COST-PLUS CONTRACT FOR CONSTRUCTION OF A BUILDING

 

THIS AGREEMENT made this______ day of______, 20__.

BETWEEN

________________________ (insert the name, address etc. of the first party) (hereinafter called ‘The First Party’) of the ONE PART.

AND

________________________ (insert the name, address etc. of the second party) (hereinafter called ‘The Second Party’) of the ONE PART.

WITNESSETH as follows:

1. SECONDPARTY agrees to employ first party___________ Company in the erection of a building, as hereinafter described in the schedule hereto under the following conditions and terms:
2. FIRST PARTY agrees to furnish complete plans and specifications, hire all labour and bury all materials and make contracts for such departments of the work as are necessary to handle in that manner AND also agrees to employ and depute a competent superintendent to oversee all work and inspect all materials, to ensure obedience to the specifications, look after paying all bills of every kind and nature in connection with the work, and obtain waiver on lien from all material companies and sub-contractors.
3. First party estimates the cost of the building, including their own services, in advances of making the complete plans and specifications will not exceed Rs _________ (Rupees___________), and should the final figures obtained after making plans and specifications, exceed the above estimate, either party shall have the right to cancel the contract.
4. It is agreed by both parties that the actual cost of the building shall be on the basis of the cost of material and labour and the amounts paid to sub- contractors, to which shall be added_________% for overhead expense incurred by the first party and___________ % to cover the services of first party. If these total figures shall exceed the above estimate the excess shall be paid by the first party, and if they are less than said above figures, the second apart shall have the benefit. Should any changes be made, after the contract has been signed, which increases the cost, the guaranteed figures as above stated, shall automatically be increased accordingly.
5. Second party agrees to co-operate with first party and pay any costs that may be necessary in the financing of the building, and to pay first party for construction of the building in the following manner.

• ___________ % when foundation walls are complete;
• ___________ % when roof is on;
• ___________ % when the plumbing and electrical/air conditioning cables are roughed in;
• ___________ % when the interior finish is complete.
• ___________ % balance when all work is completed.

SCHEDULE OF SPECIFICATION REFERRED TO?

IN WITNESS WHEREOF, both parties have signed and sealed their names_______