Building Agreement Between Owners and Contractor on Fee Plus Cost of Labour and Materials (India)
This template is a formal construction agreement between a property owner and a contractor for building a house on a 'fee plus cost' basis. It outlines detailed responsibilities regarding construction timelines, payment schedules based on architectural certification, liquidated damages for delays, and a twelve-month defect liability period.
Building Agreement between the Owners and The Contractor on Fee Plus Cost of Labour and Materials
This Agreement made at ....................... on this ............. day of
..................2000,
between
Shri........................ S/o .......................
resident of ..............................
(hereinafter called 'the owner' which expression shall unless repugnant to the context or meaning thereof, be deemed to include his heirs, legal representatives, executors and administrators) of the ONE PART and M/s ABC Builders & Contractors, a partnership firm registered under Partnership Act, 1932 and having its registered office at .................. (hereinafter referred to as 'the builders' which expression shall unless repugnant to the context or meaning thereof, be deemed to include every partner for the time being of the said firm, the survivor or survivors or the legal representatives, executors or administrators of the last survivor of the Other Part.
Where as the first party is the owner of the plot of land admeasuring .................... sq. meters bearing plot No. ........... city survey No. ...................... Khasra No. ..................... situate, lying and being at ...................... Tahsil and District ...................... (hereinafter referred to as the "said plot of land") and is desirous of getting a house constructed on the said plot of land.
and Whereas the first party has appointed Shri ................. as the architect and the said architect has prepared the plans, drawings and elevations of the said intended house and the specification of the works to be done and of the materials.
AND WHEREAS the second party is a big contractor and is having vast experience in construction of big buildings and has agreed to construct the house on the said plot of land.
Now it is Agreed by and Between The Parties as Follows:
The builders will construct the building on the said plot of land in conformity with the plans, drawings, specifications and elevations as prepared by the architect which has been annexed hereto and marked as Annexure A, with the material of best quality and in the most substantial and workman like manner and to the satisfaction of the architect.
2. The builders hereby undertake to commence the construction within fifteen days of execution of these presents and complete the construction on or before the expiry of ................... months from the date of execution of these presents in accordance with the plans duly approved and sanctioned by the Municipal Corporation of .................................. and specifications and conditions as are set out in Annexure A hereunder written.
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About this template
What is this template?
This document is a construction services contract where the price is not fixed but based on actual costs plus a markup fee. It contains specific schedules for architectural specifications and progress-based payment stages, distinguishing it from a standard fixed-bid contract.
When should you use it?
Use this document when the final cost of materials is uncertain and the owner agrees to pay a fixed fee over expenses; use a Lump Sum Building Agreement instead if the total price is fixed at the start.
What's inside
| Clause | Name | What it does |
|---|---|---|
| 2 | Contract Price and Fee | Specifies that the Owner pays the Contractor the actual cost of labor and materials plus a fixed fee of [amount]. |
| 3 | Contractor's Duties | Obliges the Contractor to provide all materials and labor according to the specifications in the First Schedule. |
| 4 | Completion Period | Requires the Contractor to complete the building within [number] months from the date of the agreement. |
| 5 | Payment Mode | Establishes a payment schedule based on progress stages as defined in the Second Schedule. |
| 6 | Defects Liability | Requires the Contractor to remedy any defects appearing within [number] months after completion at their own expense. |
| 8 | Arbitration | Mandates that disputes be settled by two arbitrators under the provisions of the Arbitration and Conciliation Act, 1996. |
Who it's for
- an Indian property owner hiring a contractor for residential or commercial construction
- parties using a cost-plus-fee pricing model instead of a fixed-price lump sum
- construction projects requiring detailed progress-based payment schedules
How long it runs and how it's signed
Law it's drafted under
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