The project management consulting contract is extremely necessary in the process of improving both the work quality and schedule of the project. There are two methods for project management consulting activities: establishing a project management consulting board or hiring a project management consultant. Should you opt for external project management, the project management consulting contract will bind both parties.
So, how does the law regulate project management consulting contracts? Next, NPLAW will address this question for the customer.
The project management consulting contract is extremely necessary in the process of improving both the work quality and schedule of the project. There are two methods for project management consulting activities: establishing a project management consulting board or hiring a project management consultant. Should you opt for external project management, the project management consulting contract will bind both parties.
So, how does the law regulate project management consulting contracts? Next, NPLAW will address this question for the customer.
I. Understanding about project management consulting contracts
A construction project that aims to be completed both in terms of work quality and schedule needs to have a plan. Therefore, project management consulting is necessary. Project management consulting activities can be carried out by the investor, establishing a project management consulting board, or hiring project management consultants. When hiring project management consultants, both parties will negotiate with each other and establish a project management consulting service contract.
The project management consulting contract targets activities related to project management consulting. Project management consulting includes activities such as planning, organizing, managing, and supervising the development process of the project... All aimed at ensuring that projects are completed on time and within the approved budget. At the same time, to ensure quality and achieve the specific goals of the project.
II. Legal regulations on project management consulting contracts
1. What is a project management consulting contract?
A project management consulting contract can be understood as an agreement between the investor and the contractor, who is the project management party, whereby the contractor will provide project management consulting services to the investor, and the investor will pay the consulting fees to the contractor.
Project management consulting is understood as the consultant assisting the investor in project management, including several specific contents:
- Contribute ideas, advise the contractor to manage the capital tightly and effectively.
- Professionally carry out the tasks assigned by the investor, such as management or supervision.
- Resolve legal issues related to the construction process (land clearance, resettlement, ...).
- Inspection and supervision of work after construction and completion: quality assessment, final account, auditing, etc.
2. The necessary contents of a project management consulting contract
The current Project Management Consulting Service Contract template is implemented according to the template issued with Official Document 99/BXD-KTTC in 2008 regarding the announcement of the Project Management Consulting (PMC) contract template issued by the Ministry of Construction.
Accordingly, the project management consulting contract includes the following contents:
+ Contract dossier and order of priority.
+ Description of the scope of work.
+ Contract price, advance payment, and settlement.
+ Contract performance guarantee (if any).
+ Change and adjust the contract price.
+ Contract execution schedule.
+ General responsibilities and obligations of the PMC.
+ General rights and obligations of the investor.
+ Suspension and termination of the contract.
+ Indemnities and responsibility limits.
+ Copyright and document usage rights.
+ Security.
+ Insurance.
+ Bonuses, penalties for contract violations.
+ Complaints, disputes, and arbitration.
+ Contract settlement.
3. Conditions for the validity of the project management consulting contract
Since the project management consulting contract is a form of civil transaction pursuant to Article 116 of the Civil Code 2015, the conditions for the validity of the project management consulting contract are also the conditions for the validity of the civil transaction.
Accordingly, pursuant to Article 117 of the Civil Code 2015, the conditions for a contract to be valid include:
+ The subjects have civil legal capacity and civil act capacity appropriate to the established contract;
+ The subjects involved in the contract are completely voluntary;
+ The purpose and content of the contract do not violate any legal prohibitions and are not contrary to social ethics.
Note: Pursuant to the consolidated Document Decree No. 02/VBHN-BXD dated July 20, 2018, of the Ministry of Construction on construction investment project management, organizations participating in project management consulting activities must meet the conditions corresponding to the competency classes: Class I, Class II, and Class III.
III. Some questions about project management consulting contracts
1. Is it necessary to regulate competency certificates in the project management consulting contract?
According to the current Project Management Consulting Service Contract Template implemented under Circular 99/BXD-KTTC in 2008 regarding the announcement of the Project Management Consulting (PMC) contract template, the contract must clearly regulate that PMC personnel must possess professional certificates, qualifications, skills, and experience appropriate and commensurate with their profession and work as specifically outlined in Appendix No. … [PMC Personnel].
Thus, it is necessary to regulate competency certificates in project management consulting contracts.
2. Cases where project management consulting contracts are invalid
The project management consulting contract is invalid if it falls under the cases of civil transactions being invalid from Article 123 to Article 133 of the Civil Code 2015. Specifically, it includes the following cases:
+ The subject lacks civil legal capacity and civil act capacity appropriate to the established civil transaction.
+ The subjects involved in the civil transaction are not fully voluntary.
+ The purpose and content of the civil transaction violate the prohibitions of the law and are contrary to social ethics;
+ The form of the contract does not comply with legal regulations in cases where the law regulates that the form of the contract is a condition for the contract's validity.
3. In what cases do disputes over project management consulting contracts arise?
Disputes over project management consulting contracts occur in the following cases:
+ Disputes over contract price, advance payments, and settlements;
+ Dispute over the schedule of contract execution;
+ Dispute over information security, copyright;
+ Dispute over performance guarantee of the contract;
+ Dispute over the scope of project management tasks.
To ensure the schedule of building the project, quality, as well as an effective project management consulting contract based on the investor's requirements, and to minimize contract disputes, the contract must meet the following conditions:
+ The contract will ensure the recognition of the agreements of the signing parties on a voluntary basis, without violating the law;
+ The content has been drafted based on the needs and desires of the parties involved;
+ The parties will be bound and must fulfill their obligations to ensure the rights of the parties.
