Pre-construction services agreements
Pre-construction services agreements

The following Construction practice note provides comprehensive and up to date legal information covering:

  • Pre-construction services agreements
  • What is a pre-construction services agreement?
  • Essential elements
  • Services
  • Payment
  • Termination
  • Proceeding to the building contract
  • Other key issues
  • Timing
  • Standard forms

Pre-construction services agreements

This Practice Note explores the use of pre-construction services agreements (PCSAs) which are typically used in two-stage tendering.

Construction projects are often procured using a two-stage approach, which is very different from the traditional single stage tender method. Rather than asking contractors to submit a bid for the works in a competitive tender process and proceeding to enter into a contract with the selected contractor, many employers (although still opting to use a traditional or design and build lump sum contract) are choosing to negotiate with contractors and to use their expertise at an early stage in the procurement process. This alternative process is generally referred to as two-stage tendering (see Practice Note: What is two-stage tendering?). The services to be carried out by a contractor up until the building contract is entered into and the contractual arrangement between the parties is typically governed by a PCSA—sometimes also called a preliminary contract.

What is a pre-construction services agreement?

A PCSA is, in effect, an interim contract that fills the legal gap until a building contract can be entered into. As the use of two-stage tendering has increased, so has the use of PCSAs, which have evolved in their scope and complexity. The PCSA should protect the interests of both sides by clarifying the respective duties and entitlements. PCSAs can vary in complexity and the simpler

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