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New Construction Agreement

New Construction Agreement Template for South Africa

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Key Requirements PROMPT example:

New Construction Agreement

"I need a New Construction Agreement for a 20-story commercial office building project in Cape Town, with a contract value of approximately R500 million and construction period from March 2025 to December 2025, including specific provisions for green building certification and local community employment."

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Document background
The New Construction Agreement is a fundamental legal document used in South Africa when engaging contractors for new building projects. It serves as the primary contract between an employer/principal and a contractor, establishing the framework for project execution, risk allocation, and parties' obligations. This agreement is particularly important in the South African context due to the specific regulatory requirements of the Construction Industry Development Board (CIDB), National Building Regulations, and various environmental and labor laws. The document is designed to protect all parties' interests while ensuring compliance with local legislation, including the Occupational Health and Safety Act and Consumer Protection Act. It's typically used for both commercial and residential construction projects and can be adapted for various scales of development, from single buildings to large-scale developments.
Suggested Sections

1. Parties: Identification and details of the Employer and Contractor, including registration numbers and addresses

2. Background: Context of the agreement, including project overview and purpose

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

4. Scope of Works: Detailed description of construction works to be performed

5. Contract Price and Payment Terms: Amount payable, payment schedule, retention provisions, and invoicing requirements

6. Project Timeline: Commencement date, completion date, and key milestones

7. Contractor Obligations: Key responsibilities including workmanship, materials, safety, and compliance

8. Employer Obligations: Responsibilities including site access, approvals, and information provision

9. Quality and Standards: Required quality levels, applicable standards, and inspection procedures

10. Variations: Process for managing changes to scope, price, or timeline

11. Health and Safety: Safety requirements, responsibilities, and compliance measures

12. Insurance and Indemnities: Required insurance coverage and mutual indemnification provisions

13. Defects Liability: Defects liability period and rectification obligations

14. Termination: Grounds for termination and consequences

15. Dispute Resolution: Process for resolving disputes including mediation and arbitration

16. General Provisions: Standard legal provisions including notices, assignment, and governing law

Optional Sections

1. Environmental Management: Required for projects with significant environmental impact or requirements

2. Community Engagement: For projects requiring local community consultation or benefits

3. Performance Security: When bank guarantees or performance bonds are required

4. Intellectual Property: For projects involving design elements or proprietary methods

5. Force Majeure: Detailed provisions for unforeseen events, particularly relevant for longer-term projects

6. Local Content Requirements: For projects subject to local content or B-BBEE requirements

7. Utilities and Services: For projects requiring significant utility connections or relocations

8. Subcontracting: When subcontracting is anticipated or needs specific regulation

Suggested Schedules

1. Schedule 1 - Scope of Works: Detailed technical specifications and drawings

2. Schedule 2 - Project Program: Detailed timeline with milestones and critical path

3. Schedule 3 - Price Schedule: Detailed breakdown of contract price and bill of quantities

4. Schedule 4 - Site Information: Site details, access points, and existing conditions

5. Schedule 5 - Required Insurance: Specific insurance requirements and minimum coverage

6. Schedule 6 - Key Personnel: List of key personnel from both parties and their roles

7. Schedule 7 - Forms and Certificates: Standard forms for variations, completion certificates, etc.

8. Schedule 8 - Environmental Requirements: Environmental management plans and requirements

9. Appendix A - Technical Drawings: Complete set of construction drawings

10. Appendix B - Quality Assurance Plan: Detailed quality control procedures and requirements

Authors

Alex Denne

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

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Agreement
Applicable Laws
Approved Drawings
Bill of Quantities
Certificate of Completion
Certificate of Practical Completion
Commencement Date
Completion Date
Construction Documents
Construction Period
Contract Price
Contractor
Contractor's Equipment
Day
Defects
Defects Liability Period
Employer
Employer's Requirements
Extension of Time
Force Majeure
Good Industry Practice
Health and Safety Plan
Intellectual Property Rights
Key Personnel
Material Breach
Materials
Milestone
Parties
Payment Certificate
Payment Period
Performance Security
Principal Agent
Programme
Project
Project Manager
Quality Assurance Plan
Retention Money
Site
Specifications
Subcontractor
Substantial Completion
Variation
Works
Clauses
Interpretation
Site Access and Possession
Contract Price and Payment
Performance Security
Design Obligations
Quality and Workmanship
Time for Completion
Variations
Delay and Extension of Time
Health and Safety
Environmental Protection
Insurance and Indemnity
Defects Liability
Testing and Inspection
Warranties
Subcontracting
Assignment and Novation
Suspension and Termination
Force Majeure
Dispute Resolution
Confidentiality
Intellectual Property
Compliance with Laws
Notices
Risk Allocation
Performance Guarantees
Materials and Equipment
Labor and Personnel
Progress Reports
Site Conditions
Utilities and Services
Security of Site
Governing Law
Boilerplate Clauses
Relevant Industries

Construction

Real Estate Development

Infrastructure

Commercial Property

Residential Property

Industrial Development

Mining

Healthcare

Education

Retail

Hospitality

Relevant Teams

Legal

Construction

Project Management

Commercial

Procurement

Risk and Compliance

Operations

Technical Services

Development

Contract Administration

Relevant Roles

Construction Manager

Project Director

Contract Manager

Legal Counsel

Development Manager

Site Manager

Quantity Surveyor

Project Manager

Risk Manager

Compliance Officer

Commercial Director

Chief Operating Officer

Procurement Manager

Construction Director

Technical Director

Industries
Constitution of South Africa: The supreme law that provides the legal foundation for all other laws and regulations, including property rights and fair labor practices
National Building Regulations and Building Standards Act 103 of 1977: Sets out the technical requirements and standards for construction work in South Africa
Occupational Health and Safety Act 85 of 1993: Governs workplace safety requirements and obligations for construction projects
Construction Industry Development Board Act 38 of 2000: Provides for the establishment of the CIDB and regulations governing construction contracts and contractor registration
Consumer Protection Act 68 of 2008: Protects consumers' rights in construction contracts and sets requirements for fair terms and conditions
National Environmental Management Act 107 of 1998: Governs environmental protection requirements during construction activities
Employment Equity Act 55 of 1998: Ensures fair employment practices and transformation in the construction industry
Basic Conditions of Employment Act 75 of 1997: Sets minimum employment conditions for construction workers
Housing Consumers Protection Measures Act 95 of 1998: Protects housing consumers and regulates the home building industry
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,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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