The Simple Construction Agreement is designed for use in the Indonesian construction industry where parties require a clear, legally compliant but uncomplicated framework for construction projects. It is particularly suited for small to medium-sized construction works where the full complexity of a major construction contract is unnecessary. The agreement incorporates essential requirements from Indonesian construction law, including Law No. 2 of 2017 on Construction Services and Government Regulation No. 22 of
2020, while maintaining accessibility for regular business use. It covers fundamental aspects such as scope definition, payment terms, timelines, and quality standards, making it suitable for projects like small commercial buildings, residential constructions, or basic renovation works. The document serves as a balanced instrument protecting both the property owner's and contractor's interests while ensuring compliance with local building regulations and construction standards.
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1. Parties: Identification of the contractor and the client/owner, including their complete legal names, addresses, and registration details
2. Background: Brief context of the construction project and the purpose of the agreement
3. Definitions: Key terms used throughout the agreement defined for clarity and consistency
4. Scope of Work: Detailed description of the construction work to be performed, including general specifications and standards
5. Contract Price and Payment Terms: Agreement on the total contract price, payment schedule, and payment conditions
6. Timeline and Completion: Project schedule, completion date, and any milestone deadlines
7. Contractor's Obligations: Key responsibilities of the contractor including quality standards, safety measures, and compliance requirements
8. Client's Obligations: Key responsibilities of the client including site access, permits, and approvals
9. Materials and Equipment: Provisions regarding procurement, quality, and responsibility for construction materials and equipment
10. Variations: Process for handling changes to the scope of work and associated cost implications
11. Warranties and Defects: Contractor's warranties and obligations to rectify defects during the defect liability period
12. Termination: Circumstances under which either party may terminate the agreement and the consequences
13. Governing Law and Dispute Resolution: Specification of Indonesian law as governing law and method of resolving disputes
14. General Provisions: Standard contract clauses including notices, assignment, and entire agreement
1. Insurance: Detailed insurance requirements when project size or complexity requires specific coverage
2. Performance Security: Requirements for performance bonds or bank guarantees for larger projects
3. Intellectual Property: IP rights provisions when custom designs or innovative construction methods are involved
4. Environmental Compliance: Specific environmental obligations for projects with significant environmental impact
5. Force Majeure: Provisions for handling unforeseen circumstances, particularly relevant in areas prone to natural disasters
6. Subcontracting: Rules and conditions for subcontracting when the contractor may need to engage subcontractors
7. Health and Safety: Detailed health and safety requirements for complex or high-risk construction projects
1. Schedule 1: Scope of Work Details: Detailed technical specifications, drawings, and construction requirements
2. Schedule 2: Bill of Quantities: Itemized list of materials, quantities, and prices
3. Schedule 3: Project Timeline: Detailed project schedule including milestones and completion dates
4. Schedule 4: Payment Schedule: Detailed breakdown of payment installments and milestone payments
5. Schedule 5: Site Details and Access: Information about the construction site, access points, and any site-specific requirements
6. Schedule 6: Required Permits and Approvals: List of necessary permits, licenses, and approvals required for the project
7. Appendix A: Technical Drawings: Construction drawings and technical specifications
8. Appendix B: Quality Standards: Applicable quality standards and testing requirements
Relevant legal definitions
Clauses
Relevant Industries
Real Estate
Construction
Infrastructure
Commercial Property
Residential Property
Industrial
Retail
Hospitality
Healthcare
Education
Manufacturing
Warehousing
Religious Institutions
Relevant Teams
Legal
Operations
Procurement
Project Management
Construction
Facilities Management
Risk & Compliance
Property Development
Commercial
Technical Services
Engineering
Contract Administration
Relevant Roles
Property Developer
Construction Manager
Project Manager
Facilities Manager
Contract Administrator
Site Manager
Procurement Manager
Legal Counsel
Risk Manager
Operations Director
Development Manager
Building Surveyor
Quantity Surveyor
Architect
Civil Engineer
Commercial Manager
Construction Site Supervisor
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