What are latent conditions in a contract?

Latent conditions are physical conditions on, underlying or adjacent to the site that could not be identified by the contractor by reasonable observations or investigations of the site or the site information provided in the tender documentation at the time that the tender for the works was being prepared.

What is latent condition?

A latent condition is a physical condition on or near the site that could not reasonably have been anticipated by a competent contractor at the time of tendering.

What is variations in a contract?

What is variation? In simple terms, a contract variation occurs when the parties agree to do something differently from the way they originally agreed, whilst the remainder of the contract otherwise operates unchanged. Such an agreement, if valid, would amount to a variation of the existing contract.

What is the difference between variation and additional work?

Since variations are so diverse, external factors typically beyond the control of any of the parties cause variations too, like new authority requirements, etc. In simple terms, Extra work can be defined as work that is totally independent of the contract and not envisaged by the parties at the time of the contract.

What is a latent condition example?

What constitutes a latent condition will vary depending upon the site in question. Examples of latent conditions you may encounter on a site include hidden utility services such as power and drainage lines (if not shown on tender documents), mine shafts and soil contamination.

What are latent conditions and active failures?

Active failures are the acts or conditions precipitating the incident situation. Latent conditions can lead to latent failures: human error or violations. Latent failures may occur when several latent conditions combine in an unforeseen way.

What is a variation in legal terms?

It is common in commercial contracts to include a provision that any changes made to a contract are ineffective unless made in writing and signed by or on behalf of both parties. This is known as a variation clause, and is intended to prevent informal or inadvertent oral variations.

How do you manage variations in a project?

Companies need to be far more prudent with their finances and this article considers five ways that variation orders in construction projects can be managed.

1. Plan in advance.
2. Check the figures as often as possible.
3. Monitor sub-contractor behaviour.
4. Be prepared for late costs.
5. Don’t presume variations will deliver a profit.

Is weather a latent condition?

For example, the definition of ‘latent condition’ in clause 25.1 of AS 4000 refers to physical conditions, including artificial things but excluding weather conditions.

What is the difference between active and latent error?

Active failures are errors and violations having immediate negative results and are usually caused by an individual. Latent failures are caused by circumstances such as scheduling problems, inadequate training, or lack of resources which results in an active failure.