Construction Works Contract

Construction works contract – a professional template in Word format

A construction works contract is concluded between the client and the contractor when work is carried out on a property – refurbishing a bathroom, replacing a roof structure, a facade, a screed, painting and decorating or installation work. Most disputes between clients and tradespeople do not arise from poor workmanship, but because nobody wrote down what exactly is included in the price, how long the works will take and what happens if the deadline is missed. This template covers precisely those points.

The contract is based on the rules of the Obligations Act (Zakon o obveznim odnosima) on the contract for work and the construction contract. No certification is prescribed for its validity, but in practice written form is the only way to prove the scope of the works, the price and the deadlines later on.

Key features

• Professional template – 12 articles that guide the job from the bill of quantities and the price, through the deadlines and supervision, to the handover and the warranty.
• Practical reliability – the bill of quantities is attached as an integral part of the contract, and subsequent and additional works are valid only in writing, which removes the most common source of disputes.
• Easy customisation – three pricing models and two models for supplying the materials, so the same document covers both a small job for a tradesperson and a larger refurbishment.
• Digital delivery – the DOCX file with instructions arrives by e-mail immediately after purchase, ready for completion and signing.

What the template includes

• Details of the client and the contractor and a description of the works, with an option to refer to the bill of quantities as Annex 1.
• The place of performance with the address of the property and the possibility of entering the cadastral parcel and the cadastral municipality
• Three pricing options – a fixed total turnkey price, calculation using the unit prices from the bill of quantities and the quantities actually carried out, or an hourly rate with materials charged according to actual consumption
• The payment schedule – an advance expressed as a percentage, instalments against interim payment certificates and the balance on final account and successful handover
• The start and completion deadlines for the works and the rule that delays on the client’s side extend the deadline for the duration of the delay
• Two options for supplying materials – the contractor supplies them and includes them in the price, or the client supplies the materials with liability delimited accordingly
• Quality and supervision – performance in accordance with the rules of the trade and technical regulations, the client’s right to object and the contractor’s duty to give warning of defects in the instructions and the documentation
• The handover with a joint inspection and a record in which defects and the deadline for remedying them are entered
• The warranty period for the quality of the works carried out and the procedure for remedying defects at the contractor’s expense, including the client’s right to have them remedied by a third party
• An optional contractual penalty for delay per day, with an upper limit expressed as a percentage of the total price, while retaining the right to compensation for greater loss
• Site safety obligations and the contractor’s liability for damage towards the client and third parties
• Instructions for completion with recommendations on the retention amount, the size of the advance, permits and agreeing extra works in writing

Who this template is intended for

• Owners of flats and houses who are commissioning a refurbishment, renovation or larger repair.
• Tradespeople and construction companies who need a proper contract instead of a one-page quotation.
• Investors who work with several contractors and need clear deadlines, payment certificates and handover.
• Co-owners and building managers who commission works on the common parts of a building.

Important: obtaining the building permit or notifying the works to the competent authorities is the client’s responsibility, unless otherwise agreed in writing. Before the works begin, check whether a permit is required for the intervention at all.

If you are commissioning a smaller job with no bill of quantities and no building site, the contract for work (services) template is enough. We explain how to set the price, the advance and the handover in our guide ugovor o izvođenju radova (construction works contract).