Are you a state government department or public body which procures public construction works and services? Are you in the process of determining which form of contract will be most appropriate for your procurement to issue to tenderer? Do you have a precedent construction contract or consultant agreement?
On 1 July 2018, new Ministerial Directions and Instructions for Public Construction Procurement were released. They comprise the mandatory requirements for Victorian public construction and prescribe, amongst other things, the form of contract that agencies should be using.
WHAT FORM OF CONTRACT CAN I USE?
Agencies are required to use Victorian Public Construction Contracts that are in a form approved by the Secretary to the Department of Treasury and Finance (DTF). A list of those contracts can be found here.
CAN I USE ANOTHER CONTRACT?
The Ministerial Guidelines and Instructions recognise that there may be situations where a Victorian Public Construction Contract may not be suitable for use. In those circumstances, agencies may use an amended form of one of the Victorian Public Construction Contracts or an alternative form of contract if one or more of the following applies:
- a Victorian Public Construction Contract is inappropriate for the works that are being procured
- there may be significant interface issues as a result of multiple contractors working on a site or where works are undertaken on an operational site and the Victorian Public Construction Contracts do not address these issues
- the works or services being procured relate to leased premises or third party property which require a lessor or third party’s approval on the form of contract.
The relevant agency will also be required to provide a copy of the form of contract that has been issued to tender to the DTF with details of the circumstances which applied for a non-Victorian Public Construction Contract being used within 30 days of the issuing of a tender.
CAN I STILL USE A “PRECEDENT” FORM OF CONTRACT EVEN THOUGH IT IS NOT A VICTORIAN PUBLIC CONSTRUCTION CONTRACT?
If your agency has been using its own form of “precedent” contract which is not listed in the link above, it may still use that contract under the “transitional provisions” if you:
- ensure the contract is compliant with all policy and legislative requirements
- either publish a copy on the agency’s website or make a copy available by request (by advising the details of the relevant contact person)
- by no later than 30 September 2018, provide either a copy of the contract (if not published) or a link to the contract (if published on the website) to the DTF that the contract is being used under the transitional provisions.
If agencies wish to use an existing precedent contract on an ongoing basis, they will be required to submit to the DTF a copy of the contract in a template form and provide a description of the typical commercial positions adopted in the variable items and schedules. The DTF will then assess this contract and either add this contract to the suite of Victorian Public Construction Contracts (with or without amendment) or choose to retire the contract.
Maddocks has advised a broad range of State Government agencies regarding the Victorian Public Construction Contracts. If you would like more information, contact Maddocks on (03) 9258 3555 and ask to speak to a member of the Construction and Projects team.
|Billy Gialamas | Associate
T +61 3 9258 3002