Contract administration ensures that the supplier conducts the work or service stated in the contract, while the buyer conforms to their requirements included in the contract. If there is more than one contract involved with the project then a key integration task is to manage the various interfaces within the project.
The activities undertaken as part of contract administration can involve the following (see also Figure 12.3):
Figure 12.3. Contract administration activities involved to meet contractual requirements
If the work performance information identifies that the seller is failing to meet their contractual requirements, and corrective actions are not able to resolve the issue, the termination clause within the contract could be invoked. For a less severe matter, the contract could be amended by joint consent, although this must occur before contract closure. The change control process would need to be followed for an amendment to the contract, but the instigation of this process could add cost to buyer or seller, depending on the contractual terms and conditions. If either party disagrees with the requested change, there may be the need to resort to the claims administration procedure, as stated in the contract. If the differences cannot be resolved within the terms of the contract, the dispute resolution procedure is the only course open for arbitration or litigation, and the only winners in this case are the solicitors.
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