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BUSINESS AND TRAINING
The role players of a project( Part 2)
By Uwe Putlitz
Uwe Putlitz is a registered professional Architect and Construction Project Manager, a Fellow of the Royal Institute of Chartered Surveyors( RICS) and is a visiting lecturer at the School of Construction Economics and Management at the University of the Witwatersrand. Having recently retired as the Chief Executive Officer of the Joint Building Contracts Committee( JBCC) he specialises in the avoidance of construction disputes by way of lectures, technical articles dealing with aspects of contract administration for various industry publications arising from the use of Standardform Contracts including the Federation Internationale des Ingenieurs-Conseils( FIDIC), the General Conditions of Contract( GCC), the JBCC or the New Engineering Contract( NEC) to find an acceptable settlement without resorting to legal processes, where possible.
More info: info @ buildstrat. co. za
Here, we look at the different role players in construction projects, as well as the roles they play.
Projects, by their very nature, require numerous people with unique skills and access to specialised equipment – during each of the implementation phases – to contribute their expertise in compliance with statutory requirements and / or recognised( international) standards. This is part two in a multiple-part series.
Guarantors fall into two categories – those that provide an amount of money up to an agreed maximum amount to fix a contractual breach after other remedies have failed, and those who pay an agreed amount to an agreed maximum to repair damage.
Guarantees are generally issued by financial institutions and insurers but can also be issued between companies within the same holding company. In the construction industry, the builder is required to provide a performance guarantee to the owner( employer) at the start of the contract – the owner can call on the guarantor to make payment if the builder has failed to deliver the specified quality product on time. The wording of many guarantee forms appears to have been copied within the industry without the necessary editing to be compatible with changing practices, traditionally requiring the original hardcopy copy guarantee form with a wet signature to be presented within a stipulated period to the guarantor for a claim to be valid.
The industry offers a variety of guarantees:
• Bid bonds / guarantees
• Performance guarantees
• Advanced payment guarantees
• Materials off-site and on-site guarantees
• Retention / defects liability guarantees
• Supply guarantees
• Utility guarantees
As with any form of contract, the parties’ respective obligations must be adhered to for a guarantee claim to be enforceable. The interpretation of the wording and the processes have been the source of many legal arguments over the years. The issue of a guarantee requires a deposit of an amount of money with the guarantor determined by the perceived risk of the builder defaulting. Due to abuse by some owners lodging unsubstantiated claims against the builder, many builders prefer withholding retention at 10 % in regular payment claims until 5 % of the contract sum is reached. Half of the retention amount is repaid on practical completion and the remainder as part of the final payment after the final account has been agreed.
Recently, many guarantors have redesigned the process to be a secure electronic transaction with cleaned-up wording.
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www. plumbingafrica. co. za @ plumbingonline @ plumbingonline @ PlumbingAfricaOnline November 2026 Volume 32 I Number 09