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New Construction Agreement for the United Kingdom

New Construction Agreement Template for England and Wales

A New Construction Agreement under English and Welsh law is a legally binding contract that establishes the terms and conditions for new building works. It defines the relationships, responsibilities, and obligations between the employer and contractor, covering aspects such as payment terms, construction timeline, quality standards, and risk allocation. The agreement incorporates requirements from key legislation including the Housing Grants, Construction and Development Act 1996 and the Construction (Design and Management) Regulations 2015.

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New Construction Agreement

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What is a New Construction Agreement?

The New Construction Agreement is essential for projects involving new building works in England and Wales. It provides a comprehensive framework for managing construction projects, ensuring compliance with relevant legislation and industry standards. This agreement is particularly crucial as it defines payment mechanisms, sets out dispute resolution procedures, establishes quality standards, and allocates risks between parties. It incorporates mandatory requirements from construction legislation while allowing flexibility to accommodate project-specific needs.

What sections should be included in a New Construction Agreement?

1. Parties: Identification and details of the contracting parties (employer and contractor)

2. Background: Context of the agreement and brief description of the project

3. Definitions and Interpretation: Key terms used throughout the agreement and rules of interpretation

4. Contractor's Obligations: Core duties and responsibilities of the contractor including compliance with Construction (Design and Management) Regulations 2015

5. Employer's Obligations: Core duties and responsibilities of the employer including site access and regulatory compliance

6. Contract Price and Payment: Payment terms, mechanisms, and schedules in accordance with Housing Grants, Construction and Development Act 1996

7. Time and Programme: Project timeline, completion dates, and delay provisions

8. Design Responsibilities: Allocation of design responsibilities between parties and compliance with Building Regulations 2010

9. Insurance and Indemnities: Required insurance coverage and indemnification provisions

10. Termination: Circumstances and procedures for contract termination

What sections are optional to include in a New Construction Agreement?

1. Performance Security: Provisions for bonds or guarantees requirements - used for high-value projects or where employer requires additional security

2. Sectional Completion: Provisions for completing work in defined sections - used when project requires phased completion

3. Liquidated Damages: Pre-agreed damages for delay or performance failure - used when specific losses can be predicted and quantified

4. Step-in Rights: Rights to take over contractor's obligations - used for critical projects or where contractor default risk is high

What schedules should be included in a New Construction Agreement?

1. Schedule of Works: Detailed description of works to be performed

2. Programme: Detailed project timeline and milestones

3. Payment Schedule: Breakdown of payments, stages, and amounts

4. Site Information: Details about the construction site and conditions

5. Design Documents: Drawings, specifications, and design requirements

6. Forms of Bonds/Guarantees: Template documents for required security

7. Insurance Requirements: Detailed insurance specifications and levels

8. Key Personnel: List of key staff and their roles

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

England and Wales

Document Type

Project Agreement

Cost

Free to use
Relevant legal definitions


















































Clauses







































Industries

Housing Grants, Construction and Development Act 1996: Primary legislation governing construction contracts, including payment provisions, adjudication rights, and notice requirements. Amended by Local Democracy, Economic Development and Construction Act 2009.

Construction (Design and Management) Regulations 2015: Regulations covering health and safety requirements, principal contractor duties, and client obligations in construction projects.

Building Act 1984 and Building Regulations 2010: Legislative framework ensuring compliance with building standards and building control approval requirements.

Contracts (Rights of Third Parties) Act 1999: Legislation governing third-party rights in construction contracts.

Late Payment of Commercial Debts (Interest) Act 1998: Legislation concerning interest on late payments in commercial transactions.

Defective Premises Act 1972: Act dealing with liability for defective construction work and ensuring habitable dwellings.

Party Wall etc. Act 1996: Legislation governing works affecting party walls, boundary walls, and excavations near neighboring buildings.

Health and Safety at Work etc. Act 1974: Fundamental health and safety legislation affecting construction operations.

Environmental Protection Act 1990: Legislation concerning environmental protection during construction activities.

Payment Mechanisms: Contractual provisions for payment schedules, valuations, and payment notices.

Dispute Resolution Procedures: Framework for handling disputes through adjudication, mediation, or litigation.

Insurance Requirements: Specifications for required insurance coverage including professional indemnity, public liability, and contractors all-risk insurance.

Warranties and Guarantees: Provisions for workmanship warranties, material guarantees, and performance standards.

Design Responsibility: Allocation of design responsibilities and obligations between parties.

Site Conditions and Access: Terms governing site access, working conditions, and site management responsibilities.

Variations and Changes: Procedures for handling contract variations, changes in scope, and associated cost implications.

Completion and Practical Completion: Definitions and procedures for achieving practical completion and final completion.

Defects Liability: Terms covering defects identification, rectification period, and remedial works obligations.

Force Majeure Provisions: Clauses dealing with unforeseen circumstances and events beyond parties' control.

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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