Sample fixed price construction contract

This is a contract for the construction of a building to be used as a residential facility. It includes the basic provisions regulating a simple construction project.

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Sample fixed price construction contract


This agreement is made and entered into by and between [Name of Party A],

Represented by: [Representative's name]
Registered Office: [Principal office]
Company Registration No.: [Company reg. No.]
Tax registration No.: [Tax registration No.]
Statistical No.: [Statistical No.]
Bank account No.: [Bank account No.]

(hereinafter referred to as {Party A}), on the one hand, and [Name of Party B]

Represented by: [Representative's name]
Registered Office: [Principal office]
Company Registration No.:[Company reg. No.]
Tax registration No.: [Tax registration No.]
Bank account No.: [Bank account No.]

(hereinafter referred to as {Party B}), on the other hand, {Party A} and {Party B} hereinafter collectively referred to as the Parties. in the place and on the date written below, with the following terms and conditions.

{Party B} undertakes to perform the construction works of the specified herein in accordance with the level of preparedness specified belowbased on the working drawings incorporated herein by reference. {Party A} undertakes to accept the works completed in conformity with the plans and pay the contract sum specified herein.
Level of preparedness:
The Parties agree that the level of preparedness of the works shall be: .


Corporate existence
{Party A} represents to be a business association which is duly incorporated and validly existing under the laws of [State of registration]. {Party A} represent to have the corporate power to execute, deliver and perform the obligations hereunder, and it is not subject to bankruptcy, liquidation or winding-up proceedings.
Existing conditions
{Party B} represents to be fully aware of the circumstances related to the construction activities.
Operation licences
{Party B} has obtained the necessary licences to conduct construction activity which are required for the completion of the project set out herein.
Delivery of the plans
{Party A} hereby acknowledges receipt of the plans and represents that it has no objection to them.
The Parties hereby confirm that the building permit is already in their possession concurrent with the signing of the contract.

{Party A} represents to be the owner of the following property:

The Property is registered at Topographical No. [Topographical number],
physically located in [City],
at [Address],


Payment in lump sum
{Party B} agrees to perform the works for a mutually agreed upon lump sum, based on the technical specification known and determined by the Parties. {Party B} agrees that its services will not result in fees in excess of the contract sum. This sum may not be altered without the prior consent of {Party A}. The lump sum shall include any and all items of the works specified in the drawings and specifications, including the reasonably included additional works not originally contemplated in the plans, which are indispensable for the completion free of any deficiencies. The cost of such items are included in the contract sum. Therefore they shall not be charged to {Party A} separately.
Determination of the sum
{Party B} has taken all possible technical and quality issues into consideration in the course of determining the contract sum.
Payment in lump sum
The Parties agree that the contract sum for the services to be provided hereunder is [Sum] euro + VAT, ([Sum] EUR + VAT). The Parties explicitly agree that the Fees will be a fixed lump sum fee for the provision of the Services which includes the entire consideration for the successful and due performance of the Services and all the fees, costs and other considerations payable for any other services of {Party B} hereunder.


After the completion of each phrases of the works, the contract sum shall be paid by {Party A} againt {Party B}’s invoice in accordance with the following schedule.


Payment by bank transfer
{Party A} shall pay the above specified sums by bank transfer within [Payment deadline] to the bank account of the {Party B} kept at [Name of the bank] (Bank account number: [Bank account number]). The amount of the invoice shall be deemed to have been paid after it has been credited to {Party B}’s account.

Late payment
If {Party В} delays making any of its payments, such amounts shall be subject to late charges payable for the delayed amount at the rate . Late payment fees shall be paid from the due date of the payment obligation.


In case of payment delay, {Party B} may suspend the works until such payments have been made.

Completion date of the services contemplated hereby: [Completion date] {Party B} shall perform the services by the date(s) specified in the Contract.
Importance of the deadline
{Party B} expressly acknowledges that the completion of the services set out herein by the set date is of the essence.


Rate of liquidated damages
In the event that {Party B} fails to complete the Work on the Project on or before the expiry of the Completion deadline, {Party B} shall pay to the Owner liquidated damages in the amount of [amount of liqudiated damages] per [frequency of liquidated damages payment]. The maximum amount of liquidated damages shall be limited in [maximum rate of liquidated damages] of the Contract Price. {Party B} consents to the deduction of the amoutn of that {Party A} deduct the due amount In the event of faulty performance, if {Party A} requests repair, the amount of liquidated damages shall be equal to that of delayed performance. The liquidated damages for late performance becomes due when the reason for the delay does not exist any longer, the additional deadline has elapsed or the amount of liquidated damages reaches the maximum.  In the event of faulty performance, if {Party A} does not request repair, the amount of liquidated damages shall be 10% of the value of the faulty services. If hte event of impossibility of performance or frustration of puropse due to the fault of {Party B}, the amount of liquidated damages shall be 20% of the contract sum. In addition to the late performance penalty, {Party A} may claim: Compensation for the damages resulting from the late performance In case of faulty performance, the value of the omitted works • In case of delay, the value of the omitted works, the value of the interim invoice.
Basis of the calculation of liquidated damages
• In case of delay of delivery, the entire contract sum. • in case of defects, the value of the defective work as specifed in the Bill of Quantities. • in case of frustration of purpose, the entire contract sum The amount of liquidated damages shall be considered overdue claims, whcih shall be immediately deducted from the amount of the invoices.
Events of default
The following events shall be considered a breach of contract: {Party B} does not meet the interim deadlines specified in the work schedule that are subject to liquidated damages. {Party B} fails to meet the final deadline. The performance of {Party B} is defective because the services do not conform to the requirements of specified in the order, or the products do not demostrate the quality specifed in the order or by the law upon the delivery of such products. The purpose of the contract is frustrated for a cause within the control of {Party B}.
Cases when no liquidated damages is payable
The parties shall be relieved from the consequences of the breach if: they can prove that the delay was caused by the other party's failure to fully comply with the provisions of the contract, they can prove that they were unable to perform their obligations as a result of a force majeure event. The person prevented from the performance of the services shall immediately inform the other party of the occurrence and the termination of the force majeure event. In the event of termination, {Party A} shall only pay for the works already completed until the date of termination.
Damages in excess of the amount of liqudiated damages
{Party A} may also claim damages in excess of the amount of liquidated damages.
Cancellation rights
Should {Party B}’s delay exceed [Number of days] days, {Party A} may cancel the contract based on the theory of frustration of purpose of the contract.


{Party B} provides warranty of [Warranty period] for the works to be performed hereunder.

{PARTY B} shall repair defects or imperfections within a reasonable time. Failure to do so shall be deemed a breach of contract. {PARTY B} shall make corrections or repairs at its own cost and expense at any time during the term of this contract.


Delivery of the site
{Party A} shall deliver the constrution site to {Party B} in a condition suitable to perform constrution works on the site.


Retention money
{Party A} shall be entitled to retain 5 % of the value of the invoices which shall be remitted after the repair of the defects listed in the defect list


Delivery of the plans
{Party A} shall deliver the plans to {Party B}


Only the personnel of {Party B} may enter the construction site.

{PARTY B} shall obtain all-risk insurance coverage. {Party B} shall present proof of payment of the premium. {PARTY B} is liable for all costs and expenses incurred by its failure to do so. The insurance policy is incorporated herein by reference as Appendix No. … . {Party B} shall be liable for any costs incurred as a result of its failure to obtain the necessary insurance policy.

{PARTY B} undertakes to keep a construction log {PARTY B} shall open a construction log upon the delivery of the construction site All comments related to the performance of the works shall be entered into the construction log. The Parties shall sign the entries on a daily basis.

{Party B} shall comply with all the rules and regulations of the industry, including, but not limited to environmental protection, fire prevention and labour safety regulations.

{PARTY B} agrees to perform the work in good and workmanlike quality. The materials incorporated in the works shall be first class quality.


{Party B}s's inspection
{PARTY B} shall inspect the quality of the works at all times The findings of {PARTY B}’s inspection must be recorded. {Party A} may, and shall, supervise the progress of the works


Neither Party shall be held liable to the other for any loss resulting from any failure or delay in its performance hereunder caused by force majeure. Any incident of force majeure which continues for two (2) calendar months from the date of notification of its existence shall give the non-affected party the right to terminate this Agreement upon one (1) calendar month's additional notice. The Parties agree that force majeure shall denote any events rendering the performance hereof totally or partially impossible which are either foreseeable but unavoidable or unforeseeable and unavoidable. The rules governing impossibility shall apply to force majeure events rendering the performance hereof impossible, In the event the force majeure event only delays but does not render the performance hereof impossible, the due date of performance shall be extended by the period of delay caused by force majeure. Either Party learning of a force majeure event shall immediately inform the other Part and be liable for any and all damage incurred by the other Party due to the failure of the first Party to inform the other Party.
Changes in the circumstances of the parties
Changes in the circumstances of the Parties shall not be deemed as force majeure and therefore do not exempt the Parties from fulfilling their obligations hereunder.


The Parties agree that this Contract may be modified at any time upon mutual consent. Such modification shall be made in writing, and shall be duly signed by the other party.

Parties agree that they seek to settle disputes arising herefrom amicably through negotiations.

Matters not regulated in this agreement shall be governed by the relevant provisions of the Civil Code.

This Agreement was prepared in [Prevailing language] and English languages. The Parties agree that the English language version was prepared exclusively for informational purposes. Only the [Prevailing language] version shall have legal effect and in the event of any legal dispute, the [Prevailing language] version shall prevail.

The Parties have signed this agreement on the date and place written below.

Witness 1
Name: {Name of witness 1}
Address: {Address of witness 1}
Identity card No.: {ID Card No. of witness 1}
Witness 2
Name: {Name of witness 2}
Address: {Address of witness 2}
Identity card No.: {ID Card No. of witness 2}