Agreement of Project Management

THIS AGREEMENT OF PROJECT MANAGEMENT made at _____________ this

_______ day of __________ in the Christian Year Two Thousand ________.
BETWEEN
A. B. ENTERPRISES, a registered Partnership Firm through its Partners (1) ABC, and (2)
XYZ, having its registered office at
_________________________________________________, hereinafter called “THE
OWNERS” (which expression shall unless contrary to the context or meaning, thereof mean
and include its successors and assigns) of the ONE PART; AND EXCLUSIVE SERVICES
LIMITED, a Public Limited company incorporated under the Companies Act, 1956 having its
registered office at ________________________________________ represented by its
Chairman and Managing Director PQR, hereinafter called “THE PROJECT MANAGERS”
(which expression shall unless it be repugnant to the context or meaning thereof be deemed
to mean and include its successors and assigns) of the OTHER PART;
WHEREAS :–
(a) The Owners are well and sufficiently entitled to and are seized and possessed of all
the ownership right, title and interest in the immovable property more particularly
described in the SCHEDULE hereunder written and which property is hereinafter
referred to as “the said Property”. The said property stands in the name of the
Owners in the relevant Government records and the Owners are fully entitled to
deal with and develop the said property. The said property is occupied by several
tenants and occupants.
(b) The Project Managers have the relevant and required skills and expertise in
development of immovable properties including expertise in construction, financial
management, marketing etc;
(c) The Owners are desirous of entrusting to the Project Managers the works relating
to the development of the said property to be carried out for and behalf of the
Owners namely works relating to planning, making arrangements for required
finances, designing, construction and sale of constructed premises in buildings to
be constructed on the said property (hereinafter referred to as the “PROJECT”) on
turnkey basis and the Project Managers have agreed to accept such appointment
and to manage the affairs of development of the said property for and on behalf of
the owners by providing their services on the terms and conditions recorded in this
agreement.
NOW THIS AGREEMENT WITNESSETH and it is hereby agreed and recorded by and
between the parties hereto as follows:—
1. The Owners declare and confirm as under:—
(a) The Owners are well and sufficiently entitled to the said property and that their
title to the said property is free and marketable subject to the rights of
existing tenants/occupants.
(a) No other person except the Owners have any right, claim or demand in respect
of the said property or any part thereof;
(b) The Owners have not created any charge, lien or encumbrance by way of sale,
gift, mortgage, lease or any other third party rights on the said property. The
said property is not subject to any claim or demand, encumbrance,
attachment or any process issued by any Court or Authority and the title of the
 said property is not under any lispendens.
(d) The Owners have not entered into any arrangement with any one for
development or sale of the said property.
(e) No Notice from any authorities or under any statute has been served upon the
Owners in respect of the said property which restricts or may restrict the
development of the said property.
2. The Owners hereby appoint and authorize the Project Managers to act as their
“Turnkey Project Managers and Consultants” for development of the said
property and the Project Managers hereby accept such appointment upon the
terms and conditions appearing hereinafter.
3. RESPONSIBILITIES, DUTIES AND OBLIGATIONS OF THE PROJECT
MANAGERSS
3.1 To arrange and provide required finance for the project from its
commencement till its completion and to carry out construction of all
buildings including buildings for rehabilitation of Tenants/occupants. This
finance shall be on account of the Owners. This finance shall be provided by
the Project Managers either by arranging part sales of the premises of the
new construction at the rates agreed with the Owners or by raising loan from
financial institution/banks. If such finance is arranged from any financial
institution/bank, the Owners agree to pay interest on the same.
3.2 To deal with all and any Government, Semi-Government, Municipal and
other concerned local authorities and agencies for obtaining requisite
permissions, approvals, sanctions etc. for commencement and completion of
the project.
3.3 To totally plan and design the entire project and to get work executed as per
the sanctioned drawings.
3.4 To carry out planning, designing, preparation of layout plans, and
construction of buildings including planning of various project related
amenities as a Housing Complex and including construction of buildings for
rehabilitating Tenants/occupants.
3.5 To pay and deposit on behalf of the Owners amounts towards
fees/charges/deposits/premiums etc. and to receive refund of the same.
3.6 To pay on behalf of the Owners for all the material required and used for
construction in the project.
3.7 To appoint Architects, Engineers, R.C.C. consultants, Managers, Works
Supervisors, Staff etc.
3.8 To arrange execution of the soil investigation work from parties specialized in
the field.
3.9 To survey the site including planning, designing and preparation of
preliminary architectural drawings for the Project and getting the same
approved from the Owners and their Architects.
3.10 To prepare preliminary cost estimate of the Project including of land
development works like roads, footpaths, compound wall, water supply,
sewerage, storm water drainage and electrification.
3.11 To Plan, design and prepare the architectural and structural drawings.
3.12 To prepare the tender documents comprising the technical specification,
General Terms and Conditions, Special Conditions etc. for inviting tenders.
3.13 To invite tender from its registered contractors/short-listed contractors or by
open tendering as per norms of tendering by following rules and procedure.
3.14 To evaluate the tenders and to award the works to contractors in consultation
with the Owners.
3.15 To pay on behalf of the Owners for the labour and manpower in the form of
Contractor/s.
3.16 To prepare estimates of cost of the various items of work.
3.17 To submit to the Owners periodically (every month but not later than once in
three months) statement of expenditure on the project duly certified by its
representative. On completion of all works of the project, the accounts of the
work shall be closed and a final statement thereof shall be submitted for
determining the total cost of the Project and to be audited by a mutually
agreed Chartered Accountant.
3.18 To make payments towards the project expenditure which shall be made by
transfer of funds in a separate bank account to be opened in any Bank in the
name of the Owners and earmarked for the project.
3.19 To its best endeavor to reduce the cost of construction by any change of
specifications, method of construction, value engineering or any innovative or
economical design. Such reduction in the cost of construction to be made
without affecting/prejudicing or endangering in any way the safety or security
of the buildings constructed in the project.
3.20 To be fully responsible for the quality and structural safety of the
construction. The Project Managers shall make their Contractors responsible
for rectification of any defects within the warranty period, which shall be for a
period of 12 months from the date of handing over of any buildings and
amenities of the project. The Project Managers will make provision in
agreement with the contractors that the Security Deposit of the Contractor
shall be refunded only after expiry of warranty period and rectification of
defects period.
3.21 To remain responsible for proper structure, workmanship and liability for
defects of the building constructed by it for a period of twelve months from
the date of completion of project.
3.22 Any defect discovered and brought to the notice of the Project Managers
during the period aforesaid shall be rectified forthwith by Project Managers
through the concerned contractor or by themselves at their own cost and
expense. Upon such failure on part of the Project Managers, without prejudice
to any other rights available to them in law, and after due notice to the
Project Managers, the same shall be rectified by the Owner for and on behalf
of and at the cost and expense of the Project Managers. The Owner shall
have the right to deduct or set off the expenses so incurred by it from or
against any amount due and payable or to become due and payable or to the
Project Managers under this agreement or to claim the same from them.
3.23 The Project Managers, unless otherwise specified shall be fully responsible for
procurement of all required material and services for construction and
completion of the project as contemplated herein.
 3.24 The Project Managers shall be fully responsible for observance and
compliance of all labour and other laws applicable to the project and shall
indemnify and keep indemnified the Owner against effect of any non-
observance of any such laws.
3.25 At the end of the project, any surplus item, material, or goods for which
payment has been made on account of the Owners, shall be disposed off by
the Project Managers at mutually agreed price and amount credited to
Owners. The Project Managers shall also clear the site of their materials etc.
within one month from the date of completion of the Project failing which the
Owners shall dispose it off in the manner deemed fit by the Owners.
3.26 To do in the name of the Owners all acts necessary and incidental to the
commencement and successful completion of the project within the stipulated
time.
3.27 The Project Managers shall take all major decisions with the prior consent of
the Owners.
4. RESPONSIBILITES AND OBLIGATIONS OF THE OWNERS
4.1 To make available the site for construction of individual buildings of the
project free of all encumbrances.
4.2 To extend full co-operation to the Project Managers and render assistance in
obtaining all permissions and sanctions required for development of the
project as may be requested by Project Managers.
4.3 To execute a limited Power of Attorney in favour of the Project Managers to do
and perform all acts on their part as envisaged hereunder.
5. COMPLETION OF THE PROJECT
5.1 The Project, subject to (i) force majore and circumstances beyond control of
the Project Managers; (ii) dispute or challenge to the Owner’s title to the said
property by any third party; (iii) stop work Notice from any Governmental,
Municipal (Building Proposal) Dept. or Revenue and other Statutory bodies;
and (iv) injunction from any Court, shall be completed in all respects within a
period of ___ months from the date specified in Clause 5.2 below.

5.2 The date of start of the work shall be reckoned from the 15 th day after the
date of approval of Building plans by the local authorities and granting
permission for commencement of the work.
6. FEES OF THE PROJECT MANAGERS
Out of the total gross project realizations/sale proceeds of the constructed
premises, the Project Managers shall be entitled to receive the following:-
(a) Fees of ______% (________ percent only) of total gross realizations to arise
from the sale of “free sale areas” of the Project as their charges/fees for
project management, consultancy, supervision and for services rendered.
(b) The gross sale proceeds shall not include the amounts collected/received from
the purchasers of constructed premises towards share-money; society
formation charges, taxes and maintenance charges; legal fees; deposits;
stamp duty and registration charges; club membership charges; charges in
respect of general amenities of the complex or cost of additional and extra
work to be carried out for the Purchasers of premises.
7. In consideration of their appointment as Project Managers and receiving
 charges/fees as aforestated, the Project Managers on execution hereof shall
deposit a sum of Rs. ______________/- (Rupees ____________________ only)
as a refundable security deposit with the Owners for due performance of the
obligations of the Project Managers under the present contract. The said security
deposit shall be refunded by the Owners to the Project Managers without any
interest once the complete development of the said project including total sales is
over.
8. 8.1 The Agreements for Sale of the constructed premises in the buildings shall be
made and executed in the name of the Owners. All net sale proceeds
realized/received from time to time under such agreements (pending the final
accounts) shall be applied and appropriated as follows:—
(a) _______% thereof shall be transferred to development account
for utilization towards cost of development of the Project
and repayment of funds raised and interest thereon.
(b) _______% thereof shall be transferred to the “Owners Bank
account” for use by the Owners.
(c) _______% thereof shall be transferred to the Project Managers to
be applied towards payment of part of their agreed fees.
—————
    100% TOTAL
—————
8.2 All the sale proceeds shall be first received and deposited in Owners main bank
account. The funds from the main account shall be disbursed in the
proportions mentioned in Clause 8-1 above. A separate bank account under
the name of “Development Account” shall be opened in the name of the
Owners and shall be operated by the Owners. From the “Development
Account” amounts shall be disbursed as per Clause 8-1 above.
8.3 The final accounts shall be arrived at within____months from the date of
completion of the project.
9. Timely completion of the entire development is essence of agreement. In the
event, for any reason whatsoever, if the Project Managers fail or neglect to
complete the construction work as provided in clause ______ hereinabove, in that
event the Owners themselves, after expiry of the stipulated period and after giving
60 days notice to the Project Managers, would be entitled to takeover the project
and to complete the remaining construction on their own or by appointing any
other agency.
10. It is the intention of the parties hereto that by executing this presents, the Owners
are not transferring or intending to transfer to the Project Managers the ownership
or possession of the property or any part thereof to the Project Managers. This
Agreement is also not a lease nor an agreement to sell the said property nor it is
intended to give possession of the said property to the Project Managers u/s 53-A,
of the Transfer of Property Act, 1882. It is agreed and expressly clarified that bare
permission and licence will be given to the Project Managers to enter upon the said
property for the construction of the building and development of the said property
and for sale of flats, shops and parking spaces and other areas by marketing for on
behalf of the owners as provided herein above.
11. The provisions herein do not constitute any Partnership and/or joint venture
between the parties hereto. The appointment of Project Managers is strictly as
 “Project Managers and Consultants” only by the Owners for the development of the
said property and does not in manner create any right, title or interest in favour of
the Project Managers in the said property nor does it make them Co-owners in the
said property. Each of the parties shall remain liable to pay and discharge their
respective tax liabilities arising on their share of profits/remuneration/income from
the project. Each of the parties shall bear and pay the professional charges of their
respective legal advisors.
12. The Project Managers shall not assign the benefit of this Agreement to any one
without the previous written consent of the Owners.
13. Any disputes, differences or non performance or non-payment between the Owners
and the Project Managers arising under this agreement, shall be referred to
arbitration under the provisions of Arbitration and Conciliation Act, 1996. Such
Arbitration shall be held at_______.

THE SCHEDULE ABOVE REFERRED TO:

(Description of the said property)

IN WITNESS WHEREOF the parties hereto have hereunder affixed their respective
hands and seals the day and year hereinabove.

SIGNED AND DELIVERED BY THE )

withinnamed OWNERS A. B. )
ENTERPRISES by its partners )
(1) ABC and (2) XYZ )
in the presence of …….. )

THE COMMON SEAL of the withinnamed )

EXCLUSIVE SERVICES LIMITED )
was hereunto affixed pursuant to )
the Resolution of its Board of Directors )
passed in that behalf on the _________ )
day of ___________ 200_ by its )
Chairman and Managing Director PQR, )
in the presence of ………… )

DATED THIS DAY OF _______, 200__

M/S. A. B. ENTERPRISES ..OWNERS

AND
EXCLUSIVE SERVICES LIMITED
 ……PROJECT MANAGERSS

AGREEMENT OF PROJECT
MANAGEMENT CONSULTANCY