An architect is a person who plans, designs, and oversees the construction of buildings. To practice architecture means to provide services in connection with the design of buildings and the space within the site surrounding the buildings that have human occupancy or use as their principal purpose. Etymologically, the term architect derives from the Latinarchitectus, which derives from the Greek, i.e., chief builder.
Adjudication is the legal process by which an arbiter or judge reviews evidence and argumentation, including legal reasoning set forth by opposing parties or litigants, to come to a decision which determines rights and obligations between the parties involved.
Construction is a general term meaning the art and science of forming objects, systems, or organizations. It comes from the Latin word constructio and Old French construction. To 'construct' is a verb: the act of building, and the noun is construction: how something is built or the nature of its structure.
A subcontractor is a person or business that undertakes to perform part or all of the obligations of another's contract.
A performance bond, also known as a contract bond, is a surety bond issued by an insurance company or a bank to guarantee satisfactory completion of a project by a contractor. The term is also used to denote a collateral deposit of good faith money, intended to secure a futures contract, commonly known as margin.
A mechanic's lien is a security interest in the title to property for the benefit of those who have supplied labor or materials that improve the property. The lien exists for both real property and personal property. In the realm of real property, it is called by various names, including, generically, construction lien. The term "lien" comes from a French root, with a meaning similar to link, which is itself ultimately descended from the Latin ligamen, meaning "bond" and ligare, meaning "to bind". Mechanic's liens on property in the United States date from the 18th century.
In finance, a surety, surety bond or guaranty involves a promise by one party to assume responsibility for the debt obligation of a borrower if that borrower defaults. Usually, a surety bond or surety is a promise by a surety or guarantor to pay one party a certain amount if a second party fails to meet some obligation, such as fulfilling the terms of a contract. The surety bond protects the obligee against losses resulting from the principal's failure to meet the obligation. The person or company providing the promise is also known as a "surety" or as a "guarantor".
A general contractor, main contractor, prime contractor, builder (UK/AUS), or contractor is responsible for the day-to-day oversight of a construction site, management of vendors and trades, and the communication of information to all involved parties throughout the course of a building project. In the USA a builder may be a sole proprietor managing a project and performing labor or carpentry work, have a small staff, or may be a very large company managing billion dollar projects. Some builders build new homes, some are remodelers, some are developers.
Construction management (CM) aims to control the quality of a project's scope, time, and cost to maximize the project owner's satisfaction. It uses project management techniques and software to oversee the planning, design, construction and closeout of a construction project safely, on time, on budget and within specifications.
Project finance is the long-term financing of infrastructure and industrial projects based upon the projected cash flows of the project rather than the balance sheets of its sponsors. Usually, a project financing structure involves a number of equity investors, known as 'sponsors', and a 'syndicate' of banks or other lending institutions that provide loans to the operation. They are most commonly non-recourse loans, which are secured by the project assets and paid entirely from project cash flow, rather than from the general assets or creditworthiness of the project sponsors, a decision in part supported by financial modeling; see Project finance model. The financing is typically secured by all of the project assets, including the revenue-producing contracts. Project lenders are given a lien on all of these assets and are able to assume control of a project if the project company has difficulties complying with the loan terms.
Security of Payment refers to any system designed to ensure that contractors and sub-contractors are paid even in case of dispute. This can involve a system of progress payments, interim arbitration decisions, or a system which legally requires a company to pay an invoice within a set number of days, regardless of whether the company believes they are accurate.
The Joint Contracts Tribunal, also known as the JCT, produces standard forms of contract for construction, guidance notes and other standard documentation for use in the construction industry in the United Kingdom. From its establishment in 1931, JCT has expanded the number of contributing organisations. Following recommendations in the 1994 Latham Report, the current operational structure comprises seven members who approve and authorise publications. In 1998 the JCT became a limited company.
The New Engineering Contract (NEC), or NEC Engineering and Construction Contract, is a formalised system created by the UK Institution of Civil Engineers that guides the drafting of documents on civil engineering, construction and maintenance projects for the purpose of obtaining tenders, awarding and administering contracts. The NEC contract is widely used in the United Kingdom. There have been attempts, largely unsuccessful, to introduce the NEC contract into both Australia and New Zealand from at least 1994 but the contract remains relatively obscure in both countries.
The Miller Act requires prime contractors on some government construction contracts to post bonds guaranteeing both the performance of their contractual duties and the payment of their subcontractors and material suppliers.
A "Little Miller Act" is a U.S. state statute, based upon the federal Miller Act, that requires prime contractors on state construction projects to post bonds guaranteeing the performance of their contractual duties and/or the payment of their subcontractors and material suppliers.
The Construction Management Association of America (CMAA) is a non-profit and non-governmental, professional association serving the construction management industry. The Association was formed in 1982. Current membership is more than 14,000, including individual CM/PM practitioners, corporate members, and construction owners in both public and private sectors, along with academic and associate members. CMAA has 29 regional chapters.
Retainage is a portion of the agreed upon contract price deliberately withheld until the work is complete to assure that contractor or subcontractor will satisfy its obligations and complete a construction project. A retention is money withheld by one party in a contract to act as security against incomplete or defective works. They have their origin in the British construction industry Railway Mania of the 1840s but are now common across the industry, featuring in the majority of construction contracts. A typical retention rate is 5% of which half is released at completion and half at the end of the defects liability period. There has been criticism of the practice for leading to uncertainty on payment dates, increasing tensions between parties and putting monies at risk in cases of insolvency. There have been several proposals to replace the practice with alternative systems.
Vincent Powell-Smith was a British barrister, professor of law and legal author. He also wrote under the pen names Justiciar and Francis Elphinstone.
The CIOB Complex Projects Contract2013 was a form of construction and engineering contract, developed by the Chartered Institute of Building (CIOB). Its formal name was the 'Contract for Use with Complex Projects, First Edition 2013'.
A construction contract is a mutual or legally binding agreement between two parties based on policies and conditions recorded in document form. The two parties involved are one or more property owners and one or more contractors. The owner, often referred to as the 'employer' or the 'client', has full authority to decide what type of contract should be used for a specific development to be constructed and to set out the legally-binding terms and conditions in a contractual agreement. A construction contract is an important document as it outlines the scope of work, risks, duration, duties, deliverables and legal rights of both the contractor and the owner.
