Construction agreement: the clauses to check before you sign
On your checklist as: “Agreement check passed”
Payment tied to measurable work, a delay clause, a defect liability period, warranty terms, controlled brand substitution and a bounded escalation clause - verified present before you sign, while asking still costs nothing.
What to look at
- Each clause present or its absence noticed
- The dispute-resolution mechanism named, not assumed
How to check it yourself
The clauses that carry the risk: scope and drawings incorporated by reference; payment linked to measurable stage completion; delay and liquidated damages; defect liability period; warranties, especially waterproofing; brand-substitution control; price-escalation bounding; scope-change and extra-work pricing mechanism; termination; dispute resolution, typically arbitration under the Arbitration and Conciliation Act 1996; and taxes stated inclusive or exclusive. Where a clause is silent the Indian Contract Act 1872 supplies defaults, including s.73 damages for breach — a poor substitute for express terms.
Where this comes from: Indian Contract Act 1872 s.73; Arbitration and Conciliation Act 1996; Advocates Act 1961 ss.29, 33; Bar Council of India v. A.K. Balaji (2018) 5 SCC 379 (required by law)
More construction agreement checks before you sign
- Contractor background verified
- Site handover checklist agreed
- Worker-welfare rules applicability checked
- GST treatment understood before signing
- The payment schedule keeps money back until the end
- The agreement does not contradict itself
- GST is stated, and you know who pays it
- You know who you are contracting with
- Price escalation has a limit you can calculate
- Foundation extras cannot be open-ended
- Curing is the contractor's job, in writing
- The arbitrator is not chosen by the contractor alone
- There is a warranty, and it has a length
- Worker safety stays with the contractor
- Signing for a stage does not sign away everything after it
- There is a way to settle a dispute short of court
- Cancellation terms are not written by one side
- Nobody else builds your house without you knowing
- No blank spaces, no missing dates
- Money goes to the company, not to a person
- You can ask where the money went
- Delay has a consequence for both sides
- The quotation is attached to the agreement
- Force majeure is not a blanket excuse
The whole stage: Construction agreement checks before you sign