Agreement of Project Management
THIS AGREEMENT OF PROJECT
MANAGEMENT made at
_____________ this _______ day of __________ in the Christian Year Two Thousand
________.
BETWEEN
A. B. ENTERPRISES, a registered
Partnership Firm through its Partners (1) ABC, and (2) XYZ, having its
registered office at _________________________________________________,
hereinafter called “THE OWNERS” (which expression shall unless contrary
to the context or meaning, thereof mean and include its successors and assigns)
of the ONE PART; AND EXCLUSIVE SERVICES
LIMITED, a Public Limited company
incorporated under the Companies Act, 1956 having its registered office at
________________________________________ represented by its Chairman and
Managing Director PQR, hereinafter called “THE PROJECT MANAGERS” (which
expression shall unless it be repugnant to the context or meaning thereof be
deemed to mean and include its successors and assigns) of the OTHER PART;
WHEREAS :–
(a) The
Owners are well and sufficiently entitled to and are seized and possessed of
all the ownership right, title and interest in the immovable property more particularly described in the SCHEDULE
hereunder written and which property is hereinafter referred to as “the
said Property”. The said property
stands in the name of the Owners in the relevant Government records and the
Owners are fully entitled to deal with and develop the said property. The said property is occupied by several
tenants and occupants.
(b) The
Project Managers have the relevant and required skills and expertise in
development of immovable properties including expertise in construction,
financial management, marketing etc;
(c) The
Owners are desirous of entrusting to the Project Managers the works relating to
the development of the said property to be carried out for and behalf of the
Owners namely works relating to planning, making arrangements for required
finances, designing, construction and sale of constructed premises in buildings
to be constructed on the said property (hereinafter referred to as the “PROJECT”)
on turnkey basis and the Project Managers have agreed to accept such
appointment and to manage the affairs of development of the said property for
and on behalf of the owners by providing their services on the terms and
conditions recorded in this agreement.
NOW THIS AGREEMENT WITNESSETH and it is hereby agreed and
recorded by and between the parties hereto as follows:—
1. The
Owners declare and confirm as under:—
(a) The
Owners are well and sufficiently entitled to the said property and that their
title to the said property is free and marketable subject to the rights of
existing tenants/occupants.
(a) No
other person except the Owners have any right, claim or demand in respect of
the said property or any part thereof;
(b) The
Owners have not created any charge, lien or encumbrance by way of sale, gift,
mortgage, lease or any other third party
rights on the said property. The said property is not subject to any claim or
demand, encumbrance, attachment or any process issued by any Court or Authority
and the title of the said property is not under any lispendens.
(d) The
Owners have not entered into any arrangement
with any one for development or sale of the said property.
(e) No
Notice from any authorities or under any statute has been served upon the
Owners in respect of the said property which restricts or may restrict the
development of the said property.
2. The
Owners hereby appoint and authorize the Project Managers to act as their “Turnkey
Project Managers and Consultants” for development of the said property and
the Project Managers hereby accept such appointment upon the terms and
conditions appearing hereinafter.
3. RESPONSIBILITIES,
DUTIES AND OBLIGATIONS OF THE PROJECT MANAGERSS
3.1 To
arrange and provide required finance for the project from its commencement till
its completion and to carry out construction of all buildings including
buildings for rehabilitation of Tenants/occupants. This finance shall be on
account of the Owners. This finance shall be provided by the Project Managers
either by arranging part sales of the premises of the new construction at the
rates agreed with the Owners or by raising loan from financial
institution/banks. If such finance is arranged from any financial
institution/bank, the Owners agree to pay interest on the same.
3.2 To
deal with all and any Government, Semi-Government, Municipal and other concerned local authorities and
agencies for obtaining requisite
permissions, approvals, sanctions etc. for commencement and completion
of the project.
3.3 To
totally plan and design the entire project and to get work executed as per the
sanctioned drawings.
3.4 To
carry out planning, designing, preparation of layout plans, and construction of
buildings including planning of various project related amenities as a Housing
Complex and including construction of buildings for rehabilitating
Tenants/occupants.
3.5 To pay
and deposit on behalf of the Owners amounts towards
fees/charges/deposits/premiums etc. and to receive refund of the same.
3.6 To pay
on behalf of the Owners for all the material required and used for construction
in the project.
3.7 To
appoint Architects, Engineers, R.C.C. consultants, Managers, Works Supervisors,
Staff etc.
3.8 To
arrange execution of the soil investigation work from parties specialized in
the field.
3.9 To
survey the site including planning, designing and preparation of preliminary
architectural drawings for the Project and getting the same approved from the
Owners and their Architects.
3.10 To
prepare preliminary cost estimate of the Project including of land development
works like roads, footpaths, compound wall, water supply, sewerage, storm water
drainage and electrification.
3.11 To
Plan, design and prepare the architectural and structural drawings.
3.12 To
prepare the tender documents comprising the technical specification, General
Terms and Conditions, Special Conditions etc. for inviting tenders.
3.13 To
invite tender from its registered contractors/short-listed contractors or by
open tendering as per norms of tendering by following rules and procedure.
3.14 To
evaluate the tenders and to award the works to contractors in consultation with
the Owners.
3.15 To pay
on behalf of the Owners for the labour and manpower in the form of
Contractor/s.
3.16 To
prepare estimates of cost of the various items of work.
3.17 To
submit to the Owners periodically (every month but not later than once in three
months) statement of expenditure on the project duly certified by its
representative. On completion of all
works of the project, the accounts of the work shall be closed and a final
statement thereof shall be submitted for determining the total cost of the
Project and to be audited by a mutually agreed Chartered Accountant.
3.18 To
make payments towards the project expenditure which shall be made by transfer of
funds in a separate bank account to be opened in any Bank in the name of the
Owners and earmarked for the project.
3.19 To its
best endeavor to reduce the cost of construction by any change of
specifications, method of construction, value engineering or any innovative or
economical design. Such reduction in the cost of construction to be made
without affecting/prejudicing or endangering in any way the safety or security
of the buildings constructed in the project.
3.20 To be
fully responsible for the quality and structural safety of the construction.
The Project Managers shall make their Contractors responsible for rectification
of any defects within the warranty period, which shall be for a period of 12
months from the date of handing over of any buildings and amenities of the
project. The Project Managers will make provision in agreement with the
contractors that the Security Deposit of
the Contractor shall be refunded only after expiry of warranty period and rectification
of defects period.
3.21 To remain
responsible for proper structure, workmanship and liability for defects of the
building constructed by it for a period of twelve months from the date of
completion of project.
3.22 Any
defect discovered and brought to the notice of the Project Managers during the
period aforesaid shall be rectified forthwith by Project Managers through the
concerned contractor or by themselves at their own cost and expense. Upon such
failure on part of the Project Managers, without prejudice to any other rights
available to them in law, and after due notice to the Project Managers, the
same shall be rectified by the Owner for
and on behalf of and at the cost and expense of the Project Managers. The Owner
shall have the right to deduct or set off the expenses so incurred by it from
or against any amount due and payable or to become due and payable or to the
Project Managers under this agreement or to claim the same from them.
3.23 The
Project Managers, unless otherwise specified shall be fully responsible for
procurement of all required material and services for construction and
completion of the project as contemplated herein.
3.24 The
Project Managers shall be fully responsible for observance and compliance of
all labour and other laws applicable to the project and shall indemnify and
keep indemnified the Owner against effect of any non-observance of any such
laws.
3.25 At the
end of the project, any surplus item, material, or goods for which payment has
been made on account of the Owners, shall be disposed off by the Project
Managers at mutually agreed price and amount credited to Owners. The Project
Managers shall also clear the site of their materials etc. within one month
from the date of completion of the Project failing which the Owners shall
dispose it off in the manner deemed fit by the Owners.
3.26 To do
in the name of the Owners all acts necessary and incidental to the commencement
and successful completion of the project within the stipulated time.
3.27 The
Project Managers shall take all major decisions with the prior consent of the
Owners.
4. RESPONSIBILITES
AND OBLIGATIONS OF THE OWNERS
4.1 To make
available the site for construction of
individual buildings of the project free of all encumbrances.
4.2 To
extend full co-operation to the Project Managers and render assistance in
obtaining all permissions and sanctions required for development of the project
as may be requested by Project Managers.
4.3 To
execute a limited Power of Attorney in favour of the Project Managers to do and
perform all acts on their part as envisaged hereunder.
5. COMPLETION
OF THE PROJECT
5.1 The
Project, subject to (i) force majore and circumstances beyond control of the
Project Managers; (ii) dispute or challenge to the Owner’s title to the said
property by any third party; (iii) stop work Notice from any Governmental,
Municipal (Building Proposal) Dept. or Revenue and other Statutory bodies; and
(iv) injunction from any Court, shall be completed in all respects within a
period of ___ months from the date specified in Clause 5.2 below.
5.2 The
date of start of the work shall be reckoned from the 15th day after the date of approval of Building plans by the local authorities and
granting permission for commencement of the work.
6. FEES
OF THE PROJECT MANAGERS
Out of the
total gross project realizations/sale proceeds of the constructed premises, the
Project Managers shall be entitled to receive the following:-
(a) Fees of
______% (________ percent only) of total gross realizations to arise from the
sale of “free sale areas” of the Project as their charges/fees for project
management, consultancy, supervision and for services rendered.
(b) The
gross sale proceeds shall not include the amounts collected/received from the
purchasers of constructed premises towards share-money; society formation
charges, taxes and maintenance charges; legal fees; deposits; stamp duty and
registration charges; club membership charges; charges in respect of general
amenities of the complex or cost of additional and extra work to be carried out
for the Purchasers of premises.
7. In
consideration of their appointment as Project Managers and receiving
charges/fees as aforestated, the Project Managers on execution hereof shall
deposit a sum of Rs. ______________/- (Rupees ____________________ only) as a
refundable security deposit with the Owners for due performance of the
obligations of the Project Managers under the present contract. The said
security deposit shall be refunded by the Owners to the Project Managers
without any interest once the complete development of the said project
including total sales is over.
8. 8.1 The Agreements for Sale of the constructed
premises in the buildings shall be made and executed in the name of the
Owners. All net sale proceeds
realized/received from time to time under such agreements (pending the final
accounts) shall be applied and appropriated as follows:—
(a) _______%
thereof shall
be transferred to development account for utilization
towards cost of development of the Project and repayment of funds raised and
interest thereon.
(b) _______%
thereof shall be transferred to the
“Owners Bank account” for use by the Owners.
(c) _______%
thereof shall be transferred to the
Project Managers to be applied towards payment of part of their agreed fees.
8.2 All the sale proceeds shall be first received
and deposited in Owners main bank account. The funds from the main account
shall be disbursed in the proportions mentioned in Clause 8-1 above. A separate
bank account under the name of “Development Account” shall be opened in the
name of the Owners and shall be operated by the Owners. From the “Development
Account” amounts shall be disbursed as per Clause 8-1 above.
8.3 The final accounts shall be arrived at
within____months from the date of completion of the project.
9. Timely
completion of the entire development is essence of agreement. In the event, for any reason whatsoever, if
the Project Managers fail or neglect to complete the construction work as
provided in clause ______ hereinabove, in that event the Owners themselves,
after expiry of the stipulated period and after giving 60 days notice to the
Project Managers, would be entitled to takeover the project and to complete the
remaining construction on their own or by appointing any other agency.
10. It is
the intention of the parties hereto that by executing this presents, the Owners
are not transferring or intending to transfer to the Project Managers the
ownership or possession of the property or any part thereof to the Project
Managers. This Agreement is also not a
lease nor an agreement to sell the said property nor it is intended to give
possession of the said property to the Project Managers u/s 53-A, of the Transfer of Property Act,
1882. It is agreed and expressly
clarified that bare permission and licence will be given to the Project
Managers to enter upon the said property for the construction of the building
and development of the said property and for sale of flats, shops and parking
spaces and other areas by marketing for on behalf of the owners as provided
herein above.
11. The
provisions herein do not constitute any Partnership and/or joint venture
between the parties hereto. The
appointment of Project Managers is strictly as “Project Managers and
Consultants” only by the Owners for the development of the said property and
does not in manner create any right, title or interest in favour of the Project
Managers in the said property nor does it make them Co-owners in the said
property. Each of the parties shall remain liable to pay and discharge their
respective tax liabilities arising on their share of
profits/remuneration/income from the project. Each of the parties shall bear
and pay the professional charges of their respective legal advisors.
12. The
Project Managers shall not assign the benefit of this Agreement to any
one without the previous written consent of the Owners.
13. Any
disputes, differences or non performance or non-payment between the Owners and
the Project Managers arising under this agreement, shall be referred to
arbitration under the provisions of Arbitration and Conciliation Act, 1996.
Such Arbitration shall be held at_______.
THE SCHEDULE ABOVE REFERRED TO:
(Description of the said property)
In
witness whereof the
parties hereto have hereunder affixed their respective hands and seals the day
and year hereinabove.
SIGNED
AND DELIVERED BY THE )
withinnamed
OWNERS A. B. )
ENTERPRISES
by its partners )
(1) ABC
and (2) XYZ )
in the
presence of …….. )
THE
COMMON SEAL of the withinnamed )
EXCLUSIVE
SERVICES LIMITED )
was
hereunto affixed pursuant to )
the
Resolution of its Board of Directors )
passed
in that behalf on the _________ )
day of
___________ 200_ by its )
Chairman
and Managing Director PQR, )
in the
presence of ………… )
DATED THIS
DAY OF _______, 200__
M/S. A. B.
ENTERPRISES ..OWNERS
A N D
EXCLUSIVE SERVICES LIMITED
……PROJECT MANAGERSS
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