A subcontract is a type of construction contract . In accordance with it, the general contractor entrusts the subcontractor with the execution of the agreed scope of work. The conclusion of such contracts helps to optimize construction work and reduce the time for their implementation.
After the subcontractor performs the work, the customer (general contractor) checks their completeness and quality in accordance with the conditions, after which, in the absence of complaints, he pays.
As a rule, subcontractors are required to carry out such works as finishing, communication, design, construction and some others.
A subcontract for a certain type of work is concluded by the parties in writing (simple) form. The right to conclude such agreements is granted to the general contractor by the main customer of the work.
A subcontract agreement, a sample of which can be taken from the accounting department of a construction company or downloaded from a network of a standard document, contains a number of required details. When drafting such an agreement, the following data should be indicated.
First of all, the types of work, their cost and deadlines are prescribed. These points must be indicated with maximum accuracy, because the result of the final work and the possibility of delivery of the object within the time agreed by the customer may depend on their implementation. In the event of a conflict, one can defend one’s interests in court only taking into account the conditions specified in the contract. No verbal agreements in contentious situations will be able to influence the resolution of the conflict.
The subcontracting agreement defines the obligations of the subcontractor in full. According to the document, he is obliged to start execution of work immediately after the general contractor provides him with a written request with a clear indication of the scope of work and the place of their implementation. The subcontractor undertakes to perform work at an appropriate level of quality, to deliver them on time, and also, if necessary, to correct all identified deficiencies exactly at the time established by agreement of the parties.
The general contractor is obliged to provide complete information about the type of work being carried out and their facility to the subcontractor, in time (usually three days) to check the quality of the work submitted to him and, if a defect is found, discuss the procedure for its elimination, and pay for the work according to the terms of the contract. The general contractor has the full right to verify the work in progress.
In turn, the subcontractor has the right to use its materials and tools in the performance of work and involve third parties in the execution. If the general contractor has not fulfilled his obligations to pay for the work on time, he can recover the existing debt or demand penalties for delaying this payment.
The subcontractor is obliged to perform all the work provided for in the design and estimate documentation, to also individually test them, test the installed systems and equipment, eliminate the deficiencies identified during the acceptance of the work by the general contractor.
You can terminate the subcontract agreement by mutual agreement of the parties, having drawn up the corresponding agreement. In addition, termination is possible through a court if the parties cannot reach agreement. The initiator of termination must act in accordance with the claims procedure for the settlement of disputes. Similar conflicts can be resolved in pre-trial procedure, for example, by paying a fine for late payment, inappropriate quality of work, etc.
Any failure to comply with the terms of the contract is a violation of discipline, which may entail property liability of both the subcontractor and the general contractor, if they are guilty of such a violation.