Lump Sum Payment Sub-Contracts
The sub-contract templates in this subfolder are suitable for all small scale construction projects. They can be used by a builder or main contractor to engage an electrician, plumber, plasterer, bricklayer or any other type of sub-contractor.
These sub-contracts provide for a one-off payment to be made on completion of the works. Some of the templates make provision for a retention to be held by the contractor. The retained amount is paid to the sub-contractor when the defects liability period has expired, so long as the sub-contractor has remedied any defects.
All of the templates include detailed provisions to ensure the parties understand what is expected of them, thus reducing the scope for disputes. Descriptions of the main contract works and the sub-contract works need to be inserted. A timescale is set out for completion of the works and the agreement lists the day-to-day obligations of the contractor and sub-contractor. The sub-contracts have clauses dealing with payments to the sub-contractor, the sub-contractor’s liability and insurance.
In other subfolders we have construction sub-contract templates providing for payment in instalments and more robust templates for larger projects.
Lump Sum Payment Sub-Contracts is part of Property. Just £38.50 + VAT provides unlimited downloads from Property for 1 year.
Frequently Asked Questions
I want to pay my subcontractor a single sum when the job is done. Which agreement fits? +
A lump sum sub-contract with payment on completion. It suits small projects and any trade, and provides for one payment once the works are finished. Some versions let you hold a retention. Descriptions of the main contract works and the sub-contract works are inserted, with a completion timescale and the day-to-day obligations of both parties.
Can I hold back some money in case defects show up later? +
Yes, through a retention. Some of these sub-contracts let you keep back a percentage of the price and release it once the defects liability period has passed, provided the subcontractor has put right any defects. Retention is a contractual arrangement, not a statutory right, so it only applies if the sub-contract says so. Set the percentage and the release point clearly.
Even on a lump sum job, do I still have to give a payment notice? +
Yes. The Housing Grants, Construction and Regeneration Act 1996 requires a payment notice within five days of the payment due date stating the sum due and the basis for it. If you want to pay less than the notified sum you must serve a pay less notice before the final date for payment. Miss both notices and you must pay the sum the subcontractor applied for.
What if we disagree about whether the work is actually complete? +
Either party can refer the dispute to adjudication at any time under the Housing Grants, Construction and Regeneration Act 1996, and the adjudicator normally decides within 28 days. That is usually faster and cheaper than court for a completion or payment dispute on a small job. Keep dated records, photographs and any snagging list to support your position.
