Question

Chapter:7 (Book - Business and legal principles)  

Q: legal issue in construction

What single most important fact about a subcontract distinguishes it from a purchase order? What may be provided by the subcontractor in addition to on-site labor? Must the work of a construction subcontract necessarily be directly and completely spelled out in the prime construction contract? May it be? Cite examples.

Answer 1

The main difference between the sub contract and purchase order is of the duration. Subcontract is long term contract or arrangements between the buyers as well as sellers. While purchase order is for short term , representing single business transactions

Subcontract shall provide following points in addition to on site labour-

• It shall be the duty of subcontracter to keep the site neat and clear on daily basis at his own expense
• Subcontract should even provide and play all of the labour , material , tools , transportation etc to kepp the work in progress
• He shall be responsible for the construction , method , coordinator , sequence of work done etc on the site

Yes, work of construction subcontract necessarily be and directetly be spelled out of prime construction contract. Suppose if the overpaid subcontract defaults , then cost to complete the works which is combined to the cost which is already to paid to subcontracter , is substantially more than amount which is already allocated by the prime contractor of the work. Hence the difference may ofcourse come out prime contract