The journey of a self-build is fraught with many complexities and challenges from conception to completion, and it’s up to you and your team to keep things running smoothly. One of those team members may need to take up the role of a Contract Administrator. A role that is not essential to every project but is crucial when required.
‘What is a Contract Administrator?’ and ‘Do I need a Contract Administrator?’ are two questions we hear a lot from new self-builders. There’s not a lot of information out there, and we intend to change that. In this article, we’ll break down the role and responsibilities of a Contract Administrator in a self-build project.
WHAT IS A CONTRACT ADMINISTRATOR?
The Contract Administrator is a nominated individual, within a standard construction contract, who is responsible for not only executing and managing the contract but also preparing, negotiating, and reviewing contracts you may wish to enter into. This is someone who is usually appointed by the client (referred to in most contracts as the ‘Employer’) and they play a crucial role in reducing the potential for a dispute and ensuring that the project meets the quality standards that have been agreed to. The Contract Administrator occupies a dual role, acting as the agent of the employer and equally at times the decision-maker between the employer and contractor. A Contract Administrator will usually be appointed by the employer. However, when exercising this latter role of decision-maker where the Contract Administrator is required to give an assessment or make decisions, they must act independently.
It should be known when negotiating and tendering for main contractors that a standard form of construction contract is going to be administered. It is advisable to appoint a Contract Administrator as early in this process as possible. It can help to ensure that the contract documentation is clear and detailed, making it more suitable for the parties entering into an agreement. The clearer the details are set out, the lower the risk for both the clients (employer) and main contractors.
Here are a few examples of what the role of the Contract Administrator might include:
- Preparing the contract documents for execution.
- Administrating the change control procedures set out within the contract.
- Ensuring the project documentation is issued to the relevant parties.
- Review interim evaluations, assess and decide whether the value requested is accurate and appropriate and then issue instructions for that payment to occur.
- Preparing and issuing a schedule of defects
- Administrating completion procedures, for example, issuing the final completion certificate.
To summarise, the contract administrator is the individual responsible for overseeing the creation, negotiation and execution of a contract.
WHO CAN BE THE CONTRACT ADMINISTRATOR?
In theory, the role of Contract Administrator can be undertaken by a range of individuals. This could include architects, engineers, building surveyors, quantity surveyors or any agent of the employer (including project managers). An ideal candidate should, however, hold the relevant experience and have a working knowledge of the inner workings of accountancy, workmanship, construction detailing and legal jargon.
In self-build projects, the Contract Administrator role is usually given to the project architect, and there are a few reasons for this:
- The architect has a familiarity with the construction details
- The architect has a close enough relationship with the employer to have an in-depth knowledge of their requirements, enabling them to act as their agent.
- The architect has the training to be able to review valuations that come in from the contractor or quantity surveyor.
- They have a professional obligation to provide an unbiased view and exercise independent judgement to undertake the dual role required.
It’s important to note that we do NOT recommend you as the self-builder take up the role of Contract Administrator. The Contract Administrator has a responsibility to be impartial, and some construction contracts even express provisions precluding such individuals from acting as Contract Administrator.
It’s also worthwhile hiring a solicitor or an individual well-versed in contract law to look over everything if you’re unsure, especially if a bespoke form of contract is to be entered into.
DO I NEED A CONTRACT ADMINISTRATOR?
The role is only essential where one's named in a contract, and in most standardised contracts, a Contract Administrator will be listed. Additionally, a Contract Administrator should always be listed in the traditional contracts that are non-bespoke. This would include all SBCC contracts for Scotland, JCT for the rest of the UK and architectural professional bodies such as the RIBA also have a catalogue of standardised contracts.
In a project that does not utilise a traditional construction contract, a different role can be filled under a different name, such as a specialist consultant to the client or an employer’s agent. Either way, an agreement must be made to allow the individual on-site and negotiate with the other parties involved. The terms of engagement agreed with your architect should outline whether it is a service they are offering to undertake and define whether it would be solely within the use of a standardised contract or something more bespoke, acting as your ‘Employers Agent’.
WHAT IS THE DIFFERENCE BETWEEN THE PROJECT MANAGER AND THE CONTRACT ADMINISTRATOR?
A lot of confusion arises amongst new self-builders about the differences between the roles of project manager and Contract Administrator. The roles have key differences, and it’s important to know them.
The Contract Administrator is someone who is administrating and managing elements within the contract only. For example, a timeline can be established for the project and construction. The contract administrator would be able to determine who is at fault if an event caused the contractor to fall behind the agreed schedule and would administer the procedures in place to compensate those affected by the delay. However, the contract administrator is not responsible for delivering specific items to the site at the required time to adhere to the specified timeline.
A project manager (PM) is a person who can oversee the planning and delivery of the construction process, from initial design to finished product on behalf of their client. Essentially, they assist in the procurement of your project. This role can be filled out by the self-builder, or a hired professional. If you decide to manage your own project, you’ll be the one responsible for managing the project timelines and budget. A hired professional can alleviate a lot of the associated stress and time that comes with a construction project, but they come with their own professional fees.
You can find out more about the role of the Project Manager here:
- How to Be Your Own Project Manager
- The Importance of A Project Manager – An Interview With Samuel James Project Management
The project manager can work closely with the Contract Administrator within the parameters of the contract, as they can assist in the preparation of the employer’s requirements at the tendering stage, and contribute to the preparation of the contract documentation by providing a ‘schedule of works’ (if not provided by the main contractor). If you’re hiring a professional PM, it’s best to bring them in, again, as early as possible.
Another reason we do not recommend the self-builder takes on the Contract Administrator role is the practicalities that come with being both the employer and contract administrator in a contract. This can significantly increase risk and be legally complex. Also, as mentioned earlier, it is important to be competent and have the relevant knowledge and experience suitable for undertaking the role.
CAN AN INDIVIDUAL BE THE PROJECT MANAGER AND THE CONTRACT ADMINISTRATOR?
Yes, an individual can be both the project manager and the Contract Administrator. However, they must have the competency, professional knowledge and experience to do both, and the two roles are two of the biggest undertakings on a project.
It would require an incredibly large amount of time and dedication to cover both roles, and a professional PM with the additional role under their belt would most likely come with higher fees.
AC Architects recommend taking enough time to carefully consider who to appoint for these roles, as they can be pivotal in the successful execution of your project. If both the Contract Administrator and project manager roles are undertaken by appointed professionals, this can allow the self-builder to focus on the more creative and personal aspects of their new home. They are tough jobs, so it's important to get them done right!
