Contract and Project Administration: Procurement, Tendering, Certification and Security of Payment
This domain tests how work is procured and how the architect administers the contract after award: tendering routes, contract documents, securities, certification, variations, time and money, and the statutory adjudication regime for payment disputes.
Procurement and tendering
- Routes: open tender, selective tender with prequalification, negotiated, two-stage, design-and-build, management contracting. Choice turns on time, price certainty, design completeness and risk allocation.
- Documents: invitation and conditions of tendering, form of tender, articles of agreement, conditions of contract, bills of quantities or schedule of rates, specification, drawings, form of performance security.
- Securities: tender deposit, performance bond (commonly 10% of the contract sum in private work), retention (typically 5-10%, half released at completion and half at expiry of the maintenance period, usually 12 months), and parent company guarantees.
- Tender evaluation: compliance check first, then arithmetical check, then qualification and comparison. Never negotiate with a non-compliant tenderer to make the bid compliant; that undermines the process.
Contract administration
- The architect is the client's agent for design and the contract administrator for certification. Certifying functions (payment, extension of time, completion, defects) must be performed honestly and independently, on evidence, within contractual time limits.
- Instructions must be in writing; oral instructions confirmed promptly. Variations are valued by contract rates first, then by fair valuation.
- Extension of time requires notice and substantiation; delay analysis distinguishes critical from non-critical delay and addresses concurrency.
- Records: site diaries, minutes, progress photographs, test certificates and correspondence. A certificate is only as good as the file behind it.
Security of payment
Hong Kong's construction security of payment legislation creates a statutory right to progress payment, a payment claim and payment response cycle, and rapid adjudication that binds the parties until overturned in arbitration or litigation. Serving no payment response is not a safe option.
Worked example
A contractor claims extension of time after the delaying event, for late information, but gave notice 20 days beyond the stated period. First decide whether the contract makes timely notice a condition precedent. If it does, the claim fails on notice even though the delay is real. Answer both limbs expressly: entitlement and time bar.
Traps that cost marks
Certifying before verification; acting as the client's advocate rather than a certifier; ignoring notice provisions; confusing retention with a bond; assuming adjudication replaces arbitration; recommending a tenderer who qualified its bid.