Construction Contract Review and Advice in Brisbane, QLD and Australia

A review of a Construction Contract examines the proposed agreement before it is signed, or, in some cases, after it is signed. Construction Contract Reviews identify obligations, liabilities and risk allocation, recommend amendments and help your business decide whether to accept the contract terms, negotiate further or decline the work.

What Is a Construction Contract Review?

A Contract Review involves examining a proposed agreement before you sign it or submit a tender response. The reviewer reads the documents together, identifies obligations and potential liabilities, and considers how risk has been allocated between the parties.

The advice separates provisions that can be accepted from provisions that need revision. It also identifies any risk that would remain if your business proceeds, so the owner, Board or authorised Delegate can make the final decision.

Do I Need a Contract Review?

You are more likely to need advice where a project has a high value, low margin, long delivery period or significant liability exposure. Advice is also useful where Special Conditions substantially amend an Australian Standard, the proposed terms differ from your tender response, or your Project Team has not worked under similar obligations before.

Payment periods, set-off rights and security can place pressure on cash flow. Variation procedures and short time bars can prevent recovery of additional time or money. Design obligations, indemnities, Liquidated Damages and uninsured liabilities can affect whether the work remains commercially acceptable. These provisions can also lead to payment, scope, delay and final account disputes during delivery.

When Should I Have My Contract Reviewed?

Seek advice before submitting a tender response if the proposed terms affect price, scope, program, methodology or resources. This gives your business an opportunity to qualify its offer, price accepted risk and propose departures before the commercial position is settled.

A further check may be required after negotiations and before signing. That check confirms whether agreed departures and amendments appear correctly in the execution version. Tender qualifications and assumptions also need to be incorporated if the parties intend them to form part of the final agreement.

Who Should Review the Construction Contract?

A front-end Construction Lawyer considers legal rights, obligations, liabilities, remedies and enforceability. The lawyer can recommend amendments and prepare replacement drafting. A Commercial Manager considers how the proposed position may affect price, margin, cash flow, resources, administration and delivery.

The Project Team needs to confirm that the scope, program, access requirements and reporting obligations can be met. The Estimating Team needs to confirm that accepted risk has been priced. Your Insurance Broker can advise whether key liabilities are insured, excluded or subject to a policy limit.

The person responsible for the review needs to bring those inputs together before the owner, Board or authorised Delegate makes the final decision. Separate comments from several advisers are less useful if nobody checks whether their recommendations are consistent.

What Documents Should I Send for Review?

For most clients, we review the full set of documents, including:

• the Formal Instrument of Agreement;

• General Conditions and Special Conditions;

• completed schedules and annexures;

• the Scope of Works, Statement of Requirements, specifications and relevant drawings;

• program, milestone and pricing documents;

• the tender response, qualifications, assumptions and exclusions;

• Statements of Departures, addenda and tender clarifications; and

• relevant correspondence recording discussions or agreements with the Principal or Client.

Guarantees, deeds, warranties, security forms, Principal policies and management plans may also contain binding obligations. Sending the full document set allows inconsistent provisions and document-precedence issues to be considered.

Which Contract Terms and Risks Need to Be Considered?

The provisions requiring attention depend on the project and proposed allocation of risk. A thorough review commonly considers:

• scope boundaries, exclusions, design responsibility and fitness for purpose;

• Contract Price, payment, set-off, security and retention;

• Variations, notice requirements and time bars;

• the Date for Practical Completion, delay, Extensions of Time and Liquidated Damages;

• indemnities, liability caps, consequential loss and insurance;

• warranties, defects, suspension and termination;

• dispute resolution and Security of Payment rights; and

• Head Contract obligations that may need to flow down to Subcontracts.

Small businesses may also need advice about the laws governing unfair terms in standard form contracts. An unfavourable provision does not always mean the business needs to decline the work. Your business may decide to amend, qualify, price, insure, manage or accept the risk.

We regularly see contracts where the main financial exposure does not sit in one obviously onerous clause. Payment, Variation, notice and delay provisions can operate together so that the contractor performs additional work but cannot recover the related time or cost. Reading each provision separately can miss that combined effect.

How Does the Review Process Work?

1. You send the documents

You send the available documents and tell us the tender or signing deadline. You also identify any prior negotiations and the concerns already raised by your Legal, Commercial, Estimating or Project Teams.

2. We confirm what you need

Rachelle checks what you send and discusses what you need. She asks about the Project, the other contracting party, your tendered price and scope, previous negotiations, your usual risk position and the person who will use her advice. We then confirm the format, scope, turnaround and price.

3. We assess the proposed position

We read the documents together and compare them with your tendered scope, price, program, qualifications and usual risk position. We identify provisions that can be accepted, provisions that need revision and remaining risk for your business to consider.

4. You receive and discuss the advice

Rachelle gives you the advice in the agreed format. Where a meeting forms part of the scope, she discusses the significant provisions, recommendations and negotiation priorities with you or the authorised Delegate.

5. You decide what happens next

Your business decides whether to sign, negotiate further or decline the work. We can prepare a Statement of Departures, Contract Mark-Up or Negotiation Checklist, or assess a revised version before signing. Further information is available under Construction Contract Negotiation.

What Types of Contract Reviews Does Blaze Business & Legal Carry Out?

We carry out pre-tender and pre-signing reviews for Head Contracts, Subcontracts, consultancy agreements, supply agreements, Government contracts and purpose-written Principal templates. We also examine amended Australian Standards, including the AS 4000 and AS 2124 suites listed by Standards Australia. See our guide to the types of Construction Contracts used in Australia.

Exception-Based Reviews

An exception-based review focuses on provisions outside your agreed risk settings, tender position or the usual industry position. Rachelle does not spend time reporting on provisions your business already accepts. This can reduce the scope, price and turnaround where you do not need a full report.

Residential Building Contract Reviews

We also review residential Building Contracts for homeowners, builders and residential contractors. This can cover scope, Contract Price, progress payments, Variations, time, delays, warranties, termination and Queensland residential building requirements. The Queensland Building and Construction Commission recommends checking all contract papers and obtaining legal advice before signing.

Businesses that require frequent advice can also use a regular review arrangement with agreed risk settings and advice formats.

How Do Legal and Commercial Reviews Differ?

A Legal Review addresses rights, obligations, liabilities, remedies, enforceability and recommended drafting. It can cover payment, Variations, delay, indemnities, insurance, termination and disputes.

A Commercial Review considers how the proposed position may affect margin, cash flow, resources, administration and delivery. It also considers whether the business priced the obligations and has the people and systems needed to manage them. A combined review connects the legal effect of each significant provision with its likely commercial consequences.

In What Format Can I Receive My Review and Advice?