Novation contacts.
Novation contacts.
(OP)
Several months’ back a small local contractor, who had taken over a contract through novation, approached me. He asked me would I be willing to run the contract as his site agent on a water supply contract, after careful consideration and study of the BoQ and specification of the original contractors tender I declined the position and advised the contractor not to sign the final novation contract, but to seek the contract under his own original tender rates.
This he did not do and went ahead and signed it. Last week I heard that he pulled his crew off the contract claiming that the local authority had not been fully forth coming in disclosing the extent of the amount of work that had to be made good such as testing of water mains and the relay off such.
The contractor further claimed that some of the major rates with in the bill were some uneconomical that the original contractor should not have been awarded the contract in the first place.
Has this contractor any redress in now breaking the contract and declaring it null and void or is his bound to honour it and lose his shirt in doing so?





RE: Novation contacts.
I’m sorry that should be Novation Contract.
RE: Novation contacts.
TTFN
RE: Novation contacts.
RE: Novation contacts.
What is a Nonvation contract anyway?
P11100
RE: Novation contacts.
RE: Novation contacts.
Anyway, as you might suspect, novations, as with buying a house can go either way. Our production contracts have been cash cows, but our development contracts have been sinkholes. This is typical, though, since development contracts are almost always bid aggressively and optimistically.
TTFN
RE: Novation contacts.
Hope this answers your question.
Novation is a contractual device whereby, with a client's express approval, a new contractor steps into the shoes of an insolvent contractor. In effect, the new contractor purchases the interests in the project and, for a consideration, assumes all the rights, benefits and liabilities of the contract. The completion of the project by novation arrangement enables the client to continue the project without any additional costs. However, this is possible only where the novation agreement clearly makes the new contractor liable for the following:
General making good of defects (patent and latent, if applicable) in the works.
Carrying out all emergency work
Rectification of any damage (deterioration or act of vandalism) resulting from the determination.
Responsibility for the time lost between the determination and recommencement of production.
Arrangement for the assignment of nominated sub-subcontractors / suppliers contracts from the insolvent contractor to the new contractor.