What is general terms of contract?

General terms of contract (also known as general conditions of contract) are standardized contractual clauses that define the rights and obligations of the client and contractor in construction projects. They provide a consistent legal framework that covers key aspects such as scope of work, payment, liability, and dispute resolution.

Application

General terms of contract form the legal backbone of construction agreements and are used across residential, commercial, and public building projects. They typically cover the following areas:

Scope and execution: The general conditions specify how construction work must be carried out, which quality standards apply, and how practical completion and handover are handled. They also include provisions on warranties, defect liability periods, and insurance requirements.

Payment terms: The conditions regulate progress payments, payment deadlines, retention amounts, and procedures for handling variations and change orders. Clear payment terms help prevent disputes between parties.

Dispute resolution: Should disagreements arise between client and contractor, the general terms provide mechanisms for resolution, such as mediation, adjudication, or arbitration.

Internationally recognized standard forms include the FIDIC conditions (used widely on international projects), the JCT contracts (common in the United Kingdom), and the AIA contracts (used in the United States). In the Netherlands, the UAV 2012 serves a similar purpose, while Germany uses the VOB/B.

For homeowners and self-builders, understanding which general conditions apply to your contract is essential. These terms significantly affect your rights regarding defects, delays, and payment obligations.

Related terms

• Construction contract
• Specifications
• Variation order
• Practical completion
• Defect liability period

Want to learn more about construction terms? Visit our knowledge base at fredsdiyplans.com.