We regularly advise Main Contractors and Sub-Contractors in drafting and negotiating Sub-Contracts.
Each of the main standard form contracts include a sub-contractor agreement, enabling parties to avoid having to draft from scratch. However, as always, these standard form contracts ought to be amended to reflect the bargain between the parties in the context of the project. Unamended standard form contracts, by their nature, often favour one party over the other, another reason to ensure that suitable amendments are agreed to rebalance the position.
For example, Main Contractors ought to consider issues such as having sufficient time to provide notice to an Employer of an event, such as Delay, so that the Main Contractor has time to comply with the main construction contract provisions once notified of the event by the Sub-Contractor. The same principles applies to the Sub-Contractor exercising of rights under the Sub-Contract, enabling the Main Contractor sufficient time to exercise the mirroring provisions in the main construction contract.
For the Sub-Contractor, a key issue will be ensuring that there is a fair distribution of risk and liability – that the Main Contractor is not passing all the risk down the. We often advise Sub-Contractors who have signed a Sub-Contract without understanding the consequences in respect of risk, payment and other important provisions. Even if a contract is difficult to negotiate, understanding what you are signing up to enables Sub-Contractors to price effectively.
Our experienced team advises both Main Contractors and Sub-Contractors on their sub-contracting arrangements. Get in touch if you have any questions regarding your specific situation.