On most construction projects the parties’ contractual agreement addresses who is responsible for keeping the various work areas clean. Generally, those who generate trash on a project must get rid of the trash. Typically, it is the responsibility of the subcontractor to clean up and remove from the jobsite, or place in a dumpster provided by the prime contractor, all trash and debris including scrap materials, waste materials, rubbish, packaging materials, and crates and pallets used to ship materials and fixtures to the project site. Frequently, the subcontract will require the subcontractor to remove all trash and debris resulting from the subcontractor’s work at the end of each work day.
Where a subcontractor fails or refuses to clean up its work areas on a daily basis, the prime contractor may be left with no choice but to perform such work or services and later backcharge the offending subcontractor by deducting the associated costs from the subcontractor’s monthly progress payments. Most construction industry standard form subcontracts address the prime contractor’s right to assess cleanup costs against the subcontractor. For example, form A401-2007, Standard Form of Agreement Between Contractor and Subcontractor, published by The American Institute of Architects (“AIA”), contains the following provisions regarding cleanup.
§ 4.4.1 The Subcontractor shall keep the premises and surrounding area free from accumulation of waste materials or rubbish caused by operations performed under this Subcontract. The Subcontractor shall not be held responsible for conditions caused by other contractors or subcontractors.
§ 4.4.2 As provided under Section 3.3.2, if the Subcontractor fails to clean up as provided in the Subcontract Documents, the Contractor may charge the Subcontractor for the Subcontractor’s appropriate share of cleanup costs.
Oftentimes it is difficult for the prime contractor to determine which subcontractor was responsible for the trash and debris left in the work areas. In such instances, the prime contractor will frequently attempt to apportion the cleanup costs on a pro rata basis among the various subcontractors known to have been working in each area at the time that the trash and debris were left in the affected work area. Subcontractors, however, will frequently challenge a prime contactor’s apportionment of cleanup costs on a pro rata basis. Disputes often arise when the prime contractor simply apportions the cleanup costs without providing the subcontractor with adequate documentation to support the prime contractor’s contention that the subcontractor was responsible for generating the trash and debris removed by the prime contractor.
As written, the language of AIA A401-2007, Sections 4.4.1 and 4.4.2, appears to open the door to permit the prime contractor to charge subcontractors for job site cleanup on a pro rata basis. While Section 4.4.1 suggests that the subcontractor shall not be held responsible for unclean conditions caused by others, it does not clearly preclude the prime contractor’s apportionment of cleanup costs on a pro rata basis. So, how does the subcontractor halt the ability of the prime contractor to backcharge the subcontractor for job site cleanup on a pro rata basis? Subcontractors may want to consider replacing Section 4.4.1 and Section 4.4.2 with the following language:
§ 4.4.1 The Subcontractor shall keep the premises and the immediate work area free from accumulation of waste materials or rubbish caused by operations performed under this Subcontract and shall regularly haul such waste materials and rubbish to trash receptacles provided by the Contractor in convenient locations on the Project premises. The Subcontractor shall not be held responsible for unclean conditions caused by other contractors or subcontractors and shall not be subject to any charge by the Contractor for trash removal or cleanup determined on a pro rata or similar basis.
§ 4.4.2 As provided under Section 3.3.2, if the Subcontractor fails to clean up waste materials or rubbish caused by operations performed under this Subcontract as provided in the Subcontract Documents, the Contractor may charge the Subcontractor for the actual direct costs associated with hauling waste materials and rubbish, caused by operations performed under this Subcontract, to trash receptacles provided by the Contractor under Section 4.4.1.
The foregoing amendments to Sections 4.4.1 and 4.4.2 clarify the respective responsibilities of the parties as well as the subcontractor’s intent that it only be liable for the actual direct cost of cleanup services provided by the prime contractor and not be subject to arbitrary pro rata backcharges.
There are many ways to amend standard form contract agreements to minimize your risk on a construction project and to help you avoid claims and contentious disputes from the outset. The sample provision above is one example. Before simply inserting such sample language into your contracts without further thought, however, it is advisable to consult with a seasoned construction lawyer. A seasoned construction lawyer will be able to assist you in drafting carefully tailored and deliberate revisions to the interrelated boilerplate provisions of your form contracts to advance your overall objectives including shifting or significantly minimizing the risk inherent in every construction project.