Definition of Terms PDF

SCOPE This document specifies general conditions of contract between a private Owner and Contractor applicable for the construction of any type of structure or works as contemplated in the Republic Act No. 4566 otherwise known as Contractors’ License Law. Section I Definitions and Documents...

SCOPE This document specifies general conditions of contract between a private Owner and Contractor applicable for the construction of any type of structure or works as contemplated in the Republic Act No. 4566 otherwise known as Contractors’ License Law. Section I Definitions and Documents Article 1 Definitions For the purposes of this document, the following definitions apply: 1.01 act of God or force majeure shall mean any event beyond the reasonable control of the Owner or the Contractor, as the case may be, and which is unavoidable notwithstanding the reasonable care of the party affected and shall include, without limitation, the following: (a) war, hostilities or warlike operations (whether a state of war be declared or not), invasion, act of foreign enemy, civil war; (b) rebellion, revolution, insurrection, mutiny, usurpation of civil or military government, conspiracy, riot, civil commotion, terrorist acts; (c) confiscation, nationalization, mobilization, commandeering or requisition by or under the order of any government or de jure or de facto authority or ruler or any other act or failure to act of any local or state or national government authority; (d) strike, sabotage, lock-out, embargo, import restriction, port congestion, lack of usual means of public transportation and communication, industrial dispute, shipwreck, shortage or restriction of power supply, epidemics, quarantine, plague; (e) earthquake, landslide, volcanic activity, fire, flood, inundation, tidal wave, typhoon or cyclone, hurricane, storm, lightning, or other inclement weather condition, nuclear and pressure waves, or other natural or physical disaster; (f) shortage of labor, materials or utilities where caused by circumstances that are themselves force majeure. 1.02 advance payment/ down payment the money given by the Owner to the Contractor to help the latter underwrite significant start up or procurement costs that may have to be incurred before construction begins 19 1.03 Agreement the term used to describe the agreement signed by the Owner and the Contractor excluding the Contract Documents which are attached thereto 1.04 As-Built Drawings drawings showing the structure as actually constructed including system and actual locations of outlets, fixtures, services and equipment that were installed 1.05 bid the tender, proposal, quotation, or offer of a bidder to perform the Work described in the Contract which in form and substance complies with the Instruction to Bidders 1.06 bid bond any acceptable form of bond accompanying the Bid submitted by the bidder as a guarantee that the bidder will enter into the Contract with the Owner for the construction of the Work, if the Contract is awarded to him 1.07 Bid Bulletin a document containing additional information on Bid Documents issued to bidders before date of bidding 1.08 Bid Documents collectively refer to all documents provided or made available to prospective bidders which include the Invitation to Bid, drawings and technical specifications and a copy of the Contract which the winning bidders would be required to sign with the Owner 1.09 Breakdown of Work and Corresponding Value a listing of the different parts of the Work indicating each part and its corresponding value 1.10 change order a written order to the Contractor issued by the Owner after the execution of the Contract, authorizing a change or variation in the Work or an adjustment in the Contract Price or Contract Time 20 1.11 Completion time limit period of time allowed by the Contract for the completion of the project or any stipulated portions thereof 1.12 Contract the term used to describe the Agreement and the Contract Documents 1.13 Contract Documents documents attached to the Agreement identified therein as Contract Documents, including all additions, deletions and modifications incorporated therein. These generally include the following documents which shall form part of this Contract and constitute integral parts hereof: (a) Special Provisions or Conditions; (b) General Conditions; (c) Specifications; (d) Drawings; (e) Contractor’s Performance and Payment Bonds contemplated in Clause 31.04 hereof; (f) Contractor’s Guarantee Bond contemplated in Clause 31.05 hereof; and (g) other Bid Documents 1.14 Contractor the person or firm duly registered and licensed by the Philippine Contractors Accreditation Board whose proposal has been accepted and to whom the Contract to execute the Work was awarded 1.15 Contract Price the amount in money, or other consideration, to be paid by the Owner to the Contractor for the execution of the Work in accordance with the Contract 1.16 cost all expenditures properly incurred or to be incurred, whether on or off the site, including overhead and other charges properly allocable thereto but does not include any allowance for profit 21 1.17 Drawings graphical presentations of the Work that include all supplementary details and shop drawings 1.18 Final payment the payment of the final progress billing and all approved claims including but not limited to variations in the work, Contract Price adjustments and/or escalation, acceleration of work, and others. NOTE: final payment does not include the retention money 1.19 Guarantee Bond approved form of security furnished by the Contractor and its Surety as a guarantee of the quality of the materials provided, the equipment installed, and the workmanship performed by the Contractor 1.20 Instruction to Bidders the list of instructions regarding the manner bids are to be prepared and the conditions for the award of the Contract 1.21 Invitation to Bid the notice or advertisement published by the Owner or the invitation issued to prospective bidders, giving information as to the nature of the proposed project, conditions for the issuance of Contract documents, date of bidding, and information that would give the Contractor a general idea of the magnitude and extent of the project 1.22 last known address of a party refers to the address in the Philippines given by a party in the Contract 1.23 Laws all laws, ordinances and other governmental rules and regulations applicable to the project and to its execution 1.24 Owner person or entity, or authorized representative thereof, who signed the Contract as Owner 22 1.25 Owner's Representative the person or entity commissioned by the Owner, or authorized in writing by the Owner, to act on its behalf 1.26 Payment Bond approved form of security furnished by the Contractor and its Surety as a guarantee of good faith on the part of the Contractor to faithfully comply with the Contract in respect of its obligations arising therefrom to its workers, Sub-Contractors, and suppliers 1.27 Performance Bond approved form of security furnished by the Contractor and its Surety as a guarantee of good faith on the part of the Contractor to execute the Work in accordance with the Contract 1.28 retention sum of money, usually 10% or less of every progress payment to a Contractor which the Owner retains to underwrite future costs of completing the Contractor’s work and/or remedying the defects therein 1.29 Schedule of Materials and Finishes an outline specification enumerating the type or brand names of materials required to be used by the Contractor for the Work 1.30 Special Provisions or Conditions instructions issued prior to bidding to supplement and/or modify the Drawings, Specifications and/or General Conditions of the Contract 1.31 Specifications written or printed description of the Work to be done describing qualities of the material to be used, the equipment to be installed and the mode of construction 1.32 Sub-Contractor a Contractor duly registered and licensed by the Philippine Contractors Accreditation Board having a direct contract with the Contractor and who acts for or in behalf of the Contractor in executing any part of the Contract 23 NOTE: one who furnishes materials without labor is a supplier and not a Sub-Contractor 1.33 Supplementary Specifications additional information which may be issued as an addition to or amendment of the provisions of the Specifications 1.34 Surety person, firm, or corporation which issues the bond required of the Contractor 1.35 Work shall refer to all the Contractor-provided labor or materials or both, as well as equipment transportation or other facilities necessary to commence and complete the construction and to fulfill all its obligations which are called for in the Contract 1.36 written notice information, advice, or notification pertinent to the project delivered in person or sent by registered mail to an individual, firm or corporation at the latter's last known business address Article 2 Execution, Correlation, Meaning of Terms, and Intent of Documents 2.01 Intent of Contract The intent of the Contract is to include all labor and materials, equipment, and transportation necessary for the proper execution of the Work. 2.02 Standard of Conduct Each party to the Contract acknowledges that, in the exercise of each party’s rights and in the performance of his duties, each must act with justice, give the other party its due, and observe honesty and good faith. 2. 03 Interpretation of Contract (a) In case of conflict between the provisions of the Agreement or of any Contract Document, or between the provisions of one of the Contract Documents and the provisions of another Contract Document, or in case of discrepancy, defective description, error or omission in the Contract, the following rules shall be followed: 24 RULE 1: The Agreement and the Contract Documents shall be taken as mutually explanatory of one another. The various provisions of the Contract shall be interpreted together, attributing to the doubtful ones that sense which may result from all of them taken jointly. RULE 2: The provisions of the Civil Code of the Philippines on the interpretation of contracts and of the Rules of Court on the Interpretation of Documents shall be applied. RULE 3: Where the conflict between or among the provisions of the Agreement and/or the Contract Documents cannot be resolved by Rules 1 and 2, it shall be understood that: (a) the Detailed Drawings shall prevail over the General Drawings; (b) words and figures shall prevail over the Drawings; (c) words shall prevail over figures in Contract Documents; and (d) written dimensions shall prevail over measured dimensions. RULE 4: Where the conflict cannot be resolved by applying Rule 3 or where Rule 3 does not apply, the conflict shall be resolved by giving precedence to the Agreement or to provisions of a Contract Document higher in order of priority among the various documents which comprise the Contract. The order of priority among these documents shall be as follows: (a) Agreement as modified by Notice of Award of Contract, if such be the case, and the Contractor’s conformity thereto; (b) Instruction to Bidders and any amendment thereto; (c) Addenda to Bid Documents; (d) Specifications; (e) Special Conditions of Contract; (f) General Conditions of Contract; (g) Drawings; (h) Contractor’s Performance and Payment Bonds contemplated in Clause 31.04 hereof; (i) Contractor’s Guarantee Bond contemplated in Clause 31.05 hereof; (j) Other Contract Documents; and 25  (k) Other documents forming part of the Contract attached thereto or incorporated therein by reference. Where the order of precedence is modified in the Agreement, such modified order of precedence shall be followed; however, the mere listing of Contract Documents in the Agreement or any Contract Document shall not be interpreted as establishing an order of precedence among them. RULE 5: Where there is discrepancy, defective description, error or omission in any Contract Document, the Contract Documents shall be interpreted as being complementary to each other. Thus, what is called for in one Contract Document, although not mentioned in another Contract Document where it should have been mentioned, shall be deemed to be called for by the Contract. RULE 6: The apparent silence of the Drawings, Specifications or any other Contract Document as to any detail, or the lack of detailed description concerning any part of the work, shall be understood to mean that good and accepted construction practice in accordance with the usage or custom of the place shall be followed. RULE 7: Rules 1 to 6 shall yield to specific rules of interpretation in this document or in the Contract. (b) The Owner shall resolve the conflict, or interpret or explain such discrepancy, defective description, error or omission with due regard to Article 2.04. (c) The interpretation of or explanation by the Owner shall be issued in the form of instructions to the Contractor. Where the Owner fails to issue the instructions in writing, the execution of that part of work affected by the interpretation or explanation without a timely objection or protest of the Owner shall be deemed to have been executed in accordance with the Owner's explanation or interpretation. (d) In all cases where a device, item, or part of equipment is referred to in the singular number, it is intended that such reference shall apply to as many such devices, items, or parts as are required to complete the work. 2.04 Conformity to the Contract The Work shall be executed in accordance with the Contract. 26