Common Contracts
1 similar Lump Sum Construction Contract contracts
Lump sum construction contract exampleLump Sum Construction Contract • June 5th, 2023
By Yash Baheti and Daniel GrayLast Updated May 25, 2023A lump sum contract provides a fixed price for completing a construction project. Also called a stipulated sum contract, this type of construction agreement provides simplicity for both owners and contractors, and it’s often used for projects with a clear scope of work.Below, we’ll look closely at how lump sum contracts work, lump sum contract examples, and the pros and cons of lump sum contracts.A lump sum contract is an agreement that sets a predetermined cost for construction work. In other words, the contractor performing the work agrees to complete the project for a fixed amount — no more or less. Notably, that contract amount is tied to a specific scope of work, so contractors are not obligated to perform work above and beyond the original agreement. It's important for projects using lump sum agreements to have a well-defined scope of work. Without a clear scope, owners could face unexpected costs or contractors may face disp
