to the site etc. before filling in the item rates in the tender. This clause is
to prevent the contractor from making a claim for an extra payment later on account of situation at the
site.
2. Possession: The site is as if given in possession of the contractor to do the construction work as per the
contract from the date of commencement and up to the date of completion subject to extension of time
given as per the relevant clause.
3. Treasures: Any treasures coins or object of Antiquity found on the site shall be handed over to the owner.
Often such things are found in excavation.
Samples and Shop Drawings

Under this clause the contractor is required to submit the samples of all materials within sixty days of signing
the contract and not less than 120 days before its use in that particular item of work taking place on site. The
architect shall remember this clause and insist up on it. That will set the contractor to make the arrangements
well in advance and there will be enough time to place the orders for supply of chosen and specified material.
The clause further says that the dates of submitting samples shall be indicated on Bar chart. This is very
important. That reminds every one, the architect as well as the contractor, the activity that should take place
on a particular date to be on time.

Progress Chart
Project management is much talked about these days. In fact it is nothing but methodic working of a project. If
it becomes a habit with you to work systematically in your everyday work, you are not far from Project
Management. Only ting remains to learn about and adopt in your work, a couple of tools like BAR CHART
(progress chart), flow chart and Network Diagram etc.
This clause authorizes you to insist upon the contractor to produce a progress chart (bar chart). You shall make
copies of the same and keep one in your office and the other on the site. You shall refer the chart every time
when on site visit to check the progress of work on site.
Access for Architect to the Work

The opening sentence of this clause says Architect shall be the owners representative during the construction
period. This is one of the roles; the architect has to play in practice. The other roles being, owners advisor,
auditor and umpire. This clause gives an authority to the architect to visit not only the work site but also
places of work of sub-contractors for the inspection of work being carried out there.
Architects Status and Decisions

There are about twelve points in this clause.
1. The Architect shall be the owners representative during the construction period.
2. The Architect shall periodically visit the site to see for himself the progress and the quality of work and to
determine in general if the work is proceeding as per the contract conditions.
3. The architect shall not be required to make exhaustive or continuous on site inspection to check the
quality or quantity of the work and he shall not be responsible for the contracts failure to carry out the
construction work as per the contract.
Often the owners have wrong expectations of architectural duties. This clause is important from that
point. It is for us to explain to the owner beforehand. As far as construction is concerned, the
responsibility of an architect is to give proper drawings and instructions to a contractor. In spite of that if
the contractor is unable to deliver the goods, it is logical to say that the architect shall not be responsible
for the contractors failure.
4. The architect shall inform the owner from time to time about the progress of work on the basis of his visit
to the site [while explaining clause 9.3 above I have suggested writing on Triplicate Book. In that develop
habit of writing an opening line about the progress of work on site such as Concreting of footing is
complete or Brick Masonry on ground floor is almost complete. This is recording the progress of work. A
copy of these instruction to contractor shall be sent to the owner. There by the obligation of keeping the
owner informed about- i) progress of work and. ii) your instruction to contractor is fulfilled.
5. The Architect shall guard the owner against defects and deficiencies in the work of the contractor, and for
that he shall condemn the work, which is not as per the architects instructions, in the form of drawings
and specifications. [In such a case, the architect shall give a written instruction to remove and redo the
portion of work, which is not meeting the requirements of the contract conditions].
6. The Architect shall have an authority to act on behalf of the owner only to the extent expressly provided in
the contract document. [The contract gives an authority to the architect to act on behalf of the owner only
for the proper execution of the project and not beyond. It will be beyond. It will be beyond the architects
authority to promise someone to sale a portion of property or surplus land of the owner etc.]
7. The architect shall have an authority to stop the construction work whenever such stoppage is necessary
to ensure the proper execution of the contract.
8. The architect shall be in the first instance, the interpreter of the conditions of this contract and the judge
of its performance. He shall side neither with the owner nor the contractor. He shall use his powers under
the contract to enforce its faithful performance by both the parties.
9. In case of termination of the architect, this contract shall not be vitiated. The owner shall appoint another
architect against whom the contractor shall have no unreasonable objection. Any dispute in connection
with such appointment shall be subject to Arbitration. [please refer the explanation on ARTICLES OF
AGREEMENT].

10. DECISIONS: The architect shall within a reasonable time make the decisions on all the claims of the owner
or the contractor and all other matters relating to the execution and progress of the work or
interpretation of the contract Document. The Architect is an umpire. Therefore, do not be hasty in
expressing your opinion. A layperson can make any statements. But when a professional expresses his
views, it is taken as considered opinion. Therefore, you shall express your opinion within a reasonable
time and not on the spur of the moment. You shall express your views only after referring the matter, text
of the contract, drawings, standard specifications etc. as needed by the case. But at the same time, you
shall not take too long give your decisions.
11. This clause also authorizes the architect to issue from time to time further drawings, details and written
instructions all the matters related to the construction of the project. A full list from A to L is given in the
clause.
12. DISMISSAL: If in the opinion of the architect, any person employed on the work by the contractor or sub-
contractor, is not competent or has misbehaved, the architect shall ask the contract to dismiss him from
the work. The contractor shall do so with an immediate effect. A person so dismissed shall not be
employed again without a written permission of the Architect.
[The Architect shall use this authority if he notices bad workmanship-either due to lack of skill required for
the job or the attitude of a worker to ignore the instructions given by the architect or the clerk of works. It
is necessary to exercise this authority in the interest of the work, which results into safeguarding interest
of the owner, which is the prime duty of the Architect.]
Performance Bonds
The concept of security deposit is explained earlier in this chapter in the paragraph Retention percentage.
Earnest money becomes a part of Security Deposit. Amounts shall be agreed upon mutually. The period of
holding the deposit is also subject to mutual agreement before signing the contract.
Clerk of works
The word CLERK may be misleading for some of you. The clerk of work is in fact a Technical Person and is
Supervisor of work on site. Architect shall insist on the appointment of Clerk of Works particularly on the
institutional works.
Contractors Field Organization and Equipment

This clause requires the contractor to appoint a Site Engineer in charge of the work, who shall be present all
the time on the site when the work is in progress. This Site Engineer shall carry out the work as per the
drawings and specifications issued to the contractor. Any instruction given to the site Engineer by the
Architect is as good as given to the contractor.
Taxes
The item rates shall include all taxes, duties and octroi etc. legally payable. That means no additional payment
towards any tax shall be paid by the owner. (Works contract tax also).
Statutory Obligations, Notices, and Fees etc.

If a contractor uses the area of road for dumping a building material during the construction period, the local
authorities (Municipal corporation etc) charges rent or fees for that, which the contractor is required to pay
under this clause. The contractor shall hand over the receipt of payment or the N.O.C. to the architect, which
may be required for the process of Building Completion. Similarly, the plumbing contractor shall obtain a
N.O.C. from the Drainage Department and the water department as a part of his duties under this contract.
Similarly, the Electrical contract has to submit test-report to the concerned authority and obtain the Electrical
supply to the property as a part of his duty under the contract. Architect need not spend his time for these
works.

Water for Construction

It shall be made clear by the architect as to what is the source of the water supply to the site during the
construction. The contractor also before working out his item rates shall visit the site and take into account
the cost of water that may be required for the construction and shall provide for that in the item rates.
Sub-Contractors
It is a usual practice that a General Contractor in turn engages the sub-contractors or the labour contractors
for the different of work involved in a construction project. You may not see same workers doing concreting
who had excavated for foundations.
1. Under this clause, the contractor is required to submit a list of sub-contractors he intends to engage for
the major parts of the work. Any of the Sub-contractors disapproved by the Owner/Architect shall not be
engaged on the work.
2. The Architect shall have powers to obtain the estimate and select other agencies to carry out any of the
works. Such agencies like specialists, suppliers, tradesman selected by the Architect or the Owner are
called nominated sub-contractors. These shall be deemed to be sub-contractors engaged by the
contractor. If the contractor has a reasonable objection against a Nominated sub-contractor, he shall not
be employed by the contractor with consent of the Architect.
3. It is the contractors responsibility to get the work done as per the requirements of the contract from the
sub-contractors and the nominated sub-contractors.
4. For all the practical purposes the General Contractor shall treat a nominated sub-contractor same as sub-
contractor. Nominated sub-contractor shall carry out the work as required by the contract and to the
satisfaction of the contractor and of the Architect.
5. Except the provision of Fire Insurance, which is to be done by the General Contractor, all other provision
of the contract on part of the contractor is to be observed by the nominated sub-contractors.
6. The nominated sub-contractor as well as the sub-contractor shall indemnify the contractor against the
same liabilities in respect of their works as those for which the contractor is liable to indemnify the owner
under this contract, such as act of negligence, omission, default of sub-contractor or his servants etc.
7. The contractor shall pay the sub-contractor within 14 days after the receipt of a certificate for the
payment for the Bill in which sub-contractors work is included.
8. The architect shall have right of Access to workshops and other places of works of sub-contractors and
nominated sub-contractors. [This gives an authority to the Architect if he wishes to inspect fabrication
windows, grilles, M.S. Gate, M.M. Tiles or any other materials etc. at the workshop or factory.]
9. The contractor can retain the proportionate amount from the payment due to the Nominated Sub-
Contractor, proportionate to the retention kept by the Architect in R.A. Bill of the contractor.
10. The Architect has an authority to ask the contractor whether payments are made to the sub-contractors
and the Nominated sub-contractors as per the previous certificate of the payment, before issuing the next
certificate.
11. The contractor shall not grant an extension of time to a Nominated sub-contractor without the permission
of the Architect.
12. The contractor shall allow for general attendance upon sub-contractors and also free use of plant
scaffolding, use of sanitary conveniences, storage facilities for material and reasonable facilities for
carrying out their works.
Prime Cost
Even in an item rate tender and contract, it is sometimes convenient to include in Contract Bill and in contract
sum Provisional Sum in respect of materials or goods to be fixed in the construction work about which details
are not final or the owner wants his freedom to finalize it later.
Separate Contract
The items of work that are with the main contractor are carried out by other agencies which are called sub-
contractors. This includes nominated sub-contractors as well. The owner has no separate contract or an
agreement signed with these agencies. The sub-contractors work under the control of the main contractor. In

order to complete the project in all the respects, there could be certain agencies required to be engaged. Their
work could be out of the scope of the main contractor. By including this clause, the owner reserves his right to
engage such other contractor, while the main contractor is still working on the site.
Variation, Provisional and Prime Cost Sum: Explanation

During the construction, the architect may find it necessary to alter or modify the design or item of
construction and may ask the contractor accordingly. This change in item is called Variation in work. As per
this clause, the contract is not vitiated because of variation. The architect may instruct the contractor to
make the changes in the abstract of an item.
PROVISIONAL SUM: At the estimate level, without going into the details, a certain amount based on earlier
experience, is provided in the tender against an item by the architect, usually for purchases of goods. This
amount is further included in Contract Sum.
Certificate and Payments

It is one of the responsibilities under taken by the Architect, as per this contract to work like an auditor. Any
payment to be made by the owner to the contractor shall be made only with the recommendation of the
Architect.
Claim for Extra

If instructions of the Architect given on the site involves an extra work where by the contractor may plan to
claim an extra rate, the contractor shall inform the Architect before proceeding with the said work on the site.
Deduction for Uncorrected Work

Any work damaged or not done in accordance with the contract, and in the opinion of the Architect, it is not
likely or helpful to try to correct it or improve upon it, the Architect in such a case reduce or make an equitable
deduction from the contract price of that work.
Fluctuation
This clause is not suitable in present day situation. In the developing economy of the country, the market is
expected to be unsteady. Instead of this clause, the clause of Basic Rates of Materials as explained is
recommended.
Unfixed Goods and Materials

As per this clause, the building material brought on the site shall not be removed from the site without a
written instruction of the Architect, more as when the value of such material on the site is certified by the
Architect for the payment in R.A. Bill. The reason being since now, the owner has paid for that material, it
belongs to the owner; therefore it shall not be removed from the site without permission except for its use in
the construction. However, safety and security of the material on the site shall be the contractors
responsibility.
Materials and Workmanship

1. All building materials and workmanship shall be as per the relevant code of I.S.I. specifications. The
contractor shall remove from the works site any material and/or work, which in the opinion of the
Architect are defective or unsuitable and shall substitute a proper material and/or a workmanship at his
own cost.
2. Whenever a special make or the brands are called for, they are mentioned as a standard. Others of equal
quality may be used with a written approval from the Architect. Such an approval must be taken within 30
days after signing of the contract. Thereafter a request for substitution may be denied.
Defects
The contractor shall make good, at his own cost and to the satisfaction of the architect, all the defects,
shrinkages, small faults arising in the work that may appear within Defects Liability Period.

The contractor shall make good the defects as directed by the architect, at his own cost, within a reasonable
time as given by the architect.
Water proofing of Terrace

The main contractor, preferably along with the sub-contractor for the water proofing work shall give in writing
on stamp paper, a guarantee for Ten Years to the owner, about the water proofing work.
Extension
The extension of time to complete the project can be given by the architect only under certain conditions
given below. The contractor has to give a written notice to the architect immediately if he has lost the time of
work for the reasons beyond his control such as given below. If the reason is true and reasonable, the
architect shall inform in writing to the contractor and the owner as well, the number of days of extension
granted beyond the date of completion.
Damages for Non-completion on Time

If the contractor fails to complete the work by the date specified in Appendix or within extended time given
by the architect, then the contractor shall pay the owner or allow to the owner to deduct the penalty from any
amount due to the contractor. This amount of penalty shall be worked out at the rate of interest agreed upon
and written in Appendix, on the contract amount for the period of Extra Time taken by the contractor to
complete the project.
Virtual Completion and Defects Liability Period

When in the opinion of the architect, the project (work) is practically completed; the Architect shall issue
immediately a certificate (a letter to the owner with a copy to the contractor) to that effect. The date of
completion of the project stated in this letter shall be referred for all the purposes of the conditions on this
contract.
Loss and Expense Caused by Disturbance of Regular progress of Work

This is one evidence that this is a balanced contract. If there be any hindrance in the normal progress of work
on the site because of the following reasons, this contract provides a monetary compensation to the
contractor. The contractor shall make a written application to the architect stating the cause of hindrance and
the direct loss or expense incurred by him. If the contractor is not reimbursed by the payment under any other
provision in this contract, then the architect shall ascertain the amount of such loss or expense and add that
amount to the certificate for payment to the contractor.
Injury to Persons
In case of a road accident, the owner of the vehicle is held responsible. He may not be driving himself or even
he may not be present in the car at that time of the accident. But the law holds the owner also responsible.
Similarly, if there be any accident on the work site and if someone is injured or killed, it becomes a Police Case.
As per the law, not only the contractor but also the owner of the property and the architect are arrested for
an inquiry. It is not only injury to a person or loss of life, but damage or loss to the property of others become
a matter of liability and have to be compensated. In order to protect the owner from a legal hustle; this clause
is included in the contract. As per this clause, the contractor indemnifies the owner against any liability, loss,
claim or legal proceedings whatsoever arising under any law in respect of a personal injury to or a death of any
person on the work site; unless due to the act of neglect of the owner or of any person for whom the owner is
responsible.
Insurance against Injury to Persons or Property

This clause requires the contractor to take necessary insurance policy to protect everyone on the site against
an injury and damage to any property. The contractor shall in turn make it necessary to the sub-contractors to
take a similar insurance to cover their workers.

Insurance of the Works against Fire etc

Your attention is drawn to the footnote on the page of the General conditions of contract. This Clause is
divided into three parts. 1) Clause A and B is applicable to the new building under the construction where the
contractor is required to take the policy. Clause 2) A and B is applicable to the erection of a new building if the
owner is to take a policy. And 3) A, B up to B (iii) is applicable to the alterations of or an extension to the
existing building.
Determination by the Owner

A good form of an Agreement or a Contract (includes partnership in business etc) shall have provision and
procedure laid down to break the contract. This contract document also lays down a definite procedure for
both the parties to contract, to break the contract under certain situation.
Determination by the Contractor

This clause is one more evidence to prove that this is a balanced document. It gives the owner right to break
the contract under certain conditions. Similarly, it provides an authority to the contractor to get away from the
bonds of this contract under a particular situation.
Co-ordination of Work
This clause requires the contractor to hold the meetings on a site from time to time with his sub-contractors,
persons, agencies on the separate contracts and with the Architect. A good contractor to manage his work
properly shall hold such meetings on his own without you asking for it. But in a way, this clause authorizes an
Architect to ask the contractor to call all the sub-contractors and the agencies to be present on a site on the
date and time of the site visit of the Architect for a meeting with the Architect. The time of periodical site visits
of the Architect (or his representative or a project architect etc) shall be prefixed and always known to the
contractor; so that it shall be the responsibility of the contractor to present everyone of them on the site
including contractors Site-Engineer. The clerk of works is supposed to be on the site and more particularly at
the time of the visit of the Architect. In this reference, the word Architect means the Architect himself or his
representative who is looking after the project called a project Architect or a Structural Engineer Consultant,
working for the Architect.
Labour
These contract conditions prevent an employment of a child labour below 14 years of age. When a female
labour is engaged, the contractor shall make a necessary provision for safeguarding the small children.
Protection of Trees and Shrubs

An Architect as a tree lover shall implement this clause to protect existing or newly planted trees and shrubs
on the site.
Excepted Matters
It would be an endless arguments and discussions if all the aspects of the work are kept open for an argument.
Hence, this clause.
As per this clause, in certain matters, decision, opinion, direction of the Architect shall be final conclusive and
binding on both the parties to this contract.
Arbitrator
Any dispute in our civilized society can be or shall be referred to a Court of Law. But to seek a justice from the
court of law is a lengthy process and can be delayed by either of the parties. Justice delayed is justice
denied. Therefore, for the speedy settlement of matters, the process of Arbitration is built in the contract
conditions.

Protection and Cleaning

This clause requires the contractor to protect and prevent the work from the damage by providing a
temporary covering, a boxing or other construction as required, during the progress of work till handing over
building to the owner.
Tolerance
The dimensions called for on the drawings shall be observed properly in the work carried out on the site as
well as in the fabrication of elements. The contractor shall exercise every care to ensure that all the structural
members are sufficiently in plumb and true to the dimensions called for on the drawings. In case of a separate
contract, the contractor whose work does not confirm to the dimensions called for shall be liable for all the
expenses, which may incur for a rectification or a replacement as required by the Architect. Architects
decision in this respect shall be final and binding on the parties concerned.
ARBITRATION
Arbitrator
Explanation: Any dispute in our civilized society can be or shall be referred to a Court of Law. But to seek a
justice from the court of law is a lengthy process and can be delayed by either of the parties. Justice delayed
is justice denied. Therefore, for the speedy settlement of matters, the process of Arbitration is built in the
contract conditions. as per this clause
1. Any or all disputes and difference arising out of or in connection with the contract, during the progress of
work or after the completion, before or after the determination, the abandonment or the breach of
contract shall be refereed to and settled by the ARCHITECT of the contract.
2. In case of the expected matters, the decision of the Architect is final and binding on both the parties and
there shall be no ARBITRATION of these matters.
3. In case, if either of the parties to the contract be dissatisfied with the decision of the Architect in matters
other than the expected matters, shall give within 28 days after receiving such a decision, a Notice to the
other party through the Architect, regarding his desire to go in for Arbitration.
Procedure to be followed:-
A) Single Arbitrator or Sole Arbitrator
If both the parties agree or concur to the selection of an Architect who is a follow member of the Indian
Institute of Architects; should approach him and appoint him as the arbitrator, to study and settle the
disputed matter. Both the parties shall present their case before the Single Arbitrator, personally or
through an Attorney, on hearing both the parties and studying the papers etc. The Arbitrator shall within a
reasonable time, give his Award, i.e. the decision, which shall be final and binding on both the parties. The
Arbitrator shall give the directions in this Award regarding the cost and the incidental charges of an
Arbitration to be borne by whom etc. This submission to an Arbitrator shall be deemed to be a submission
to an Arbitration within the meaning of the Indian Arbitration Act, 1899 or any modification thereof, for
the time begin in force.
B) Joint Arbitration
In case if there is no agreement between the two parties upon the appointment of a single Arbitrator,
then each of the parties shall appoint his own Arbitrator who shall be a fellow member of the Indian Institute
of Architects, called joint Arbitrators.
Umpire
The Joint Arbitrators before proceeding with their work shall mutually agree upon a third person who shall be
an Architect and a fellow member of the Indian Institute of Architects. The Joint Arbitrators shall approach

such a third Architect and request him jointly to be their umpire, in case if it is needed. Upon his acceptance to
work as an umpire, the Joint Arbitrators shall proceed with their work.
The Joint Arbitrators shall hear the case jointly, study the papers etc. and try to come to an agreement about
their AWARD. If the Joint Arbitrators agree upon their decision on all the points of dispute, then they can give
their AWARD. If the Joint Arbitrators defer in their decisions of the points of dispute, then the Joint Arbitrators
shall refer the matter of the Umpire. The Umpires decision shall be final and binding on both the parties. One
should note here and appreciate the importance of appointing an umpire before commencing the hearing of
the case by the joint Arbitrators. The selection and appointment of the umpire shall be done with unbiased
and impartial mind. Therefore, it shall b done before the start of a hearing.

QUESTIONS
Two Marks:
1. Define a contract?
2. Name two conditions of void contract?
3. What is meant by arbitration?
4. What is a lump sum contract? Mention any two advantages.
5. What are the elements of contract?
6. What is Indian Stamp Act?
7. What are the contents of contract document?
8. What are the types of tender applicable to contract?
9. Explain interim award?
10. Explain the three types of Arbitration?
11. Write short notes on arbitrator.
12. What is retention amount?
13. Why is necessary for a contractor to visit the construction site prior to tendering?
14. What is the role of a clerk of works in a construction site?
15. Explain the importance of Articles of Agreement in a contract document.
16. Differentiate between arbitrator and umpire.
17. What do you understand by the term award?
18. A tenderer is required to visit the construction site before offering his tender. why?
19. What is your understanding of the term Retention Amount?
20. Explain the importance of certificate in a construction process.
21. What are liquidated damages?
22. What is the meaning of the term determination of contract?
23. Why is the necessary for a tenderer to inspect the construction site before tendering?
24. Who is clerk of works? What are his duties?
25. What is the meaning of the term Award in an arbitration process?
26. What is the purpose of certificates in a construction agreement?
27. Who is resident engineer?
Sixteen Marks:
1. Explain briefly the procedure you would follow in the selection of a contractor for a building project
2. What are the qualifications of an arbitrator? What are the advantages of settling dispute through
arbitration?
3. Explain the contents of Articles of Agreement.
4. Enumerate the conditions of a valid contract.
5. Explain in detail a contract document?
6. Describe in detail the factor to be considered while calling a Lump sum contract?
7. Describe in detail the elements of contract?
8. Establish the procedure for opening and acceptance of tenders. Compare and contrast Item Rate tender
with Lump Sum tender establishing where each is recommended?
9. Explain contract and when does it become void? Establish the procedure and precautions to be adopted to
avoid variation and extras in contractors bill.
10. Explain articles of agreement and its importance in the actualization of a contract Explain Breach of
contract and termination of contract by the employer.
11. Elucidate the purpose and advantages of Arbitration. Compare and contrast Arbitration Agreement Order
of Reference?
12. Elucidate on the appointment and powers of an Arbitrator. Compare and contrast Arbitration and
Valuation. What is Award?
13. Discuss in detail the conditions for termination of a contractor as per the contract.
14. Explain the importance of Articles of Agreement in a contract agreement.
15. Elaborate on the conditions and duties pertaining to an architect in a contract.

16. What is the significance of an arbitrator? How is an arbitrator selected?

17. What are the types of arbitration? Discuss in detail the situation under which the varying types can be
implemented.
18. Difference between Item rate tender and Lump sum tender. (8)
19. Retention amount is Security advance paid in installments. you agree? Give reasons for you reply. (8)
20. What is the role of an architect in the certification process? (8)
21. Explain the procedure involved in giving an interim certificate. (8)
22. What are the precautions an architect should take while issuing a final certificate? (8)
23. What is defects liability period in a contract? (8)
24. Explain the circumstances under which a contract can be terminated by a contractor and an employer. (8)
25. Differentiate between assigning and subletting as mentioned in the general conditions of contract. (8)
26. Between whom can disputes arise in a building contract? How will the arbitration process help in settling
the disputes? (8)
27. Explain the provisions incorporated in a contract document with regard to arbitration.
28. Which are the matters that are not open for arbitration? Why are they beyond the purview of arbitration?
(8)
29. Under that situations an umpire will be appointed in arbitration process. What is his role?
30. What are the advantages and disadvantages of Item rate and labor tender? (10)
31. Explain briefly articles of agreement in a contract document.
32. Elaborate on the conditions pertaining to architects on contract. And how he will execute the contractors
bill certification.
33. Define the role and importance of arbitration. (8)
34. Explain the different types of the arbitration. (8)
35. Explain the difference between the Interim Bill and Final Bill raised by the contractor with particular
reference to architects responsibility. (8)
36. Explain the importance of certificates issued by an architect. (8)
37. As per the construction agreement, a contractor has certain obligations in facilitating supervision of
construction by an architect. Elaborate on the same. (8)
38. Explain the role of Engineer in-charge in a construction site.
39. Bill of quantities plays an important role in a Item Rate Tender. Give reasons. (8)
40. Explain in detail the contents of Appendix in construction agreement and briefly touch on the importance
of at least 4 item of the appendix.
41. Differentiate between mobilization advance and security deposit.
42. What are the obligation of contractors with regard to administration and execution of work as per the
construction agreement?
43. Why should there be a termination clause in any agreement. what circumstances can a contract be
terminated by an employ.
44. What are the various methods by which a dispute between contractor and an employer be resolved?
45. What are the advantages of arbitration when compared to a process.
46. Differentiate between sole arbitrator and joint arbitrators. what circumstances will an umpire be
appointed.
47. What is an award and how is it binding on the parties involved arbitration.
48. Bring out the differences between item-rate, lump sum an demolition tender.(8)
49. Elaborate on the importance of Bills of Quantities in an Item-rate tender. (8)
50. As per the contract agreement contractors are obliged towards facilitating architects supervision.
Elaborate. (8)
51. What are the provisions in the contract agreement, for a contract to terminate the agreement? (8)
52. What is the duty of an architect when a contractor raises a Bill? (8)
53. What are certificate? In issuing a final certificate, an architect has to exercise certain precautions. What
are they? (8)
54. What are the advantages of settling a dispute through arbitration process? (8)
55. They are certain Excepted matters beyond arbitration. What are they? (8)
56. When joint arbitrators have disagreement over solving a dispute. what happens? (8)

57. What is an arbitration agreement? (8)

58. Explain the role of umpire in an arbitration process.

UNIT -III
NEW TRENDS IN PROJECT FORMULATION AND EXECUTION
Turn key offer (Expression of interest, Request for Proposal Document)

A turnkey or a turnkey project (also spelled turn-key) is a type of project that is constructed so that it could be
sold to any buyer as a completed product. This is contrasted with build to order, where the constructor builds
an item to the buyer's exact specifications, or when an incomplete product is sold with the assumption that
the buyer would complete it.
Turnkey refers to something that is ready for immediate use, generally used in the sale or supply of goods or
services. Turnkey is often used to describe a home built on the developer's land with the developer's financing
ready for the customer to move in. If a contractor builds a "turnkey home" they frame the structure and finish
the interior. Everything is completed down to the cabinets and carpet. "Turnkey" is commonly used in the
construction industry, for instance, in which it refers to the bundling of materials and labor by sub-contractors.
'Turnkey' is also commonly used in motorsports to describe a car being sold with drive train (engine,
transmission, etc.) to contrast with a vehicle sold without one so that other components may be re-used.
Similarly, this term may be used to advertise the sale of an established business, including all the equipment
necessary to run it, or by a business-to-business supplier providing complete packages for business start-up.
An example would be the creation of a "turnkey hospital" which would be building a complete medical center
with installed medical equipment.
(Expression of interest, Request for Proposal Document, Conditions for inviting turnkey offer,
finalization of the bidder). Same processes as followed in tender.
Current practices in Project execution:
1. BOT (build-operate-transfer)
2. BOOT (build-own-operate-transfer)
3. BOO (build-own-operate)
4. BLT (build-lease-transfer)
5. DBFO (design-build-finance-operate)
6. DBOT (design-build-operate-transfer)
7. DCMF (design-construct-manage-finance)
1. Build operate and Transfer (BOT)

Buildoperatetransfer (BOT) or buildownoperatetransfer (BOOT) is a form of project financing, wherein
a private entity receives a concession from the private or public sector to finance, design, construct, and
operate a facility stated in the concession contract. This enables the project proponent to recover its
investment, operating and maintenance expenses in the project.
Due to the long-term nature of the arrangement, the fees are usually raised during the concession period.
The rate of increase is often tied to a combination of internal and external variables, allowing the proponent
to reach a satisfactory internal rate of return for its investment.
Introduction
In recent years, a growing trend emerged among governments in many countries to solicit investments for

public projects from the private sector. The main reasons for this trend are a shortage of public funds and
hands off approach of government agencies. The Build Operate Transfer approach (BOT) is an option for the
government to outsource public projects to the private sector. With BOT, the private sector designs, finances,
constructs and operates the facility and eventually, after a specified concession period, the ownership is
transferred to the government. Therefore, BOT can be seen as a developing technique for infrastructure
projects by using private initiative and funding. Such infrastructure projects include a wide array of public
facilities with the primary function to serve public needs, to provide social services and promote economic
activity in the private sector. The most common examples are roads, bridges, water and sewer systems,
airports, ports and public buildings (Vaughan and Pollard, 1984).
In addition to government, the private sector may initiate BOT projects when there are limited funds available
and there are no enough resources to execute successfully a required building project. Examples can be seen
in non-profit hospitals and educational institutions as well as manufacturing facilities. However, none of those
cases are included in this book, which focuses on government related projects. Several project delivery
schemes have developed in recent years (Diaz, 1994). The traditional design-bid-award was enhanced by the
introduction of the project manager as a consultant to the owner, where project manager advises the owner
in formulating a building strategy and supervises the construction on the owners behalf. As a consulting
service, the project manager works in parallel with the architect for a flat rate fee, with no fiduciary or
construction risk. Design- build is a one-stop shop for design and construction. Architects and contractors
work under one contract, where total responsibility for all stages of the project is placed with both parties.
Design-build projects are often of limited sophistication, but hold considerable promise for the future as a
partnership process of project delivery. Bridging allows the separation of schematic design from design
development, with the latter grouped together with the general contractor. Such a project delivery scheme
allows THE BUILD OPERATE TRANSFER APPROACH 5 for more sophistication and for transfer of design across
geographical and economic boundaries.
With turnkey contracts, the owner buys a package of site, design and finished building, while the developer
secures financing, manages the project flow and coordinates the architect and the contractor. Such contracts
are usually limited in complexity1. BOT is closer to total product delivery where in addition to financing and
development, the supplier is also responsible for the operation of the facility.
BOT in construction
Build Operate Transfer is a major startup business venture where private organizations undertake
development and operation of a facility normally done by the government. The termination of the private
sector involvement occurs at the return of the ownership of the facility to the government after a fixed
concession period, usually 25 to 40 years (Tiong, 1990). Among the various definitions of BOT, the following
definition is adopted in this book that constitutes the premise for conducting this research. In the BOT
approach, a private party or concessionaire retains a concession for a fixed period from a public party, called
principal (client), for the development and operation of a public facility. The development consists of the
financing, design and construction of the facility, managing and maintaining the facility adequately, and
making it sufficiently profitable. The concessionaire secures return of investment by operating the facility and,
during the concession period, the concessionaire acts as owner. At the end of the concession period, the
concessionaire transfers the ownership of the facility free of liens to the principal at no cost3. A key
characteristic of BOT is private financing. In BOT, the government subcontracts the entire development
process, including the associated risks, to the private entity. One of these risks is financing, which must be
obtained by the concessionaire, who is ultimately responsible for all aspects of the project.
A prerequisite for private financing is a need for the facility to be developed; for example, a highway extension
due to increasing traffic jams, more bed space in detention and correctional facilities due to an increase in
crime and the number of incarcerated individuals, a tunnel or bridge to solve traffic problems and facilitate
accessibility, or a sewage system or power generation to support the growth in population and industry. If

there is no obvious requirement for the facility, private parties will refuse to participate and provide financial
support. Only after market analysis justifies a need will private parties be willing to financially participate as
well as become involved in developing the facility. BOT is just one of the many different project delivery
schemes within the context of privatization or public-private-partnerships. The two other schemes that appear
most similar to BOT are Build Own Operate (BOO) and Build Transfer Operate (BTO). In all three cases, the
private party retains revenues from operating the facility.
In BTO, the private party transfers the ownership of the facility directly after the delivery and operates the
facility on behalf of the principal. In BOO, the private party retains ownership of the facility, makes returns on
investment by operating it for its useful life, and may sell it at any point at market value. Besides the three
most common approaches, BOT, BOO and BTO, other variations can also occur (Fig. 0.3). All differ from each
other in the way the level of risk is divided between the private and public parties. Each form is a kind of a
public-private-partnership but all are unique in allocating risks to the individual parties.
MAJOR PARTICIPANTS IN BOT PROJECTS

Five major participants are identified in every BOT project and Fig. 0.4 shows the typical structure. Very
simply, the principal grants the concession to the concessionaire. The concessionaire, usually a consortium of
companies, undertakes the financing and development of the project. Financing is obtained from sponsors and
lenders. The contractor builds the facility and the operator runs the facility.
Principal
In a BOT project, the principal is usually a government agency, a local or federal government body that
recognizes the need for a public facility but is unable to financially support the project. The government
agency is thus forced to look for alternative options.

Concessionaire
After the identification of the need for the facility, the government, following a due process, will grant a
concession to the concessionaire. The concessionaire is usually a consortium and takes the responsibility of
developing (designing, financing and constructing), maintaining and operating the facility, on behalf of the
principal. The concessionaire is the owner of the facility during the concession period and realizes profits on
the initial investment through the usage of the facility
Investors
Financing is supplied by the private sector and the investors include both shareholders and lenders. The
shareholders invest money in exchange for equity, and lenders support the concessionaire during negotiations
with the principal with promises for loans to be available during the development of the project. Lenders may
include banks, insurance companies
and bond holders.
Contractor
The concessionaire commissions a contractor with the construction of the facility. In most cases, the
contractor is part of the concessionaires consortium and involvement is favored by all concerned parties.
During the early stages of the process the contractors involvement assures the consortium of the most
effective and efficient design and execution of the project. Ultimately, the contractor is responsible for the
construction of the project and for hiring subcontractors, suppliers and consultants.
Operator
The operator is also in the concessionaires service and manages the operational stage of the facility. Similar to
the contractor, the operator is usually part of the concessionaires consortium, because of the critical role in
the revenue stream. In addition, the importance of operating knowledge for programming, financing, design
and construction is required. Often the operator is supported by a government agency or in some cases, is the
agency. In the Wijker tunnel case, the facility is entirely operated by the government maintenance department
for bridges, dikes and roads, and in
STAGES OF BOT PROJECTS

Preliminary study
The preliminary study usually takes place prior to the involvement of the concessionaire. This stage is
executed by, or on behalf of, the principal. Feasibility studies are necessary to prove the forecasted success of
the project, in order to attract private funding. Alternatively, a private party may identify a need and initiate
the BOT project and in such a case, the preliminary study is conducted by the private entity with limited
government involvement.
Selection process
The selection process depends on who initiates the project. In a public selection process where the initiative is
coming from the public sector (government), a request for qualification is distributed. After receiving
applications, the government selects a few consortia to submit proposals (request for proposals) and from
these a concessionaire is chosen. During this process, the consortia will group interested parties as required
for the efficient and adequate execution of the project. Alternatively, in a speculative selection process, the
private sector initiates the project and contacts the appropriate government agency for approval. The project
is granted after proper negotiations.
Project implementation
After the selection stage and the foundation of the concessionaire, the proposal is finalized. Together with all
the involved parties, the concessionaire develops a detailed program and preliminary design, and applies for
permits. This process can be shortened if a government agency is actively participating. Once permits are
issued, the final concession agreement is signed. During the project implementation stage, in addition to the
interests of the involved parties, the interests of the external parties also require attention. The influential
power of politics, the opposition, and environmental agencies are significant factors and, if not taken into

account, may hinder or even dissolve the project.
Construction
Once the necessary permits are obtained, construction begins. Often BOT projects are fast track projects
where the design is not complete when construction starts. This is feasible because of congruent financial
interests within the members of the consortium and the pressing need to complete construction and start
collecting revenues. Less controversial designs allow a quicker construction period with fewer uncertainties.
Operation
During the operation stage, the facility is operated and maintained by the operator who is paid by the
concessionaire. The concessionaire, as the owner of the facility during the operation period, is obligated to
operate the facility in a manner that adequately services the public user. The concessionaire is also
responsible for maintaining the facility in working condition. Both the concession and operation agreements
specify the condition of the facility at the time of transfer to the principal.
Transfer
The facility is transferred to the principal, usually at no cost (Fig. 0.10). Transfer time is determined in the
concession agreement. Should the principal choose to take over the facility earlier than the agreed concession
period; the concessionaire will be financially compensated for the investment. After transfer, the principal is
the sole owner of the facility and can choose to operate and maintain the facility directly or hire an
independent operator. Although a transfer has not taken place in any of the cases in this book, it can be
expected that the principal will continue with the same operator, as in the concession period, due to history of
involvement and experience with the facility. If the principal is the government, it may choose after transfer
not to charge the final users anymore.
In essence, the facility at that time will have become public, and its maintenance and operation can be funded
by indirect taxation. Another issue to be considered is to what extend the principal wants to receive the
facility. After a typical concession period of 30 years, the facility may have become obsolete and could need
major rehabilitation or require more resources to operate than a new facility. In prisons for example, the
facility may be inadequate, or in a power plant the method of generating energy may be inefficient. Active
participation of the principal during the concession period may keep a facility up to standards or, at transfer, a
BOT project could in fact lead to a new BOT project.
Due to the external and internal particularities of every BOT project, the actual organization and process may
be different to the presentation in the previous paragraphs. The starting and completion period of each stage
in a BOT project can change due to a variety of factors, both external and internal to the project. Among them
are the complexity of the development process, government regulations, political influences, concerns of
environmental groups, and neighborhood pressures. Such effects have an m a j o r influence on the progress
of a project, likely to stall or change theoretical models. Thus, the development of a precise and detailed
framework applicable for every BOT project is not possible and this must be taken into consideration for each
case study in this book that presents the framework of a particular project and its external and internal
conditions.
2. Build Lease operate and Transfer (BLOT)

BLOT (build, lease, operate, transfer) is a public-private partnership (PPP) project model in which a private
organization designs, finances and builds a facility on leased public land. The private organization operates the
facility for the duration of the lease and then transfers ownership to the public organization.
The BLOT model is one of several related PPP project types including BOOT (build, own, operate and transfer)
and BOO projects (build, own, operate).

BUILD, designed and tailor-made as per building faade.

OPERATE, install, commission and operate.
LEASE, on monthly rentals for minimum five years contract.
TRANSFER, thereafter transferred to you at an agreed value.
3. BOO
BOO (build, own, operate) is a public-private partnership (PPP) project model in which a private organization
builds, owns and operates some facility or structure with some degree of encouragement from the
government. Although the government doesn't provide direct funding in this model, it may offer other
financial incentives such as tax-exempt status. The developer owns and operates the facility independently.
The BOO model is one of several related PPP project types including BOOT (build, own, operate and
transfer), BLT (build, lease, transfer) and BLOT (build, lease, operate, transfer).
4.BOOT (build-own-operate-transfer)
A BOOT structure differs from BOT in that the private entity owns the works. During the concession period
the private company owns and operates the facility with the prime goal to recover the costs of investment
and maintenance while trying to achieve higher margin on project. The specific characteristics of BOOT make
it suitable for infrastructure projects like highways, roads mass transit, railway transport and power
generation and as such they have political importance for the social welfare but are not attractive for other
types of private investments. BOOT & BOT are methods which find very extensive application in countries
which desire ownership transfer and operations including. Some advantages of BOOT projects are:
Encourage private investment
Inject new foreign capital to the country
Transfer of technology and know-how
Completing project within time frame and planned budget
Providing additional financial source for other priority projects
Releasing the burden on public budget for infrastructure development
5.BLT (build-lease-transfer)
Under BLT a private entity builds a complete project and leases it to the government. On this way the control
over the project is transferred from the project owner to a lessee. In other words the ownership remains by
the shareholders but operation purposes are leased. After the expiry of the leasing the ownership of the
asset and the operational responsibility are transferred to the government at a previously agreed price. For
foreign investors taking into account the country risk BLT provides good conditions because the project
company maintains the property rights while avoiding operational risk.
6.DBFO (design-build-finance-operate)
Designbuildfinanceoperate are a project delivery method very similar to BOOT except that there is no
actual ownership transfer. Moreover, the contractor assumes the risk of financing till the end of the contract
period. The owner then assumes the responsibility for maintenance and operation. Some disadvantages of
DCMF are the difficulty with long term relationships and the threat of possible future political changes which
may not agree with prior commitments. This model is extensively used in specific infrastructure projects such
as toll roads. The private construction company is responsible for the design and construction of a piece of
infrastructure for the government, which is the true owner. Moreover the private entity has the responsibility
to raise finance during the construction and the exploitation period. The cash flows serve to repay the
investment and reward its shareholders. They end up in form of periodical payment to the government for the
use of the infrastructure. The government has the advantage that it remains the owner of the facility and at
the same time avoids direct payment from the users. Additionally, the government succeeds to avoid getting
into debt and to spread out the cost for the road over the years of exploitation.

7.DCMF (designconstructmanagefinance)
Some examples for the DCMF model are the prisons or the public hospitals. A private entity is built to design,
construct, manage, and finance a facility, based on the specifications of the government. Project cash flows
result from the governments payment for the rent of the facility. In the case of the hospitals, the
government has the ownership over the facility and has the price and quality control. The same financial
model could be applied on other projects such as prisons. Therefore this model could be interpreted as a
mean to avoid new indebtedness of public finance.

QUESTIONS
Two Marks:
1. What are the advantages of a turnkey contract?
2. What are the various current practices in Project execution?
Sixteen Marks:
1. Explain BOLT form of project financing with a suitable case study.
2. Explain the conditions for inviting turnkey offer and the process involved in the finalization of the bidder.

UNIT - IV
IMPLICATIONS OF GLOBALISATION IN ARCHITECTURAL PRACTICE
Globalization
Globalization (or globalization) is the process of international integration arising from the interchange of world
views, products, ideas, and other aspects of culture. Advances in transportation and telecommunications
infrastructure, including the rise of the telegraph and its posterity the Internet, are major factors in
globalization, generating further interdependence of economic and cultural activities.
The term globalization has been in increasing use since the mid-1980s and especially since the mid-1990s. [6]
in 2000; the International Monetary Fund (IMF) identified four basic aspects of globalization: trade and
transactions, capital and investment movements, migration and movement of people and the dissemination of
knowledge. Further, environmental challenges such as climate change, cross-boundary water, air pollution,
and over-fishing of the ocean are linked with globalization.
Globalizing processes affect and are affected by business and work organization, economics, socio- cultural
resources, and the natural environment.
In economical aspect
This is the integration of economies, industries, markets, cultures and policy-making around the world.
Globalization describes a process by which national and regional economies, societies, and cultures have
become integrated through the global network of trade, communication, immigration and transportation.
In the more recent past, globalization was often primarily focused on the economic side of the world, such as
trade, foreign direct investment and international capital flows, more recently the term has been expanded
to include a broader range of areas and activities such as culture, media, technology, socio-cultural, political,
and even biological factors, e.g. climate change.
Example
Global trade has grown enormously since WWII; international trade in manufactured goods alone has grown
an estimated 100 times from $95 billion to $12 trillion in the 50 years since 1955. However, globalization is
much more than just trade.
In the last twenty years the breadth and depth of links between nations and between regions has grown
enormously. Communications costs have declined dramatically allowing easy daily contact via the web and
telephone, enabling the outsourcing of IT and other Services, to India for example, and the rise in global
work teams.
Other critical links are immigration and transportation, particularly airlines. The International Organization for
Migration estimates that there are two hundred million migrants around the world today, they have largely
immigrated from the emerging to the developed countries, particularly to the U.S., Canada, Australia, the U.K.
and Continental Europe. Though there are tensions at times in Europe and elsewhere this immigration has
changed the face of these regions and increased the personal links across borders very considerably.
Finally the transportation of people and goods has increased very substantially in the last few decades with
great growth on the number of flights across borders. During the 80s and 90s growth rates in the number of
airlines seats offered of 5% a year were not uncommon, in 2010 there are over 2.3 million flights per month.

With this great growth in flights, this has allowed stronger business and personal links. Today we see a world
much more interlinked than in the past.
Advantages of Globalization
Globalization has several advantages on the economic, cultural, technological, social, and other fronts.
Globalization means increasing the interdependence, connectivity, and integration on a global level, with
respect to the social, cultural, political, technological, economic, and ecological levels. It is the
collaboration of countries to provide a boost to trade practices, and also to reduce cultural differences. Its
various advantages can be felt all across the globe by one and all, and also to a very large extent in our
daily lives.
Obviously, now we understand that globalization is here to stay. Here are the most common and important
advantages that globalization, over time, has brought about for mankind. These have been listed in no
particular order, and are all vital in their own way.
Peaceful Relations
Most of the countries have resorted to trade relations with each other in order to boost their economy,
leaving behind any bitter past experiences if any. Nations now try to raise capital and fortify their stand in
international trade, rather than hosting a war. Thus, globalization has induced international peace and
security in a big way.
Free Trade
Free trade is a policy in which a country does not levy taxes, duties, subsidies or quota on the import/export
of goods or services from other countries. There are countries which have resolved to free trade in specific
regions. This allows consumers to buy goods and services, comparatively at a lower cost.
Global Connectivity
Globalization has promoted international connectivity. With the use of the Internet, the world has definitely
become a smaller place. There has been exchange of thoughts and ideas which has morally boosted and
interlinked the mindset of people all round the world.
New Markets
The opportunities for new markets have increased dramatically. Numerous companies have started investing
in different countries and luring customers for their brands. These ever-expanding markets have helped
countries to raise capital in terms of foreign domestic investments, thus improving the economy of the
country.
Employment Opportunities
One of the most advantageous factors of globalization is that it fosters the generation of employment. This
happens due to the emergence of new companies and new markets, where lots of skilled and unskilled labor is
required. Immigration between countries also increases, providing better opportunities for people all round
the world. By providing employment, globalization helps in increasing the standard of living of the people, and
also reduces poverty.
Quality Products
The competition among different companies finds place at an international level. It becomes important for
the companies to focus on quality goods and services, in order to have a strong foothold in the market. The
consumer is benefited in the process, and gets quality products at cheaper rates. He/she also gets the
opportunity to select his goods from a large variety available in the market.

Environmental Protection
Mutual trade carried out by countries has brought about an understanding for the protection of the
environment from which they benefit so much. It has been accepted by most countries that action needs to
be taken in saving natural resources and wildlife, without thinking about the boundaries that separate them.
Global environmental problems like cross-boundary pollution, over-fishing in the oceans, climate change,
etc., are solved by discussions and conventions.
Good for Developing Nations

It is claimed that globalization increases the economic prosperity of developing nations. Developed countries
invest in such countries with an aim of capturing new markets, which helps them improve their infrastructure
and technologies to international levels. A lot of capital is invested in such projects, which in turn proves
fruitful to the economy of the developing nation as well.
Equality for All

Globalization has helped in creating international criminal courts, and international justice movements are also
launched to provide justice to people at a global level. Disputes are solved through global standards such as
patents, copyright laws, and world trade agreements. Thus, it has ensured that people do not get
discriminated with regard to country, caste, creed or sex.
Ease of Transportation
With the advent of globalization, there has been an immense increase in the transportation of goods and
services worldwide. Things which took weeks for conveyance can now easily be availed within a couple of
days. Due to the development of containerization for ocean shipping, transportation costs are reduced to a
great extent, lowering the cost of products in world markets.
Travel and Tourism

Globalization has promoted tourism to great heights. There are many places that have tourism as their main
source of capital generation. International trade among different countries also helps in increasing the number
of tourists that visit different places around the world.
Unity in Diversity
Globalization has helped in bringing about integrity and social understanding everywhere. The dream for a
global village becomes realistic after looking at the impact of globalization. It has helped in removing some
barriers that had kept the world divided on various grounds. There has been propagation of democratic ideas
among countries. Cross-cultural contacts grow and cultural diffusion takes place, which helps in minimizing
differences, and promotes companionship.
External Borrowing
It has often been seen that a poor country is unable to provide adequate financing to its companies, which
proves to an obstacle in the development of the country on the whole. With the help of globalization, there is
opportunity for corporate, national, and sub-national borrowers to have better access to external finance, with
facilities such as external commercial borrowing and syndicated loans.
It is a common belief that globalization plays a role just at international levels of trade and commerce, but the
fact is that it has played an important role in making our lives much more comfortable too. The phones,
apparels, gadgets or accessories that we use in our day-to-day life are being available to us through
globalization. Knowingly or unknowingly, we are all under the impact of globalization, and more importantly it
has helped in bringing international peace and justice to mankind.
Disadvantages of Globalization:
1. Developed countries can stifle development of undeveloped and under-developed countries.
2. Economic depression in one country can trigger adverse reaction across the globe.

3. It can increase spread of communicable diseases.

4. Companies face much greater competition. This can put smaller companies, at a disadvantage as
they do not have resources to compete at global scale.
5. Globalization can ruin the environment. Moving things from one area to another wastes oil, etc.
6. Globalization can ruin local economies. There is a movement that wants to buy local - especially organic
foods.
7. Globalization can lead to hyper-specialization, which can be good, but also negative.
There is something great about being a generalist. Also what if something goes wrong. To know things
generally give an incredible perspective that specialists do not have.
8. Globalization can be driven by people with "know how" and power and they can
systematically fleece the world.
What is the WTO?

The World Trade Organization (WTO) is the only global international organization dealing with the rules of
trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the worlds
trading nations and ratified in their parliaments. The goal is to help producers of goods and services,
exporters, and importers conduct their business.
Goal
There are a number of ways of looking at the World Trade Organization. It is an organization for trade
opening. It is a forum for governments to negotiate trade agreements. It is a place for them to settle trade
disputes. It operates a system of trade rules. Essentially, the WTO is a place where member governments try
to sort out the trade problems they face with each other.
Functions
Among the various functions of the WTO, these are regarded by analysts as the most important:
(i) It oversees the implementation, administration and operation of the covered agreements.
(ii) It provides a forum for negotiations and for settling disputes.
Additionally, it is the WTO's duty to review and propagate the national trade policies, and to ensure the
coherence and transparency of trade policies through surveillance in global economic policy-making. Another
priority of the WTO is the assistance of developing, least- developed and low-income countries in transition to
adjust to WTO rules and disciplines through technical cooperation and training.
The WTO is also a center of economic research and analysis: regular assessments of the global trade picture in
its annual publications and research reports on specific topics are produced by the organization. Finally, the
WTO cooperates closely with the two other components of the Bretton Woods system, the IMF and the World
Bank.
Principles of the trading system

The WTO establishes a framework for trade policies; it does not define or specify outcomes. That is, it is
concerned with setting the rules of the trade policy games. Five principles are of particular importance in
understanding both the pre-1994 GATT and the
WTO:
Non-discrimination. It has two major components: the most favored nation (MFN) rule, and the national
treatment policy. Both are embedded in the main WTO rules on goods, services, and intellectual property, but
their precise scope and nature differ across these areas. The MFN rule requires that a WTO member must
apply the same conditions on all trade with other WTO members, i.e. a WTO member has to grant the most

favorable conditions under which it allows trade in a certain product type to all other WTO members. "Grant
someone a special favor and you have to do the same for all other WTO members." National treatment means
that imported goods should be treated no less favorably than domestically produced goods (at least after the
foreign goods have entered the market) and was introduced to tackle non-tariff barriers to trade (e.g. technical
standards, security standards et al. discriminating against imported goods).
Reciprocity. It reflects both a desire to limit the scope of free-riding that may arise because of the MFN rule,
and a desire to obtain better access to foreign markets. A related point is that for a nation to negotiate, it is
necessary that the gain from doing so be greater than the gain available from unilateral liberalization;
reciprocal concessions intend to ensure that such gains will materialize.
Binding and enforceable commitments. The tariff commitments made by WTO members in a multilateral
trade negotiation and on accession are enumerated in a schedule (list) of concessions. These schedules
establish "ceiling bindings": a country can change its bindings, but only after negotiating with its trading
partners, which could mean compensating them for loss of trade. If satisfaction is not obtained, the
complaining country may invoke the WTO dispute settlement procedures.
Transparency. The WTO members are required to publish their trade regulations, to maintain institutions
allowing for the review of administrative decisions affecting trade, to respond to requests for information by
other members, and to notify changes in trade policies to the WTO. These internal transparency requirements
are supplemented and facilitated by periodic country- specific reports (trade policy reviews) through the Trade
Policy Review Mechanism (TPRM). The WTO system tries also to improve predictability and stability,
discouraging the use of quotas and other measures used to set limits on quantities of imports.
Safety valves. In specific circumstances, governments are able to restrict trade. The WTO's agreements permit
members to take measures to protect not only the environment but also public health, animal health and plant
health.
There are three types of provision in this direction:

articles allowing for the use of trade measures to attain non-economic objectives;
protection measures as a means of disguising protectionist policies.
Articles aimed at ensuring "fair competition"; members must not use environmental
Provisions permitting intervention in trade for economic reasons.
Exceptions to the MFN principle also allow for preferential treatment of developing countries, regional
free trade areas and customs unions.
GAT
The General Agreement on Trade in Services (GATS) is a treaty of the World Trade Organization (WTO) that
entered into force in January 1995 as a result of the Uruguay Round negotiations. The treaty was created to
extend the multilateral trading system to service sector, in the same way the General Agreement on Tariffs
and Trade (GATT) provides such a system for merchandise trade.
Services are covered by GATS?

GATS consider education as a tradable service. GATS covers 12 service sectors (Business; Communication;
Construction and Engineering; Distribution; Education; Environment; Financial; Health; Tourism and Travel;
Recreation, Cultural, and Sporting; Transport; "Other".). Two exceptions are services in the exercise of
governmental authority and air traffic rights
Laws are covered by GATS?

GATS apply to all measures affecting trade in services. GATS defines measures as all laws, regulations and
practices from national, regional or local government or non-governmental bodies exercising powers

delegated to them by government that may affect trade.
How can services be traded?

GATS define 4 ways that all services can be traded based on modes of supply:
1. Consumption abroad of service by consumers travelling to supplier country (e.g. Students studying
abroad);
2. Cross border supply of a service to consumer country without the supplier (e.g. open and distance
education);
3. Commercial presence of a supplier in consumer country (e.g. offshore foreign universities);
and
4. Presence of Natural Persons from supplying country in consuming country (e.g. professors,
researcher working outside their home country).
Rules does GATS have?

GATS have two broad categories of rules. The first category is general rules which apply, for the most part, to
trade in all services. The second category is rules applicable to national commitments in specific service
sectors.
Pre-requisites for Indian architects to work in other countries

The professional requirements for architects vary from place to place, but usually consist of three elements:
a university degree or advanced education, a period of internship or training in an office, and examination for
registration with a jurisdiction.
Professionals engaged in the design and supervision of construction projects prior to the late 19th century
were not necessarily trained in a separate architecture program in an academic setting. Instead, they usually
carried the title of Master Builder, or surveyor, after serving a number of years as an apprentice (such as Sir
Christopher Wren). The formal study of architecture in academic Institutions played a pivotal role in the
development of the profession as a whole, serving as a focal point for advances in architectural technology
and theory.
Professional requirements by country

Australia
In Australia, the title of architect is legally protected but architects are registered through state boards.
These boards are affiliated through the Architects Accreditation Council of Australia (AACA). The AACA's
Architect Registration service also provides accreditation for schools and assessments for architects with
overseas qualifications for the purposes of migration.
There are three key requirements for registration: a professional degree from a school of architecture
accredited by the AACA; at least two years of practical experience, and; the completion of the
architectural practice examination.
Architects may also belong to the Australian Institute of Architects (formerly the Royal Australian Institute
of Architects) which is the professional organization and members use the suffix AIA after their name.
Most States have legislation which covers the use of the title "architect" and makes it an offence for
abusers of the title. As this can vary, it is essential to check the relevant legislation applicable in each
State.
Canada
In Canada, architects are required to meet three common requirements for registration: education,

experience, and examination. Educational requirements generally consist of an M.Arch. Degree and are
certified by the Canadian Architectural Certification Board (CACB). For degreed candidates, the experience
requirement is typically the Intern Architect Program (IAP). The provincial associations of architects, by the
authority granted under their respective provincial Architects Act, require that Interns gain a minimum of
5,600 hours of work experience. The fundamental purpose of the pre-registration/licensing employment
period is to ensure that the Intern is provided with sufficient experience to meet the standards of practical
skill and level of competence required to engage in the practice of architecture. This experience is diversified
into four main categories and 16 sub-categories, and must be completed working under the direct supervision
of a registered architect. At present, all jurisdictions use the Architect Registration Examination (ARE), a series
of seven computerized exams administered by the National Council of Architectural Registration Boards
(NCARB). As well, all jurisdictions recognize the Examination for Architects in Canada (Ex AC), administered by
the Pan Canadian Ex AC Committee. Upon completion of the educational requirements, IAP, and
examinations, one can apply for registration/license with their respective provincial architectural institute. An
annual fee must be paid, and continuing education requirements met, in order to maintain a license to
practice.
The Royal Architectural Institute of Canada (RAIC) was established in 1907 and is a voluntary national
association representing more than 3,600 architects and Faculty and graduates of accredited Canadian Schools
of Architecture.[2] The RAIC aims to be "the voice of Architecture and its practice in Canada". Members are
permitted to use the suffix MRAIC after their names. The suffix FRAIC (Fellow of the RAIC) is used by members
of the RAIC College of Fellows. Not all members of the RAIC hold accredited degrees in architecture, and not
all Canadian architects are members of the RAIC.
India
For carrying professional practice in India, architects are required to register with Council of Architecture
which is constituted by the Government of India under the provisions of the Architects Act, 1972. The
profession of an architect is governed by the Architects Regulations, 1989 (as amended in 2003).
The COA registration service also provides accreditation for institutions providing the degree of architecture,
which is minimum five years duration including professional practice for 16 working weeks (one semester).
There are about 280 institutions including constituent colleges/departments of universities, deemed
universities, affiliated colleges/schools, IITs, NITs and autonomous institutions which impart architectural
education in India leading to recognized qualifications.
Ireland
The main body for Architecture in Ireland is the Royal Institute of Architects in Ireland, RIAI. Members may
use the affix MRIAI and are registered to use the title "Architect" in company stationery. The title has only
recently been protected.
To become a registered Architect, it usually takes five years' full-time study in the recognized schools of
Architecture, followed by a minimum of two years approved experience, and one of the recognized
Professional Practice qualifications to gain admission to the RIAI . In all, it takes a minimum of seven years to
gain registration. More details can be found on the RIAI website.
An alternate route to the Register is available through the ARAE (Architects Register Admission Examination)
this provides an opportunity for those without the required educational and professional qualifications to
enter the Register in Ireland. This examination has operated successfully since 2009.
Architects' Alliance of Ireland is a group of long-established self-trained architects created in response to Part
3 of the Building Control Act 2007. The Act seeks for the first time to control the use of the term 'architect' in
the Republic of Ireland. The group is lobbying for an amendment of the legislation in order to restore the

prior status of self-trained architects in the profession.
Italy
To enter the profession in Italy, individuals are required to first obtain a degree in Architecture, or a degree in
Building Engineering/ Architecture, then to receive professional qualification, obtained by passing a state
exam which consists of four tests (three written and one oral). To practice, the architect must register with
the Ordine degli architect (Order of Architects), which following a recent reform also includes planners,
landscape architects and conservationists (architectural heritage). The Orders are organized by province, and
registration is based on place of residence of the architect. Within the order there are currently several
classes and categories, depending on specific qualifications.
Italian law recognizes equal rights to Building engineers registered with the appropriate order. Other
professionals in the construction industry are the geometry (survey or ) and the perito industrial(technical
expert) specializing in construction; these professionals have several limitations compared to architects
and engineers, as they follow a different and shorter course of study aimed at learning basic and
complementary aspects of work in construction.
Mexico
In Mexico, every profession is regulated by the Secretariat of Public Education, including architecture. The
Secretariat expends a Professional License (in Spanish cdula professional), only after a recognized
undergraduate degree is successfully achieved. Therefore, it is legally sufficient for an architect to hold an
undergraduate diploma and a Professional License in order to practice. Registration to an official college or
association of architects is completely optional.
Nevertheless, there are other norms that regulate the building industry. In Mexico, as it is common for
constructions to be developed by individuals other than architects, these regulations are quite unrelated to
the architecture profession. For a major construction, it is necessary for a professional to act as a Director
Responsible of Construction (in Spanish, Director Responsible de Obra or DRO). This position does require a
minimum of two years of professional experience in construction, as well as further evaluation and/or
training. However, it is uncommon for architects to assume this role; this is generally a position preferred by
and reserved to civil engineers.
Singapore
In Singapore, university study is required (such as the five-year course of study at the National University of
Singapore or certain approved foreign universities). Upon completion of university, additional training by
working for a minimum of two years under a registered architect is required in order to become registered.
Singaporean law governs the use of the term "architect" and prescribes the requirements to be listed in the
Register of Architects. Membership in the Singapore Institute of Architects is a voluntary professional
credential.
South Africa
See also: List of architecture schools in South Africa
In South Africa, Architecture can be practiced in one of four categories, depending on qualification:
professional architect (Pr.Arch.), professional senior architectural technologist (Pr.S.Arch.T.), professional
technologist (Pr.Arch.T.), or professional draughts person (Pr.Arch.Draught.). After graduating, one enters a
two-year period of in service training as a "candidate", and sits a Professional Practice entrance examination;
one must also register with the South African Council for the Architectural Profession. When studied through a
University, the programme is structured in two parts: the first is a three-year course leading to a Bachelor of
Architectural Studies or BSc (Architecture); the second is an additional two-year postgraduate, professional
degree either the Bachelor of Architecture or Master of Architecture, depending on University which qualifies

one to become an architect. A student is able to exit university after obtaining the first degree, and will be able
to become a senior architectural technologist. When studied through a University of Technology (or a
comprehensive university), the courses in architecture are a three-year National Diploma, and, after an
additional year of study, the B.Tech degree. These enable a student to become an architectural technologist or
senior technologist, respectively. To become a draughts person, one requires a (two year) National Certificate.
The possibility of progression from one category to the next has been provided for in the Regulations, and is
under review.
Sri Lanka
Term "Architect" and "Chartered Architect" are protected titles in Sri Lanka under the Architects
Registration act of 1979 and the Sri Lanka Institute of Architects (Amendment) Act, No. 14 of 1996.
In Sri Lanka, architects are required to meet three common requirements for registration: education,
experience, and examination. The Education can be from one of the two available institutions; the degree
course held by University of Moratuwa or by the part-time course held by the City School of Architecture
(owned by the Sri Lanka institute of Architects) or by any foreign university recognized by the SLIA.
The University of Moratuwa has been offering a "3+2" program recognized by both
the SLIA and RIBA; a three-year B.Sc. (Built Environment) degree and a two-year masters, M. Sc.
(Architecture). This with the 2 years of appropriate work experience and successful completion of SLIA Part III
examination would lead to the charter and the Architectural Registration Board (ARB) registration.
Recently, the University of Moratuwa has changed the "3+2" program to a continuous five- year B.Arch.
program.
City School of Architecture offers a part-time course of seven years during which the students should be
working continuously under the supervision of a Chartered Architect while attending the school on a part-time
basis. Completion of the first four years of this program qualifies for SLIA part I and completion of the balance
after 3 years qualifies for SLIA part II. Successful completion of this program with the 1 year of appropriate
work experience and successful completion of SLIA Part III examination would lead to the charter and the
Architectural Registration Board (ARB) registration.
United Kingdom
In the United Kingdom, practicing under the name, style or title "architect" is restricted by law to those
registered at the Architects Registration Board. It usually takes a minimum of seven years to obtain the
necessary qualifications and experience for registration.
Those wishing to become registered must first study at a recognized university-level school of architecture.
Though there are some variations from university to university, the basic principle is that in order to qualify
as an architect a candidate must pass through three stages which are administered by the Royal Institute
of British Architects:
On completing an initial degree in architecture (usually three or four years, usually either a BA, BSc, or B.
Arch) the candidate receives exemption from RIBA Part I. There then follows a period of a minimum of one
year which the candidate spends in an architect's office gaining work experience.
The candidate must then complete a post-graduate university course, usually two years, to receive either
a graduate diploma (Dip Arch), Masters (M. Arch) or B(Arch). On completing that course, the candidate
receives exemption from Part II of the RIBA process.
The candidate must then spend a further period of at least one year gaining experience before being
allowed to take the RIBA Part III examination in Professional Practice and Management.
United States
In the United States, people wishing to become licensed architects are required to meet the requirements of

their respective state. Each state has a registration board to oversee that state's licensure laws. National
Council of Architectural Registration Boards is a non-profit professional association created in 1919 to help
ensure parity between the states' often conflicting rules. The registration boards of each of the 50 states (and
5 territories), member boards. NCARB issues a national certificate to qualified licensed architects. The NCARB
certificate is recognized in most licensing jurisdictions for the purpose of granting licensure by endorsement or
reciprocity.
Requirements vary among jurisdictions, and there are three common requirements for registration: education,
experience and examination. About half of the States require a professional degree from a school accredited
by the National Architectural Accrediting Board (NAAB) to satisfy their education requirement; this would be
either a B. Arch or M. Arch degree. The experience requirement for degreed candidates is typically the Intern
Development Program (IDP), a joint program of and the American Institute of Architects (AIA). IDP creates a
framework to identify for the intern architect base skills and core-competencies. The intern architect needs to
earn 700 training units (TUs) diversified into 16 categories; each TU is equivalent to 8 hours of experience
working under the direct supervision of a licensed Architect. The states that waive the degree requirement
typically require a full 10 years' experience in combination with the I.D.P diversification requirements before
the candidate is eligible to sit for the examination. California requires C-IDP (Comprehensive Intern
Development Program) which builds upon the seat time requirement of IDP with the need to document
learning having occurred. All jurisdictions use the Architect Registration Examination (ARE), a series of seven
(formerly nine) computerized exams administered by NCARB. The NCARB also has a certification for those
architects meeting NCARB's model standard: NAAB degree, IDP and ARE passage. This certificate facilitates
reciprocity between the member boards should an architect desire registration in a different jurisdiction. All
architects licensed by their respective states have professional status as Registered Architects (RA).
Depending on the policies of the registration board for the state in question, it is sometimes possible to
become licensed as an Architect in other ways: reciprocal licensure for over-seas architects and working
under an architect as an intern for an extended period of time. Length of the typical licensure process
depends on the particular combination of education, experience and pace of examination of a candidate. It is
typical that the entire licensure process takes at least 7 to 11 years to complete; including five years of study
(5 years for B. Arch, 3 years for M. Arch, 6 years for a "four-plus-two" program), three-plus years of
experience (meeting exact IDP requirements in each category), and often a year or more to take and pass the
seven ARE 4.0 exams.
Entry of foreign architects in India

Indian Architects keep foreign players out
After the tussle between local and foreign auditors and lawyers, it's now the turn of architects. The Council of
Architecture (CoA), the regulatory body for the profession, has stepped up its fight against foreign architects
practicing in India attracting severe criticism from several countries, including the US.
Although foreign architects are not allowed to practice in India, several entities were rendering services in the
country, either directly or through tie-ups with local players. A 1972 law explicitly prohibits any foreign firm
architect and the government, despite its keenness, has refused to open up the sector despite negotiations at
the World Trade Organization (WTO).
Last year, as reported first by TOI, the Delhi high court had ruled that the approval granted by the Foreign
Investment Promotion Board ( FIPB) to RSP Architects, Planners and Engineers, a Singapore-based firm, was
not in line with the law.
This provided fresh ammunition to the CoA, which recently issued a public notice saying "... no foreign
architect/consultant (not registered with CoA) be appointed for architectural works, without following the
procedure under the (Architects) Act". It said that it had issued the advertisement after it received
complaints about appointment of foreign architects, without prior approval of the government.

This largely went unnoticed in India but has evoked strong reaction from foreign lobby groups and architects,
which have raised a banner of protest and have gone to the extent of drawing parallels with the retrospective
amendments to tax laws. They have told Indian ministers that the issue once again highlights India's
unwillingness to open up its markets to foreign competition. Overseas architects are keen to tap into the
booming real estate and infrastructure sectors in India.
CoA president Uday C Gadkari could not be reached for comment but council member Inderjit Singh Bakshi
told TOI that the regulatory entity had taken up the issue with the government as "only those registered with
the council can practice in India". Apart from those with degrees from recognized Indian architecture schools,
the Architect's Act also recognizes qualifications from certain countries on a "reciprocal basis".
Government officials agreed with the CoA stance and said the law clearly bars foreign architects from
practicing in India. "It is not part of our commitment to WTO and can only be done if there is qualification
equivalence or mutual recognition," an official said. This means that architects from a foreign country can
be allowed to practice in India on a reciprocal basis if the professional qualifications are accepted or
architects from either country clear the stipulated professional tests. For this to happen, CoA and its
foreign counterpart have to come to an agreement.
While foreign lawyers are explicitly banned from practicing in India, the Institute
of Chartered Accountants of India has entered into mutual recognition agreements with its counterparts in
the UK, Canada and Australia for reciprocal membership arrangements.
Although the government has repeatedly tried to open up the professional services market to foreign players,
industry bodies have prevented it from going ahead, citing threat to livelihood. Despite the "ban" foreign
players have thrived with audit firms such as EY, KPMG and Deloitte taking over domestic firms. They have
used their brands to get business but use the local firms for signing off on accounts. In case of law firms,
several Indian players have tie-ups with overseas solicitors, who advise them but cannot appear in court.
Example current scenario

Foreign Architects in India
The profession and practice of architecture in India has undergone a complete transformation in this decade.
The last eight years have been a boom time, not seen since the heady days of Post Independence India.
The booming economy and the burgeoning middle class has prompted developers to bring in foreign
architects with foreign fees to design everything from airports to residential and office towers and bungalows
and resorts.
Foreign architects bring in the tried and tested processes and function precision to bring about a complete
turnaround in the way projects are designed and built. They pair up with Indian firms who have the expertise
on the ground to get things done and built.
Foreign architects for the most part are bringing in foreign solutions and design principles which may not all
work in India, but the public does not think a second before lapping it all up. We are literally bringing New
York, Chicago, Tokyo or Shanghai to Bombay, Delhi, Calcutta, Madras and countless other towns and cities.
Only time will tell if this is successful in the long term. India is not the only place in the world where this is
happening. China is way ahead of us in transplanting urban fabric from the West into their cities.
The TOI has an interesting article about the whole phenomenon of foreign architects coming to India. " Time
was when there was only the occasional eruption of concrete. Today, Indias skyline is a work in progress. But
while the towering new skyscrapers, sprawling IT parks, glitzy airports and swanky townships reflect desi

aspirations, the blueprint, more often than not, is foreign.
Be it a slum redevelopment project in congested Mumbai or Kolkatas new museum of modern art, the global
imprint on the countrys fast-changing urban landscape is evident. Made in India but designed by a clutch of
foreign architects looking to cash in on the countrys real estate boom. For Edinburgh-based RMJM, the
company behind the distinctive Scottish Parliament, a foray into India four years ago has translated into
business of 1 billion. That, the company says, is unprecedented for a UK architecture firm doing business in
India. Theres a cue here for UK business we need to be in India in a very big way, says RMJM CEO Peter
Morrison. RMJM, which currently has 38 projects under way in India, is now looking to establish a permanent
base in Mumbai.
Many others have taken the cue. Celebrated British architect Lord Norman Foster, who shaped Londons
skyline with buildings such as the Gherkin and designed the Reichstag in Berlin, has entered India in a tie-up
with a Mumbai real estate firm, the Neptune group. Other big UK names in India are Laing ORourke, Davis
Langdon and Mott MacDonald. Not just UK, firms from Canada (Arcop) to Australia (Omiros One) have designs
on India.
But does India really need foreign architects or is it just about getting a brand on the brochure? Most builders
agree its as much about star power as it is about international quality. After all, well-heeled buyers respond to
designers with international reputations as much as they respond to a luxury label like Gucci or Prada. When
people purchase an expensive apartment, a famous architect is extra validation theyre making a good
choice, says Kunal Banerji of Ansal API which signed up US firm Chelsea West to design Manhattan- style
condos at its Aqua polis project in Ghaziabad.
The Mahindra groups real estate arm Mahindra Life spaces, which has roped in US-based architect and
design firm HOK (of Dubai marina fame), says their reasons go much beyond the brand. The selection of an
international architect or planner is driven by the unique needs of the project. For instance, the 325-acre
Mahindra World City project is one of the largest such developments under implementation and to that
extent the width and depth of on-ground implementation experience is currently available only with
international firms who have conceived and implemented such projects in different parts of the world, says
Anita Arjundas, COO of Mahindra Life spaces.
Size does matter and with Indian developers going beyond stand-alone commercial blocks and residences to
converting huge swathes of land into townships and IT parks, a foreign hand does come in handy. Foreign
firms can visualize and handle massive scale. Also, their designs are very innovative. They create landmarks
and not just buildings, says Shantanu Malik, DGM-Architect, Unitech Ltd.
Its a win-win for Indian architects as well. Working with foreign firms gives us exposure to international
standards. There is a lot to learn from their use of detailing and modern materials, adds Malik.
Unitech often hires multiple design firms for a single project. For instance, it has 10 global architecture and
design consultants for the $3 billion Unitech Grande, a super-luxury residential complex spread over 347 acres
along the Noida expressway. This project draws on the expertise of US-based mall designer Callison, landscape
artists SWA and EDAW, Britains RMJM for architecture and interiors and HOK for floor plans, besides a course
designed by Australian golfer Greg Norman.
With so much demand, it isnt surprising that Mark Igou, director in the US architectural firm Skidmore,
Owings and Merrill Llp (SOM), has been shuttling between New York and India over the last three years. I
spend more than three months a year in India, familiarizing myself with the ground situation. And ground
reality is what SOM the firm which has designed the Burj Dubai, which will be the worlds tallest skyscraper
when it is finished in 2009 is faced with in Mumbai where it is designing homes for slum dwellers in
Mumbais Santa Cruz as part of a masterplan for Unitech. Its a unique design challenge recreating the

same sense of community that exists in their current housing so that people dont want to return to the slums
they left, says Igou. SOM is also using the services of sociologists and cultural anthropologists to get a sense
of the social and cultural aspects of the lives of those being rehabilitated.
Whether its slum housing or a swanky township, India is essential to the design inputs. Education and social
interaction are both important to Indians so our designs will reflect these needs. So residential units would
have schools nearby and public spaces for people to interact, he says. Besides projects like the Jet Airways
headquarters in Mumbai, SOM is also working in Tier-II cities like Ahmadabad and Nagpur.
Be it the Indian ethos or the vagaries of its climate, Uruguayan architect Carlos Ott keeps it in mind when he is
on the drawing board. Ott, who has designed a techno park for Tata Consultancy Services at Siruseri, Chennai,
in association with countryman Carlos Ponce de Leon, says, I am constantly studying the history and
traditions of India, hoping to integrate some of its characteristics in my buildings. And though my work is
definitely contemporary, the clues from the past are integrated in a modern vocabulary.
Ott is building on the work that earlier foreign architects have done in India. Apart from Lutyens and Le
Corbusier, several other international architects have showcased their designs in India. Ahmadabads Indian
Institute of Management reflects Louis Kahns trademark style of veering towards monolithic masses
resembling ancient ruins. Christopher Charles Benningerdesigned the Mahindra United World College of India,
near Pune. British- born Laurie Baker planned the Fishermens Village in Poonthura in Kerala, while American
Joseph Stein gave shape to Delhis India International Centre.
Now, a new generation of foreign architects has designs on India. And their glittering computer-generated
images look set to redefine the countrys skyline. "
Construction sounds boom loudly nowadays as the Indian skyline towers with competing skyscrapers and IT
office parks sprawling in outer suburban townships. More high-tech, high-glitz international airports replete
with all the commercial building associated with major transportation hubs have fulfilled many Indian
intended building goals but the design is often American inspired.
Design Demand Outpaces Local Delivery

The boom in India real estate development and redevelopment is outpacing the countrys ability to produce
enough native talent to keep up with the demand. Thus, when a country with a population of 1.2 billion
produces only 3,000-4,500 architects annually from its 180 schools according to the India Council of
Architecture, with an estimate of 40,000 registered professionals, the demand means an international search
for available talent.
Besides the enormous need for commercial building architecture, building expansion, and interior design
created by Indias real estate boom, the sustainable-designed buildings are also in public consideration due to
rising energy prices and changing government policies and tariff structure. Many new buildings in India are
LEED certified.
Still Made in India, But Designed Globally

From the redevelopment of Mumbai slums to the high-tech designs for a modern art museum in Kolkata,
architectural design in the Indian sub-continent has taken on a decided global appearance making a huge
impact upon the ever-changing urban landscape. Although this does translate into opportunities for
construction to remain Made in India, the design has been firmly grabbed by a bevy of foreign architects
including U.S.-based firmsseeking to capitalize on the countrys continuing real estate boom.
Is This Need Created?

This question can be rightly posed if India is, indeed, in need of so much foreign architect design activity. Or,

is it simply a matter about acquiring star power and the bragging rights associated with international
quality? We at Amritt believe that Indian real estate developers are seeking a modernized, updated function
and look to their properties, just as any clothing consumer would seek either Prada or Gucci as design
choices.
Therefore, world class implementation demands worldwide searches. Savvy, profit-seeking Western architects
are focusing effort on India.
Codes of conduct for Indian architects

A code of conduct is a set of rules that outlines the duties and responsibilities of a particular person, groups
or organization. All professions are bound by these codes, including architecture which is a process of
designing, planning and construction of buildings and other structures.
In India, just like other countries, architects do have codes of conduct. Indian architects are required to
register with a government body called the council of architecture so that one can be able to carry out the
professional practice. It is illegal to conduct any architectural activities without getting registered by this body.
When they register with this body each architect gets a unique registration number. They also have to follow
the Indians architects act 1972, which states the following.
All architects are to be bound by this act and are to follow it.
The council of architecture shall be the body responsible for all architects. Through this body
contracts can be made. One can sue or be sued.
The head office shall be in Delhi unless stated otherwise by the central government, which will be put in
the gazette.
Specifies the number of members who are to be on the council and there mode of election.
It talks about the registration of architects. That with them they should have their birth certificate,
national identification card, relevant school documents and a degree from a known institution.
Punishments to those who give false representation are also stated.
The Indian government also did establish a code of conduct in the Indian constitution. It is under the
professional code of conduct 1989. It states that:
Every architect who's either employed or practicing is subject to the provisions of the central civil
services.
An architect should make sure that his professional activities do not conflict with his responsibilities and
what he is entitled to do, his responsibility to the society and environment.
He or she should apply and use his skills responsibly for the economic development of India.
The architect shall provide professional services of high quality and to the best of his ability.
Should always inform the client on the conditions of engagement and the terms of agreement
especially if one is on private practice. These are to form the basis of an appointment.
One should not sub commission work to another or other architects without an agreement with his
client.
He should not give or take discounts, gifts, commissions or any form of inducement for introduction of a
client or work.
He should act with impartiality and fairness when administering a contract.
The architect should maintain very high standards of integrity.
Should promote the advancement of architecture, research, training, architectural education and
also training.
He should respect and recognize professional responsibilities of consultants.

QUESTIONS
Two Marks:
1. What do you understand by globalization in architectural practice?
2. Writes short notes on GATS?
Sixteen Marks:
1. What are the pre- requisites for Indian architects to work in other countries.
2. Explain the impact of information technology on architectural practice.
3. Explain the implications of foreign Architects entry in India.

UNIT V
EMERGING SPECIALISATIONS FOR AN ARCHITECT
Contents:
Definition
Introduction to Project Management
Evolution of Project Management
Todays Scenario - Fields in Project Management
Function of Project Management
Role of an Architect in Construction
Benefits in project management for architects
Lifecycle of Project Management
Process of Project Management
Others
Course Objective
Project:
What is a Project?
Projects are unique, transient endeavors undertaken to achieve a desired outcome.
The definition of a project identifies two of the key features:
Uniqueness
Projects are separate to business-as-usual activities, requiring people to come together temporarily to focus on
specific project objectives. As a result, effective teamwork is central to successful projects.
Transience:
A project has a specific start and end point and is set up to meet specific objectives, to create a
specified result, product or service.
What is project Management?

At its most fundamental, project management is about people getting things done.
Project management is the process by which projects are defined, planned, monitored, controlled and
delivered such that the agreed benefits are realized. Projects bring about change and project management is
recognized as the most efficient way of managing such change. (APM, 2011)
Project management focuses on controlling the introduction of the desired change. This
involves:
Understanding the needs of stakeholders.
Planning what needs to be done, when, by whom, and to what standards.
Building and motivating the team.
Coordinating the work of different people.
Monitoring work being done.
Managing any changes to the plan.
Delivering successful results
Evaluation of Project Management

It can be conjectured that the history of project management goes back to the time of the pharaohs
and the construction of pyramids of Giza or to the Qin dynasty and the Great of China

Contemporary project management has its roots in the 1950s and 1960s although Henry Gantt,
widely recognised as the father of planning and control techniques and his eponymous bar chart in the
early 1900s and Gantt Charts were used during World War 1 to reduce the build- time of cargo ship.
The concept of project management was after its introduction, mainly used by the construction industry
due to the temporary nature of its projects.
Two forefathers of project management are Henry Gantt, called the father of planning and control
techniques, who is famous for his use of the Gantt chart as a project management tool.
Todays Scenario Fields in Project Management:

With the advent of the new millennium, project management is increasingly seen as part of the general
management too and its techniques are deployed across all sectors of business and all types of project.
IT
Construction Industry
Retail
Healthcare
Mining
Function of Project Management:

A list of functions carried out by project managers:
Establishment of the clients objectives and priorities.

Design of the project organization structure.
Identification of the way in which the client is integrated into the project.
Advice on the selection and appointment of the contribution to the project and the
establishment of their teams of reference.
Translation of the clients objectives into a brief for the project team and its transmission.
Preparation of the programme for the project.
Activation of the framework of relationships established for the contributors.
Establishment of an appropriate information and communication structure.
Convening and chairing meetings of appropriate contributors at all stages.
Monitoring and controlling feasibility studies, design and production to ensure that the brief is being
satisfied, including adherence to the budget, investment and programme plans.
Contribution to primary and key decisions and to making operational decisions.
Recommendation and control of the implementation of a strategy for disposal or management of the
completed project, including commissioning the building and advising on arrangements for running and
maintaining it when completed.
Evaluation of the outcome of the project against its objectives and against interim reports including advice
on future strategies.
Role of an Architect in construction:

list of functions it is clear that the design manager (architect) and project manager are clearly different
roles, demanding quite different skills and abilities.
There are, however, overlaps between the project manager and architect, best accommodated by
integrating both disciplines within the same professional service firm There are, however, overlaps
between the project manager and architect, best accommodated by integrating both disciplines within the
same professional service firm
Collation of client/business requirements
Design co-ordination

Implementation.
Benefits in Project management for architects

Why should an architect understand project management?
Client/ stakeholders have an informed view of what the project will entail, at the onset. There are clearly
defined policies, objectives and instructions for every element of the project from start to finish.
Clients benefit from assigning the ultimate responsibility to the project manager.
An effective project manager is more likely to deliver the project successfully- i.e with good leadership, the
project is kept on track with respect to time, cost and quality.
Effective project management ensures effective risk management.
Effective project management ensures value for money.
Coordination is one key aspect of project management which is beneficial to the team as a
whole
A project manager with a sound knowledge of the relevant tools and techniques of PM is likely to
introduce change with maximum efficiency and effectiveness
In planning, monitoring and controlling a project, Project management focuses attention on cost, time,
quality/performance and their trade-offs in such a way as to effect optimum efficiency and effectiveness.
Need for project management in construction Industry

All the work that has to be done to achieve the time, cost and quality objectives defines the project
scope. The scope can change over time, and it is the project managers responsibility to ensure the
project will still deliver its defined benefits.
A project manager must maintain focus on the relative priorities of time, cost and quality.
Cost
Quality
Time
Process of Project Management:

A clinical Approach to Project Management:

1. Identify project objectives and constraints.
2. Maintain and update Risk register to capture
RISK project risks along with mitigation strategies.
3. Structural escalation matrix for high level risks.
1. An initiation schedule created to set the

momentum.
SCHEDULE 2. A combination of progress schedules tracked
closely to understand the current and planned
position.
1. Quality plan & safety plan document with target

parameters.
QUALITY & SAFETY 2. Periodic quality & safety reviews to review
compliance and minimum requirements
respectively.
1. Keep overall costs within approved project

budget by strictly monitoring expenditure.
COST 2. Conduct value engineering (VE0 workshops to
devise alternate methodologies to reduce costs.
3. Regular financial reporting through Prolog
Initiate:

Find out the requirements of the Client (objective of the client)

Understand the environment of the projects and the variables
Define the Scope of the Project, agree with the client etc
Plan:
Prepare a project Charter

Develop a Project Management Plan
Create a Work Breakdown Structure
Resource Allocation
Things to Consider while Planning Projects
Resource Availability
Health and Safety of Personnel the Workplace
Environmental Safety
Reduction of Time
Minimization of Cost
1.Execute:
Implementation of project plan with the agreed cost, time and quality.
Change management, cost management etc.
2.Monitor and Control

Schedule
Risk management
3. Closing Process
Handover of the project with achieved objectives & deliverables e.g commercial & technical
handover.
Who is a good Project management?
Leadership skills
Motivation skills
Decision maker
Teambuilding
Forecast and plan
Manage risk
Effective control of resources.
Indian project management companies in the market

DTZ
CBRE
JLL
Turner & Townsend
Design & Build firms.
Cushman & Wakefield
Project management school in India:

NICMAR

Tools and techniques

Project management Softwares ( Primavera, Microsoft project plan, pert master
etc )
Templates for individual deliverables ( 5 phases of the project)
Regular Meetings
Why this Subject? (objective)
To understand Traditional Management System Grant chart, Bar Chart, PERT, CPM, WBS etc
Skills soft & hard skills
Programming, Network Techniques
To Establish a relationship between Project Cost and Project Planning
Application of Softwares in Planning of Simple Projects.

QUESTIONS
Two Marks:
1. What do you understand by a dummy activity?
2. Mention any four rules to be followed for drawing a network diagram.
Sixteen Marks:
1. Explain and analyze the role, function and responsibilities of a construction manager and a project
manager.
2. Explain the planning, scheduling and controlling phases of a project management.
..

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Professional Practice and Ethics II AR 2501

Essential qualities of a good tender:

Components of a tender: A checklist.

Ar. Stanley clement Daniel 1

Different methods of calling tenders:

Ar. Stanley clement Daniel 2

Papers that are included in a Tender document.

2. General Conditions and Special Requirements of the Work:

3. Specifications of Work and Materials

Ar. Stanley clement Daniel 3

6. Articles of Agreement & general Conditions of Contract

Procedure of calling tender:

Earnest Money Deposit:

A note on Earnest Money Deposit:

Ar. Stanley clement Daniel 4

Instruction on the Cover Page

Receiving of Filled in Tenders

Ar. Stanley clement Daniel 5

(v) Comparative statement:

Scrutiny report of tenders

On writing a scrutiny report

Ar. Stanley clement Daniel 6

Ar. Stanley clement Daniel 7

A tender offer becomes ineffective

1. Time period of the Tender Offer

2. Counter offer by owner

Ar. Stanley clement Daniel 8

Ar. Stanley clement Daniel 9

Ar. Stanley clement Daniel 10

Sr. No Elements Pertaining building contract

3. Contract to be Signed by a Competent person

Ar. Stanley clement Daniel 11

By free will and Consent

Ar. Stanley clement Daniel 12

Indian Stamp Act of 1899

A contract document shall consist of the following papers:-

Ar. Stanley clement Daniel 13

Before Signing of Contract

Appendix in general conditions of contract

Owners consulting engineers

Ar. Stanley clement Daniel 14

DIFFERENT TYPES OF CONTRACT

1. Item Rate Tender / Contract

2. Lump Sum Tender and Contract

Essential Points to be Observed White Calling a Lump Sum Tender

Ar. Stanley clement Daniel 15

3. Plumping and Sanitary fittings

Uncertain items of work

Work below ground level

Ar. Stanley clement Daniel 16

As per code of council

Architect as construction manager

Study of contract document

Ar. Stanley clement Daniel 17

Basic Rates of Material and Escalation of Prices (refe3r Appendix 14 II)

Ar. Stanley clement Daniel 18

The printed booklet consists of:

Ar. Stanley clement Daniel 19

Defects Liability Period

Period of Final Measurement and Valuation

Ar. Stanley clement Daniel 20

Agreed Liquidated Damages

Value of Work for Interim Certificate