Contrary to what many contractors assume , there is no provision in most building |
a given point . These are usually prepared monthly by no later than a specified date and repeated every month until the final |
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contracts that would legally permit the contractor to suspend work if the employer fails to pay by the due date , nor are there contractual rights to remove materials and goods from site , says Uwe Putlitz , CEO of the Joint Building Contracts Committee ( JBCC ).
JBCC is a non-profit company that represents building owners and developers , professional consultants , as well as general and specialist contractors , who all provide input for the compilation of JBCC agreements that portray the consensus view of the committee ’ s constituent members .
Putlitz says if the contractor is not paid on time , he or she would need to compel the defaulting employer to honour the contract , or seek other methods of obtaining payment . “ The contractor could , for example , offer the employer payment terms and , should the employer still not pay , the contractor could then
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payment . The valuations should represent the total amount of work carried out to date , including unfixed materials and goods procured by the contractor , less any amounts previously certified .
“ While the obligation to prepare the valuation and issue the certificate rests with the principal agent , the contractor is required to assist him or her to determine the valuation by preparing and supplying a claim for payment incorporating measurements and valuations based on the bill of quantities of duly completed work , as well as materials and goods , together with relevant documents , such as invoices .
“ The valuation should incorporate the cost of work done by the subcontractors and include materials and goods supplied by them . This payment method is used in commercial and larger residential or commercial type projects ,” Putlitz explains .
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JBCC |
have the contract cancelled and sue the employer for damages .”
Putlitz says contract payments basically fall into two categories , namely interim payments and progress payments .
INTERIM PAYMENTS
These are based on valuations prepared
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PROGRESS PAYMENTS
Based on predetermined milestones , these are payments for work completed or progress achieved . For example , when the surface bed has been cast , or the roof has been installed , the contractor would then be paid the amount that was stipulated
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There is no provision in most building contracts that would legally permit the contractor to suspend work if the employer fails to pay by the due date .
payment method is used where no bills of quantities have been used and is mainly employed for smaller type projects .
Putlitz adds , “ The employer is obliged to pay the amount certified , or pay
within a reasonable time , usually seven calendar days from the date of issue of the certificate , or the contractor providing the employer with an invoice for the amount certified or for the amount of the
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by the principal agent for work done at |
in the contract schedules . This type of |