Lump sum contract Definition

GLOSSARY

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What does Lump sum contract mean?

Contract under which the contractor agrees to carry out the works for a specific sum (subject to variations and, if applicable, fluctuations)—ie on a fixed price basis.

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FIDIC contracts—introduction to the Silver Book 2017, reprinted 2022 with amendments

FIDIC contracts—introduction to the Silver Book 2017, reprinted 2022 with amendments In December 2017, FIDIC launched the second editions of the Red, Yellow and Silver Books. Three years later, in December 2022, FIDIC launched reprints. The FIDIC Silver Book 2022 reprint is to be described as ‘The Conditions of Contract for EPC/Turnkey Projects Second Edition 2017, reprinted 2022 with amendments’. It is published with the same ISBN number. The amendments include: • the errata issued in December 2018 (see News Analysis: Errata to FIDIC 2017 contracts published) • the additional errata issued in June 2019, and • further errata and new amendments made in November 2022 (and said to be effective from 1 January 2023) which FIDIC describe as ‘improvements & clarifications in response to industry feedback + to support the increased use of 2017 contracts' There is no obligation to use the FIDIC 2022 reprints. The Parties are free to choose the original FIDIC 2017 books if they prefer. This Practice Note is an introduction to the FIDIC Silver...

Waste to energy infrastructure projects—an introduction

Waste to energy infrastructure projects—an introduction Historically, the main treatment route for waste in the UK has been landfill, primarily due to the availability of suitable sites created by past mineral extraction. However, since the mid-1990s, use of landfill sites has been changing, as the potential impact of waste management on climate change has become recognised and legislation has made landfill less attractive. These developments have, in turn, helped drive the development of waste to energy plants, which is about taking waste and turning it into a usable form of energy. This waste to energy can include energy outputs such as electricity, heat and commodities such as transport fuels or natural gas. Many plants are now being built with energy generation, in addition to waste management, being a key part of their function. Each year the UK produces 22 tonnes of municipal (ie from households, retail etc) solid waste and 47 tonnes from business. Over time, increasing amounts of waste have been processed at Energy from...

Discover our 35 Practice Notes on Lump sum contract

Please can you explain what 'with quantities', 'without quantities' and 'approximate quantities' mean?

Please can you explain what 'with quantities', 'without quantities' and 'approximate quantities' mean? It is common to come across the phrases 'with quantities', 'without quantities' and 'approximate quantities' in relation to construction contracts. These terms relate to the way that the works have been priced. For example, the JCT Standard Building Contract is published in With Quantities, Without Quantities and Approximate Quantities versions. Which description is correct (and therefore which form of contract is appropriate if using the JCT Standard Building Contract) will depend on whether or not there is an accurate bill of quantities available at the outset. Where the contract is described as being 'with quantities' it means that the employer provides the contractor with a detailed bill of quantities, ie a list which defines the quantity and quality of the work required (usually together with drawings). This list is prepared by the quantity surveyor and is provided to the contractor as part of the tender documents. The contractor can then price each item in...

If a party terminates a contract (relying on a contractual right to terminate for non-breach) is that party released from all payment obligations if the obligation to make payment has not yet accrued at the time of termination or does that party have any liability to pay for services which were provided prior to termination?

If a party terminates a contract (relying on a contractual right to terminate for non-breach) is that party released from all payment obligations if the obligation to make payment has not yet accrued at the time of termination or does that party have any liability to pay for services which were provided prior to termination? If the contract is not specific on this point, the case of Marks & Spencer plc v Paribas Security Services Trust Co (Jersey) Ltd shows the difficulty of arguing that there will be any implied term in these circumstances that the promisee will pay for such services. There the tenant exercised a break clause terminating the tenancy in the middle of a quarter but paid rent for the whole quarter. The court refused to imply a term that the rent should be apportioned. Although the court was strongly influenced by the fact that it was well-known, that rent paid in advance could not be apportioned under the Apportionment Act 1870 (AA 1870), the...

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Keep an eye on defective service and make swift jurisdiction challenges (Simon Bain Building Services Ltd v (1) Cardone, (2) O’Keefe)

Dispute Resolution analysis: This case deals with make-or-break procedural matters at the outset of a claim. The issues considered involve defective service of the claim form, and the applications that followed, ie seeking to contest jurisdiction under CPR 11 (though doing so out of time) and seeking to set aside default judgment under CPR 13. The case also examines limitation issues in a contract for services and the losses that can be claimed where the limitation date falls within the latter stages of a project. The claim form was deemed to not be adequately served where it was sent directly to the defendants rather than their solicitors who, although no longer acting, had previously agreed to accept service. The court also determined the outcome of applications under CPR 13 to set aside a default judgment, ultimately finding that the defendants had a reasonable prospect of successfully defending the claim looking at limitation issues and the substantive merits. An application under CPR 11 relating to the defective service was not made...

Court considers requirements of HGCRA 1996, ss 109–110 (JSM Construction v Western Power Distribution)

Construction analysis: The Technology and Construction Court (TCC) refused to strike out the claimant’s claim, or give summary judgment against it, in a case that raised the issue of whether the claimant had been entitled to issue an invoice for its final account. The defendant argued that the claimant was bound to fail in its claim that, because the parties’ contract contained no final account regime, the contract did not provide an adequate payment mechanism as required by Housing Grants, Construction and Regeneration Act 1996 (HGCRA 1996), and a provision for final payment was therefore imported from the Scheme for Construction Contracts. However, the court considered that the adequacy of the payment mechanism was a fact-sensitive issue, on which it could not reach a conclusion at this stage.

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