1.0 Introduction
In construction practice, not only project manager, Architect, Quantity Surveyor, contractor carrying the important role, specialist sub-subcontractor also carrying the important role in order to success the construction project.
A sub contractor is a person or a company hired by a general contractor to perform part of the work of a construction job. For example, a contractor might be building a house, but might hire a firm or a person specializing in electrical engineering to install the electrical systems needed in the house. Generally the subcontractor will either relieve the main contractor of part of the building work, or will be able to perform work at lower expense or at a greater skill level than the general contractor could. (Tricia Ellis- Christensen 2003-2009) http://www.wisegeek.com/what-is-a-subcontractor.htm
Normally sub-contractor carry out the works like electrical, heating and cooling devices (HVAC), plumbing, plastering, brickwork and roofing. There are 3 different kind of sub-contractor in construction practice and they are:
Nominated sub-contractor
Nominated sub-contractor
Is a person nominated by the Architect or Contract Administrator to the contractor in order to carry out the sub-contract work and there was a direct contractual relationship between the clients and the subcontractor. Other than that, contractor has the right to make reasonable objection on the selected sub-contractor by the Architect.
Domestic sub-contractor
Is a person who has direct contractual relationship with the main contractor. All the sub-contract work done by the employed sub-contractor has to be responsible by the main contractor. For example, if there is any sub-contract work done badly and cause the delay of the project then the main contractor have to responsible for it.
Named sub-contractor
Is similar to the domestic sub-contractor, but named sub-contractor often use in Intermediate Building Contract (IC) and Intermediate Building Contract with contractor’s design (ICD). The idea is to provide the employer with means of ensuring that particular parcels of work are carried out by sub-contractors of the employer’s choice. (Chappell D, 2007, pg 38).
2.0 Review the method of appointing a specialist sub-contractor
A nominated sub-contractor is often appointed after the main contractor has started work, so one of the client benefits is that specialist design can continue after work has commenced on site. A prime cost sum is included within the main contractor’s tender document (a bill of quantities or specification of work). On top of this the main contractor is required to price overheads, profit and any items of attendance it has to provide, such as the use of site facilities, provision of a secure storage area etc. The value of the prime cost sum is omitted from the Bill of Quantities and replaced by the nominated subcontractor’s accepted quotation and the main contractor’s on costs are adjusted as appropriate. (Electrical & Mechanical Contractor magazine 2005)
There are some reasons for nomination of sub-contractor:
The employer will have his freedom to choose a sub-contractor that he wishes to use and is not based on price.
The employer can take control of the timing involvement and appointment of sub-contractor to meet his requirement.
The employer has the chance to make comparison which sub-contractor is better and suitable for the particular sub-contract work.
Time is saved by introducing formal links between the sub-contractor and the consulting engineer, architect, QS. Hence, there are no long chains of correspondence and quick action on price, design, programme, variations etc. is established.
In a project there will be some specialist works which only can done by the specialist team like sub-contractor.
The nominated sub-contractor can be involved early and so his design expertise and his knowledge of the contract and co-ordination of services can be utilized.
2.1 Procedure of nomination
The standard form of nominated sub-contract tender 1998 Edition (NSC/T) which comprises in 3 parts.
Part 1: Invitation to tender to a subcontractor by the Architect’s/The contract administrator
During the part 1, the invitation to tender to a subcontractor (NSC/T) of a standard form of tender will be completed by the Architect. Other than that, the relevant section of the employer/ nominated sub contractor agreement, (NSC/W), and both documents, together with the drawing/specification/bill of quantities which describe the work will be completed and sent by the Architect to those companies the employer who wishes to invite to tender.
Part 2: Tender by the Subcontractor
During this part, those subcontractors who are interesting in this tender will complete the standard form of tender and the relevant sections of the warranty, (NSC/W) and return both documents to the Architect. After the Architect had received both documents, one of the sub contractors will be selected by the Architect and will arrange to the employer to sign and confirm of the approval of the sub contractor’s tender and to execute the warranty, (NSC/W). Then, the Architect nominates the selected sub contractor to the main contractor by using the standard nomination instruction, (NSC/N). Other than that, a copy of the invitation of tender and the successful sub contractor’s tender with all the documents and details in part 1 will be sent by the Architect to the contractor under clause 35.6. Once the contractor gets receipt of those documents, within 7 days, he may either accept or he may exercise his right of reasonable objection to the selected tender. If the contractor made a reasonable objection in writing to the architect within the 7 working days, under clause 35.5 Architect may either issue further instruction to remove the objection so that the contractor can comply or accept the objection and nominate another sub contractor.
Part 3: Particular Conditions (To be agree by the contractor and the subcontractor nominated under clause 35.5)
Under the ‘Particular Condition’ set out in this part of (NSC/T), these include sub-contract period, insurance details, and the identity of the adjudicator and trustee stake-holder. Once reached the arrangement on Particular Condition, the contractor and sub contractor sign (NSC/T) part 3 and execute the sub-contract articles of agreement, (NSC/A), which together with reference the sub-contract conditions (NSC/C). After both of them had signed (NSC/T) part 3, a copy of signed (NSC/T) part 3 together with the executed sub-contract articles of agreement, (NSC/A) will be sent to the Architect for his records.