Contract sum meaning

This Checklist sets out actions that can be taken—some at procurement stage and others during the life of a project—to help minimise the chance of disputes emerging on construction projects... During the procurement process Select the right procurement route Ensure the procurement method fits the specific context. For instance, where the employer wants to maintain control of the design or specified materials, a traditional contract may suit better than design and build. Conversely, if an earlier start on site is essential, design and build might be the preferred choice. See Practice Note: Choosing the right procurement method—construction projects. Adopt the correct pricing structure Choose a pricing approach that aligns with the employer’s objectives. If price certainty is a priority, a lump sum contract is generally more suitable than a prime cost arrangement. Where a lump sum is used, avoid inserting an excessive number of provisional sums, as these can undermine the desired cost certainty. See Practice Notes:...

Any resolution of a dispute should be set out in a signed, enforceable written agreement that precisely records the parties’ terms. This reduces the prospect of later misunderstanding and allows a party to commence proceedings if the other side does not comply. As the agreement is a contract, contract law governs its drafting and interpretation, so it must be written with clarity. This Checklist highlights the key considerations of particular importance to construction disputes. For illustrative clauses and deeper analysis (including drafting notes), see Precedent: Settlement agreement for construction dispute (long form). Ensure that settlement negotiations are conducted on a without prejudice basis State expressly that settlement discussions are conducted on a ‘without prejudice’ basis so that, if talks fail, any proposed concessions cannot be relied upon by the other party in subsequent legal proceedings. Do not assume that terms such as ‘confidential’ or ‘off the record’ offer comparable protection. For further detail, see Practice Note: Without prejudice communications. Who is entering into the settlement?...

This checklist on debt claims sets out the principal points to assess when pursuing a claim for a straightforward contractual debt. You should examine the claim’s character, the parties bound by the contract, the debtor’s resources, the sum said to be owed, the client’s objectives for litigation, relevant limitation periods, and any possible questions of jurisdiction. This Practice Note is intended to be read alongside Practice Note: Starting a contractual debt claim—a practical guide. Issue Considerations Is the intended cause of action truly a claim in debt? Matters that seem to be debt claims may, in fact, amount to claims for damages. Recognising the difference is crucial because practical consequences vary markedly between actions in debt and actions for damages, so you must make sure you are seeking the correct remedy. For further guidance, see Practice Note: Debt claims. Who are the parties to the agreement?...

KSY Juice Blends UK Ltd v Citrosuco GMBH [2024] EWHC 2098 (Comm) What are the practical implications of this case? The upshot of the ruling is that where a sale of goods contract stipulates that price is to be agreed, and it never is, the bargain cannot be enforced, since price is plainly a fundamental term of such an agreement. This is because the price of the goods is, quite clearly, an essential component of the contract itself. The judgment will interest both those who prepare sale of goods documentation and those involved in disputes where wording of this kind appears. One might assume that stating the price is to be agreed would, failing consensus, simply engage section 8 of the Sale of Goods Act 1979 (SGA 1979), so that the buyer must pay a reasonable sum. Yet, this decision in effect concludes that the statutory mechanism is displaced by a clause making future agreement the sole route to fixing price, which amounts to an agreement to agree...

Uniform Building Contractors Ltd v The Water and Sewerage Authority of Trinidad and Tobago [2026] UKPC 2 What was the background? The Privy Council appeal arose from a 2007 design-and-build, lump sum contract governed by the 1999 FIDIC Yellow Book, concluded between the Water and Sewerage Authority of Trinidad and Tobago (WASA) and Uniform Building Contractors Ltd (UBC) for the design, supply and installation of pipelines. The works were structured as two discrete packages, each on a lump-sum basis. Executed on 23 May 2007, the agreement incorporated the Yellow Book, bespoke Conditions of Particular Application, the Employer’s Requirements, together with a Bill of Quantities (BoQ). Mr Barry Paul was appointed as the Engineer under the contract. During execution, disputes between the parties arose over performance. WASA served termination notices dated 28 May and 4 June 2009. UBC commenced proceedings in May 2013, shortly before the limitation period expired, and WASA advanced a counterclaim. At first instance, the court dismissed both UBC’s claim and WASA’s counterclaim in full. WASA...

Project One London Ltd v VMA Services Ltd [2025] EWHC 3304 (TCC) What was the background? The parties contracted for the design and installation of mechanical services under their sub-contract, adopting the JCT Design and Build Sub-Contract Agreement Conditions 2016. The agreement included standard interim payment mechanisms, operating in the usual way. VMA lodged Application for Payment No. 8, stating £106,434.88 as the amount due (the Notified Sum). POL failed to issue either a payment notice or a pay less notice at any point. Project One Limited (POL) initiated a TVA. VMA relied on POL’s non-payment of the Notified Sum as a defence, contending on jurisdictional and/or substantive grounds that the TVA could not proceed in the face of that non-payment, and asking the adjudicator to require POL to pay the Notified Sum without delay. The adjudicator determined that VMA had made a valid Application for Payment and that POL had not served a valid Payment Notice and/or Pay Less Notice; it therefore followed that the Notified Sum...

What is the Pensions Advice Allowance? Following consultation in 2016/17, the government brought in, from 6 April 2017, the Pensions Advice Allowance. It enables eligible pension scheme members to withdraw a fixed sum from their pension pot tax-free to cover holistic retirement advice. At the member’s instruction, the scheme may therefore reduce the value of the member’s pot by the advice fee and pay the funds straight to the member’s adviser. This measure stemmed from the Financial Advice Market Review, which highlighted an advice gap affecting people who require retirement planning support but cannot meet the cost from net-of-tax income or savings. It is available in addition to other existing advice allowances and payment routes for advice. These include adviser charging, which does not permit pension monies to be used to fund holistic retirement advice. For further details, see Other types of pensions advice measures below. The government’s aim is to help those preparing for retirement to use the Pensions Advice Allowance to fund holistic...

This Practice Note is archived and no longer updated or maintained. It outlines the differences introduced in the NEC4 standard form construction contracts when set against the NEC3 versions. It also summarises the changes from NEC3 across the standard forms. The spotlight is on the NEC4 Engineering and Construction Contract (ECC), though many ECC revisions mirror those rolled out across the broader NEC suite. Many of the points made in relation to the ECC are indicative of suite-wide adjustments. The NEC characterises NEC4 as an ‘evolution not revolution’, building on NEC3. The bulk of NEC4’s revisions appear aimed at embedding sound practice and/or cutting reliance on Z clauses (ie bespoke amendments). For further details on NEC contracts in general, including their structure, see Practice Note: NEC contracts—introduction. Publication of NEC4 The NEC4 contracts were issued by the Institution of Civil Engineers on 22 June 2017...

Practice Note This Practice Note consolidates our content on the amendments as introduced in the 2024 editions of the Joint Contracts Tribunal (JCT) standard form construction contracts...

In the Employment Tribunals Case number: [ Insert case number ] Between: [ Insert name of claimant ] (Claimant) and [ Insert name of respondent ] (Respondent) Claimant's schedule of loss 1. Details Net basic pay per week (after deductions): £[ Insert amount ] Respondent’s yearly pension contributions/annual pension entitlement: [ [ Insert amount, e.g. £x ] OR [ Insert details of pension scheme, e.g. 1/80 final salary scheme with related lump sum ] ] Yearly value of bonus/other employment perks: £[ Insert amount ] Notice period under the contract: [ Insert period, e.g. x weeks or x months ] Claimant’s date of birth: [ Insert date ] Date employment ended: [ [ Insert date ] ] Age at termination: [ [ Insert age ] ] 2. ...

ARCHIVED: This Precedent is archived and is not being maintained. The Contract consists of the completed Design and Build Contract 2011 Edition published by the JCT (as amended by Amendment 1: CDM Regulations 2015), and is subject to the following amendments: RECITALS Third Recital Delete and replace with: ‘The Contractor has: reviewed the Site and satisfied himself regarding its measurements, position and other pertinent matters; considered the Employer’s Requirements and is satisfied that the Contractor’s Proposals and Contract Sum Analysis will fulfil the Employer’s Requirements; and accepted responsibility for the whole of the design contained in the Employer’s Requirements and the Contractor’s Proposals.’ ARTICLES Article 1 After ‘shall’ insert ‘carry out and’...

The Contract consists of the finalised Design and Build Contract 2024 Edition published by JCT subject to these amendments: RECITALS Third Recital Third Recital Delete and insert: 'The Contractor has: (a) reviewed the Site and confirmed he is satisfied about its measurements, position and other pertinent matters (b) considered the Employer’s Requirements and is content that the Contractor’s Proposals and Contract Sum Analysis will satisfy the Employer’s Requirements, and (c) undertaken to accept responsibility for the whole design contained in the Employer’s Requirements and the Contractor’s Proposals.' ARTICLES Article 1 Article 1 After 'shall' insert 'carry out and' Articles 6 and 7 [ See drafting note ] Article 9 Article 9 Delete Article 9 and insert: 'Not used.' Article 11 Insert new Article 11 as follows: 'Article 11 [ To be added on the face of the contract ] The Employer and the Contractor agree that the modifications in the Schedule of Amendments attached hereto (as initialled by...

Retention Retention describes the portion of interim payments the employer withholds as security for the contractor’s future performance of its duties and to encourage the contractor to discharge those duties in full and properly. For further details, consult the Practice Note: Retention of payment in construction contracts. When retention is to be released to the contractor depends on the particular contract terms for the project. Typically, half of the retained sum is paid out at practical completion, with the balance thereafter following completion of any remedial works for defects reported within the defects liability period. Consequently, if these milestones are reached before the final certificate is issued, the contractor may have a right to seek payment of some or all of the retention...