BUSINESS AND TRAINING
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The employer would choose a nominated subcontractor based on technical , managerial , and financial competence . The principal contractor is not involved – but may , after appointment , question the employer ’ s choice – and object to such appointment if he can substantiate that the chosen subcontractor ’ s work elsewhere was poor , delayed or that insufficient capital or other resources for a project of this nature are available . Obviously , one must be wary of fake malignments to secure the work for the contractor ’ s friends .
The employer can heed such advice if he believes it to be valid or instruct ( through the principal agent ) the contractor to proceed with the appointment . The advantage of an early appointment of a nominated subcontractor is to explore the best ‘ plumbing solution ’ contemporarily with the evolution of the other aspects of the design . Waiting to appoint a selected subcontractor after appointment of the principal contractor may result in late design changes or even delays . All of this makes sense where ‘ design ’ is involved but is less important if it is an installation-only contract .
Some employers ( and consultants ) are of the opinion that ‘ nominated ’ subcontractors are a nuisance to administer and prefer ‘ selected ’ subcontractors chosen in consultation with the principal contractor after appointment .
What is the difference ? The appointment of the subcontractor uses the same JBCC Nominated / Selected Subcontract Agreement issued by the principal contractor to the subcontractor for signature .
The principal differences are that :
• The contractor chooses a selected subcontractor based on technical , managerial , and financial competence . The employer is not involved – and may not question such appointment .
• The principal contractor is responsible for the execution of the works by all subcontractors under his control including nominated , selected , and domestic subcontractors .
If the nominated subcontractor fails to proceed with the works with due diligence , the principal contractor must issue a warning to the subcontractor to catch up and make good within a stipulated period , failing which its appointment may be terminated . Such notice must be copied to the employer and the principal agent for information . Should the subcontractor fail to comply , the principal agent must issue a contract instruction to the contractor to terminate the subcontractor ’ s appointment . Should the nominated subcontractor delay the works after following the notice procedures , the principal contractor may be entitled to an extension of time . Termination of a ‘ design subcontractor ’ during the installation phase may require careful negotiations as the design may be subject to copyright unless ceded to the employer as part of the initial appointment .
However , should a selected subcontractor delay the works after following the notice procedures , the principal contractor will not be entitled to an extension of time .
The employer / consultant team must decide how to procure services and products that best suit the project . There is not one ‘ right ’ solution that fits all applications . PA
July 2023 Volume 29 I Number 5 www . plumbingafrica . co . za