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The Breakdown of a Contract via Liveindias

The contract contains the details agreed upon by the parties involved in a project or  agreement. The contract details should be clear and complete. Both parties should be able to understand what is written in the contract. If you wish to make a contract or you are about to sign a contract, it is best that you know what a contact must have.

A basic contract usually has five elements:

The work to be done for the project should be clearly stated in the contract. The work the contractor would do and will not do should be indicated in the contract. The work to be accomplished should be clear to both parties to prevent any misunderstanding.

The time limit of the project is also a very important aspect. In construction projects where the time is of essence, the contractor should be able to meet with the deadlines. In some contracts, a penalty is usually included in the clause if the contractor will not be able to meet the deadline and a bonus is also given if the project is ready before the deadline.

The payment clause of the issue tackles the monetary issue in the contract. Some contracts are paid in a fixed price while others are paid by computing the cost of materials and the time spent on the project. The manner on how the payment is to be done (either monthly or weekly or so forth) and when the payments should be made are also specified on the contract. The arrangement of the payments should be agreed by both parties to satisfy the quality of the work done.

The contract should also address any confidentiality issues and reporting of the progress of the project. The contract should state all the information that the contractor should not divulge in any circumstances. The information should also be kept just between the contractor and the buyer. Information should not be divulged for the buyer’s benefit unless you discover it to be illegal and proper authority should be contacted. The progress on the project can also be reported to the buyer only unless stated otherwise in the contract.

Warranty and subcontractors on any project made is also indicated in the contract. Warranty length can be established at the time of close.  This is to ensure that any services done will be of high quality and done in a timely manner. If a subcontractor will be needed for the project, the buyer should know of it and have a list of the subcontractors. The buyer must first agree on the list of subcontractors before signing the contract.

via What Should Your Contracts Have? — liveindias