advantages and drawbacks of Contracts Unit 2 Part 6

Que2.25. Explain compactly the procedure ofpre-qualification of  contractors. State its advantages and  downsides. 

Answer  The Prequalification Process 

1. announcement and announcement It’s the employer’s responsibility  to announce the Assignation for Prequalification( IFP) on the ADB website as well as in 

i. A  review of general rotation in the borrower’s country( at least  one English- language  review, if available) 

ii. An internationally known and freely website in English. 

2. Preparing and Issuing a Prequalification Document 

i. The employer is responsible for preparing and issuing the  prequalification document. 

ii. The employer shall use ADB’s Standard Procurement Document for  the Prequalification of stab( SPQD). 

iii. The employer shall prepare the prequalification document using the  published  interpretation of the SPQD without suppressing or adding  textbook to  Section 1- Instructions to aspirants( ITA).  All information and data particular to each individual prequalification  process must be  handed by the employer in the  ensuing sections of  the prequalification document  Section 2 Application Data distance  Section 3 Qualification Criteria  Section 4 operation Forms  Section 5 Eligible Countries  Section 6 compass of Contract 

iv. The employer shall allow  aspirants a  minimal period of 42 days to  Study the prequalification document, b. Prepare complete and responsive  operations, and c. Submit their  operations. 

3. Preparation and Submission of Applications 

i. The  aspirant is solely responsible for the medication and submission  of its  operation. 

ii. During this stage, the employer shall

a. instantly respond to requests for  interpretations from  aspirants and  amend, as  demanded, the prequalification document; and b. Amend the prequalification document only with the  previous  blessing of  ADB. 

4. Opening and Evaluation of operations 

i. The employer shall appoint  educated staff to conduct the evaluation  of  operations. 

ii. miscalculations committed at evaluation may  latterly prompt complaints from   aspirants,  takingre-evaluation of the  operations, with consequent  detainments and waste of  coffers. 

iii. The employer, in observance of stylish practices, shall a. Maintain strict confidentiality throughout the evaluation process, b. Reject any attempts or pressures to distort the  outgrowth of the  evaluation, including fraud and corruption,

c. rigorously apply only and all of the qualification criteria specified in  the prequalification document; and  Notify all  aspirants in jotting of the names of those  aspirants  who have been prequalified. 

5. streamlining and evidence of endeavor’s Qualifications  Information pertaining to a  endeavor’s eligibility, pending action, and   fiscal situation shall be  streamlined during bidding. 

ii. fresh qualifying conditions not examined during  prequalification  similar as  fiscal  coffers and current contract commitments.  outfit to be allocated for the particular contract.  labor force to be  contended  for the particular contract. 

Advantages  Enhances participation of serious contractors( since unqualified  stab  are  barred). 

ii. Reduces high cost of bidding. 

iii. Gives early warning of competition  eventuality.  iv. Reduces complaints of disqualified  stab.  Gives “ Peace of Mind ” to Employers.  vi. Borrower  suitable to assess interest of  good  enterprises. 

vii. Identifies implicit conflict of interest( contractors with business  association with advisers ).  viii. Reduces time in  assessing  flings from unqualified  stab.  ix. Reduces implicit for contestation.  Early Discovery of Employer’s capacity to manage procurement. 

Disadvantages  Increases procurement lead time. 

ii. Review of all  operation is  obligatory whereaspost-qualification  requires review of only winning  shot. 

iii. Possibility of  conspiracy. 

Que2.26. What are complementary  pledges in a contract? How their  nonfulfillment to breach of contract? bandy it with a many practical   exemplifications. 

Answer  Complementary Promises  Promises which form the consideration or a part of consideration for  each other are called complementary  pledges. 

ii. An agreement may  correspond of either 

a. A  pledge supported by consideration given, or 

b. A  pledge supported by another  pledge. 

iii. In the  ultimate case, when an agreement is supported by another  pledge,  it will be a complementary  pledge. 

iv. therefore, in complementary  pledges each party gives a  pledge for a  pledge.  Complementary  pledges are of the following types  collective and Independent Complementary Promises When each party  performs his  pledge  singly and irrespective of the fact whether  the other party has performed, or is willing to perform his  pledge or  not, the  pledges are  collective and independent.  illustration X agrees Y to supply milk daily, while Y agrees to pay the  price of milk every month. Both these are  collective and independent   pledges. 

ii. tentative and Dependent Complementary Promises When the  performance of a  pledge by one party depends upon the  previous  authorization  of the other party, it’ll be a  tentative and dependent  pledge.  Example X promises to construct Y’s house,  handed that Y  inventories  cement and bricks. This will be a  tentative and dependent  pledge.  Then, X need not perform the  pledge if Y fails to supply cement and  bricks. 

iii. collective and Concurrent or contemporaneous Complementary Promises  This is the state when two contracts are to be performed  contemporaneously.  illustration All cash deals are  exemplifications of  contemporaneous or concurrent   pledges, as delivery of goods and payment of price take place   contemporaneously. 

Breach of the Contract Breach is non-fulfilment of an agreed   pledge under the contract  similar as  Not handing over the assignment mentioned in the contract on quested  timelines. 

ii. Not furnishing the applicable document to the  pledge for making the  payment. 

iii. Not making payments on time as per the contract for work done.  iv. Not  attesting to the schedule mentioned in the contract.  Not completing the  workshop as per  mileposts mentioned in the contract. 

Que2.27. What’s the purpose of retention  plutocrat? When  payments may be made at reduced rate? How and by whom are the  reduced rates determined? 

Answer  Retention Money It’s an  quantum held back from a payment made  under a construction contract. It’s  generally a chance( 5) of the   quantum outstanding of each  investiture. It’s generally held to  insure that  a contractor performs all of its  scores under the contract, and is   also released  moreover on practical completion or after the end of a  blights   announcement period.  Purpose of Retention Money 

1. In general, Retention Money provides protection to the employer.  Retention  plutocrat gives the idea of  significance of completing the  inked   design as per its terms and designs. 

2. With  similar retention held, the contractor takes the responsibility to  complete the construction  design as per the design and quality stated in  the  original contract.  Condition for Reduced Rate If the contractor fails to carry out the  work  rigorously in  agreement with the  delineations and specifications, and, if  in the opinion of the  mastermind, the work is structurally sound, he may  accept the work, but the contractor will be paid at reduced rates which  will be decided by the  mastermind.  Example Assume that the specification for teak wood panelled  windows and doors mentions that the consistence of the shutters should  be 4 cm and if the shutters actually  handed by the contractor are only  cm thick, the  mastermind may accept the work and reduce the rate per  square metre of the shutters by an  quantum equal to the reduction in the  cost of the accoutrements  used in the work.  

Que2.28. Define and  bandy the  significance of the following 

1. humorless  plutocrat.

2. Security deposit. 

3. conservation liability period of contract. 

4. Debitable agency.

5. Registration of contractors and suppliers by  negotiating  departments. 

Answer  1. Earnest Money  Earnest  plutocrat is an assurance or guarantee on the part of the contractor  to keep the offer for consideration and to confirm his intention to take  up the work if accepted in his favour for  prosecution as per terms and  conditions in the tender. 

2. Following are the  significance of  humorless  plutocrat  Compensation In case, the contractor refuses to take up the work or  runs down when his tender is accepted, the work can be  distributed to the  next  smallest  endeavor.

The  humorless  plutocrat ropped compensates the loss  of  proprietor/ department to a great extent. 

ii. discipline In case the contractor quotes lower rate without intention  of doing the work, the  humorless  plutocrat shall be ropped as a  discipline.  iii. Restriction on gratuitous Competition The provision of  humorless   plutocrat will  circumscribe the entry of  numerous contractors who may not have  enough  coffers to do the work. 

2. Security Deposit 

i. The contractor whose tender has been accepted is to deposit 10 of the   proffered  quantum as security  plutocrat with the department inclusive of  the  humorless  plutocrat  formerly deposited. 

ii. This  quantum is kept as a check so that the contractor fulfils all the terms  and conditions and carries out the work satisfactorily within the  prescribed time limit. , his whole or part of the security  If the contractor fails on is ropped by the department as a  discipline. 

iv. The security  plutocrat also serves as a security against the accoutrements  or  the tools and  ministries  handed by the department to the contractor  on loan. 

3. conservation Liability Period of Contract 

i. The  conservation period is the period following completion of a  construction  design during which the contractor is responsible for certain   conservation issues under the  numerous  structure or engineering contracts. 

ii. During this period, the contractor needs to maintain insurance in force,  the extent of which will depend on the contract and on his own concern  for the  threat he’s facing.

iii. typically the  conservation period will last for twelve months from the  completion of the contract but this may be longer or shorter. 

4. Debitable agency When the contractor fails to fulfill his contractual  obligation in respect of progress or quality of work indeed after being  given due notice by the  proprietor, a debitable agency is appointed. The  charges incurred will be charged from the bills of contractor or security   plutocrat deposited  before. 

5. Registration of Contractors and Suppliers by Engineering  Departments 

i. The contractor and suppliers must get himself registered in the  departments( or Government) for which he’s interested to take up   workshop. 

ii. Government contractors are entitled to do government jobs if awarded. 

iii. Contractors are classified according to the enrollment  and enrollment    freights and depending on this they can  take over works up to certain   quantum.

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