Terms & Conditions
The Subcontractor agrees the following terms and conditions are incorporated by reference into all subcontracts between it and the Contractor:
1. All Work performed by Subcontractor shall comply with all applicable federal, state, and local laws, codes, ordinances, regulations, and orders of any public authority. This includes OSHA (or state equivalent) and equal employment opportunity requirements. Subcontractor shall not discriminate against any person. Subcontractor shall schedule, coordinate, pay for, and attend all inspections related to its Work and required by any federal, state, or local authority.
2. Subcontractor is responsible to Contractor for its labor relations and for the acts of its employees and lower-tier subcontractors and suppliers. Subcontractor shall ensure labor harmony with regard to all its activities.
3. Subcontractor is solely responsible for the safety of all its and its subcontractors’ and suppliers’ activities. Subcontractor and its subcontractors and suppliers shall institute and maintain an active written safety program, including a hazard communication program; cooperate with Contractor regarding safety; and take all necessary precautions to ensure the safety of its employees and those near the Project who may be affected by its activities. This safety program must be kept on-site and be available for review at all times. Subcontractor shall also, upon request, provide a Project-specific safety plan and hazard analysis. The Contractor’s review of Subcontractor’s safety program does not limit the Subcontractor’s sole responsibility for the safety of its activities, nor does it indicate the Contractor has assumed any responsibility for the safety of Subcontractor’s Work. The Subcontractor shall designate a safety representative "competent person." Subcontractor shall immediately advise Contractor of any injury to persons or damage to property occurring on the site and shall promptly provide Contractor with a detailed written report of the incident. Subcontractor shall furnish the Contractor with copies of all MSDS information required for the Project, and Subcontractor’s competent person shall complete a jobsite orientation with Contractor prior to starting any Work. Employees of the Subcontractor and its subcontractors shall comply with all federal, state, and local safety standards, the Contractor’s and Owner’s safety rules, and general trade or industry safety practices. Employees of the Subcontractor shall possess all necessary safety training and personal protective equipment. Certification of training shall be made available for the Contractor’s verification.
4. Subcontractor shall hold weekly safety meetings as required in the Contractor’s Safety Orientation Checklist and shall provide written evidence of the meetings upon request. Subcontractor’s failure to comply with any safety obligation is a material breach of this subcontract.
5. Subcontractor warrants and guarantees all Work shall: (i) be free from defects in workmanship and material; (ii) be performed in a good and workmanlike manner; (iii) strictly conform to the requirements of the Contract Documents; (iv) meet or exceed the requirements of the Contract Documents; and (v) be suitable and fit for the purpose intended.
6. Subcontractor shall immediately remove and correct, at its cost, all non‐conforming or deficient Work. Subcontractor’s warranty shall extend two years from the date the Project receives its Certificate of Occupancy or for the duration set by the Contract Documents, whichever is longer.
7. Subcontractor is responsible for the delivery, protection, and storage of tools, equipment, and material needed for the Work. Subcontractor’s delivery and storage of tools, equipment, and material shall not impede the Project, and therefore Contractor retains the right to approve or dictate delivery time and storage locations.
8. Subcontractor bears the risk of loss to its Work until all of its Work has been either: fully completed in accordance with the Contract Documents, put to its intended use by the Owner, or accepted by the Owner, whichever comes first. However, Subcontractor may recover for loss to its Work to the extent permitted by the Contract Documents or by an applicable Builders Risk insurance policy. If another subcontractor damages Subcontractor’s Work, Contractor will endeavor to hold the responsible party accountable.
9. Subcontractor shall take all necessary precautions to protect the work and materials of other subcontractors and of the Owner. Subcontractor shall be solely responsible for all costs relating to or arising from harm it causes to them.
10. Subcontractor shall keep the Project free and clear of debris and waste generated by its activities. In the event Subcontractor fails to do so, Contractor may clear the waste and debris, and Subcontractor will immediately pay all costs incurred by Contractor, or Contractor may deduct all costs associated with cleanup from payments due to Subcontractor.
11. Subcontractor shall perform the Work in accordance with Contractor’s schedule and all updates to it. If a detailed schedule for the Work has not been established, Subcontractor shall commence performance of the Work upon Contractor’s written direction and shall perform the Work diligently and promptly in order to complete it in accordance without delay.
12. Time is of the essence. Subcontractor’s delay in performing the Work is a material breach of the Contract Documents. Subcontractor shall coordinate its Work with that of the Contractor, other subcontractors, and the Owner, so as not to delay the Project. Subcontractor’s exclusive remedy in the event its Work is delayed or interfered with due to any cause, whether by Contractor, Owner, separate subcontractor, or agent of any of them, is an extension of time, unless Owner pays additional compensation to Contractor related to the delay.
13. Subcontractor will pay all costs incurred by Contractor as a result of Subcontractor’s delay in the progress of the Work. If Contractor determines Subcontractor has fallen behind schedule or is in danger of falling behind at its then‐current rate of progress, or if Subcontractor is responsible for any delays to the Project, Contractor may direct Subcontractor to take steps at Subcontractor’s expense that Contractor deems necessary to improve the rate of progress of the Work, such as requiring Subcontractor to work overtime, to increase its labor force and/or number of shifts, or to provide additional equipment or materials. Additionally, within 48 hours of written notice from Contractor, Subcontractor shall submit for Contractor’s approval a recovery plan by which Subcontractor will attain an acceptable rate of progress. Subcontractor will implement the recovery plan immediately upon Contractor’s approval of it. If Contractor determines Subcontractor’s recovery plan will not attain an acceptable rate of progress, Subcontractor will implement the steps Contractor directs at Subcontractor’s cost. In the event Subcontractor fails to submit an acceptable recovery plan or fails to follow a recovery plan it previously submitted, the Contractor may implement its remedies for default and collect the cost of doing so from Subcontractor.
14. Contractor may issue a written notice to Subcontractor that adds to, reduces, suspends, or otherwise changes the scope of Work or the schedule for the Work’s performance. The Subcontractor will implement such written direction without delay. The Subcontractor will not perform any extra or changed Work without a written order from Contractor to do so. Subcontractor waives all claims for extra compensation if it performs extra or changed Work without such written direction from Contractor.
15. If Subcontractor encounters a hazardous or differing condition it will immediately stop Work in the affected area, provide the Contractor with detailed written notice of the condition and its impact on Subcontractor’s Work, and refrain from disturbing the condition until Contractor provides direction. Subcontractor waives and releases all claims related to a condition for which Subcontractor has not provided a detailed written notice within five days of discovery or within five days of the date Subcontractor should reasonably have discovered it.
16. If any unforeseen condition or Contractor‐directed change affects the Subcontract Price or the schedule of performance of the Work, or if Subcontractor becomes aware of any circumstances or conditions it believes will affect the Subcontract Price of performance of the Work, Subcontractor shall submit a written request to Contractor for a subcontract change order.
17. Subcontractor’s request for change order shall include sufficiently detailed documentation to enable Contractor and Owner to determine the facts and circumstances underlying the requested change in price or schedule. All changes in price or schedule related to the change shall also be included.
18. Subcontractor’s request for a change shall also comply with all requirements of the Contractor’s contract with Owner and shall be furnished to Contractor at least two days before the date Contractor must submit a requests for a change to the Owner or by the 20th day of the applicable billing month, whichever is earlier.
19. In no event shall Subcontractor submit any request for a change related to or arising from a condition or event that Subcontractor has been aware of for more than five calendar days or that the Subcontractor itself caused. If Subcontractor fails to provide a properly supported request for a change in the time required, the Subcontractor shall be deemed to have waived all claims related to or arising from such condition or event.
20. Following receipt of a Subcontractor’s complete and timely request for a change, Contractor may issue a written change order to Subcontractor adjusting the Contract Documents either: (i) as requested by the Subcontractor, or (ii) if the Contractor disagrees with the extent of the adjustment requested, on terms Contractor deems to be equitable. Subcontractor shall thereafter perform the Work in accordance with the change order, subject to the dispute resolution provisions of the Contract Documents.
21. Subcontractor shall not suspend or delay its performance of the Work while its change requests are being reviewed or during any phase of dispute resolution. The Contractor will continue to make payments in accordance with the Contract Documents of amounts not in dispute.
22. If the Subcontractor defaults on a requirement of the Contract Documents or is unable to carry out the Work in a prompt and efficient manner, the Contractor may give Subcontractor written notice of default and demand the Subcontractor to cure it. If the Subcontractor fails to cure the default within 48 hours of Contractor’s notice, the Contractor may take any action necessary to effectuate the cure. Remedies the Contractor may implement include, but are not limited to: (i) supplementing Subcontractor’s forces and/or performing a portion of the Work; (ii) terminating the Subcontractor’s right to perform all or part of the Work; and (iii) taking possession of the Work and Subcontractor’s material and equipment at the Project site. The Subcontractor shall pay the Contractor for all costs and liabilities the Contractor incurs as a result of Subcontractor’s default, including attorney and professional fees. Contractor may deduct these costs from payments due to Subcontractor on this and on other Projects.
23. The Contractor may terminate this Subcontract for convenience. Upon receipt of a notice of termination, whether for cause or convenience, the Subcontractor shall immediately terminate all commitments with third parties in connection with the Work. In the event the Subcontract is terminated for convenience, Contractor’s sole obligation shall be to pay Subcontractor in accordance with the Contract Documents for Work properly completed and for costs that are directly related to Subcontractor’s termination and approved by Contractor. Subcontractor hereby specifically waives any lost profits.
24. Subcontractor shall, to the fullest extent permitted by law, indemnify, defend and hold harmless Contractor and Owner from and against all damages, actual or claimed, involving the following: (a) injury or death to any person, or damage or destruction to any property, or any other damage or loss by whomsoever suffered, resulting from or arising from the Work, whether or not such damage or loss is partially due to the negligence on the part of the Contractor or Owner; (b) any failure of Subcontractor or the Work to comply with the requirements of the Contract Documents; (c) any lien, claim, security interest or other encumbrance made or filed against the Work or Project and arising from or related to Subcontractor’s Work; and (d) any hazardous material, waste, toxic substance, pollution or contamination brought to or generated on the Project by the Subcontractor or any of its subcontractors or suppliers. The foregoing obligations of Subcontractor shall not be affected or limited in any way by any insurance.
25. Contractor and Subcontractor mutually waive claims against each other for consequential damages arising out of or relating to the Contract Documents, including claims for office expenses, overhead, loss of financing, loss of bonding capacity, business and reputation, and lost profits. Notwithstanding the foregoing, Contractor shall not waive any claims against Subcontractor which result from a claim by Owner against Contractor under the terms of the Contractor’s contract with Owner.
26. Provided Contractor has paid Subcontractor amounts due under the Contract Documents, Subcontractor’s failure to pay its subcontractors and suppliers for the labor and materials they provide for the Work is a material breach of this Subcontract.
27. Claims and disputes between Contractor and Subcontractor shall be resolved first by a meeting of the respective owners of Contractor and Subcontractor. In the event the parties are unable to resolve the claim or dispute, the parties agree to submit it to non‐binding mediation in accordance with the Construction Industry Mediation Rules of the American Arbitration Association (AAA). Thereafter, any remaining claims and disputes shall be litigated in Oakland County, Michigan, it being acknowledged and agreed by Subcontractor that it does business in Oakland County, Michigan or has otherwise purposely availed itself of the laws of Oakland County, Michigan so as to specifically consent to jurisdiction in Oakland County, Michigan. Notwithstanding the foregoing, at Contractor’s sole and exclusive option, any claims, disputes, or controversies between the parties arising out of or relating to the Contract Documents may be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the AAA then in effect. In the event Contractor elects to arbitrate rather than litigate, the award of the arbitrator(s) shall be final and binding upon the parties without the right of appeal to the courts. Judgment may be entered upon it in accordance with applicable law by any court having jurisdiction thereof. Any arbitration pursuant to this section may be joined or consolidated with an arbitration involving another person or entity (i) necessary to resolve the claim, dispute, or controversy, or (ii) substantially involved in or affected by such claim, dispute, or controversy. In the event a Court of competent jurisdiction determines that Contractor’s option to elect arbitration is unenforceable, then the Contractor’s election of arbitration shall be null and void, and all disputes between the parties shall be subject to litigation in Oakland County, Michigan.
28. Subcontractor shall attend all Project meetings upon notice from Contractor.
29. Subcontractor shall appoint an on‐site foreman and/or superintendent who is reasonably acceptable to Contractor. Upon notice of Contractor’s objection to the foreman and/or superintendent, Subcontractor shall immediately appoint a new foreman and/or superintendent, and in no event later than 48 hours after Contractor’s objection. The Subcontractor waives any increase to the Subcontract Price and schedule for the Work arising from or related to the replacement of a foreman and/or superintendent, it being agreed no additional monies and additional time are warranted.
30. Subcontractor shall furnish all submittals, shop drawings, designs, calculations, catalog cuts, as‐built drawings, operations manuals, and written warranties in accordance with the Contract Documents, with Contractor’s As‐Built Drawing Policy dated 2/14/17, and, if requested, electronically on media acceptable to the
Contractor. Approval of Subcontractor’s submittal does not constitute approval of its Work or of a deviation from the Contract Documents.
31. Subcontractor grants to Contractor a transferable, irrevocable, duty‐free, and perpetual license to retain and use any information it provides to Contractor for any
purpose in connection with the Project or the Owner’s business. Subcontractor warrants and represents that any item described above does not infringe on any patent copyright, trademark or other intellectual property right.
32. To the extent required by the Owner, Subcontractor hereby agrees that if the Owner audits Contractor, Subcontractor shall agree to the same type of audit to substantiate Subcontractor’s invoices on the Project.