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INTRODUCTION

The Civil Contractors Federation has developed the following guidance material to assist plant owners and contractors when calculating their own plant hire rates.

The terms used and the examples provided are by way of guidance only. The final determination of plant hire rates to be applied by contractors must be made by the hirer and the owner of the equipment involved.

Owners should always use their own plant costs, variable overheads and operating costs to calculate rates that are specific to their own plant and equipment. Accessory items, such as Excavator Breakers, should also be costed into contractor-specific rates.

The method of calculation given in the example can be used to arrive at a rate, which will cover costs plus a margin for profit. Such a rate will not necessarily be obtainable at all times in the market, but if lower rates are accepted, their relation to actual costs should be understood.

When calculating rates for certain types of equipment, the following parameters should be taken into consideration, ie economic life and annual usage of the machine, maintenance, fuel and other costs. These may or may not be appropriate in any particular case but can be varied as specific to operations. The following pages contain a sample of a calculation and explanatory notes for a total cost formula for use by civil earthmoving contractors.

The calculations shown in this formula were arrived at by CCF on the basis of representative experience. No provision for GST has been made in these calculations.

For any contractor or any other person to enter into any agreement, undertaking or concerted action with one or more contractors or persons in adhering to the rates shown in this compilation may be a violation of the Trade Practices Act.

CONDITIONS OF HIRE

The following conditions are the basis of services and/or machines with operators or the use of unmanned plant. The OWNER should draw the attention of the HIRER to these conditions and obtain their acknowledgment to the conditions before work commences.

To avoid disagreements and disputation, the rental terms should be agreed upon prior to rental. Especially where larger equipment is involved, the terms should be spelt out in a written agreement signed by both parties.

Travelling Time

1. Rubber tyred plant to be charged at full rates one way, or two ways by negotiation.

2. Tracked or floated plant by negotiation, transport charges to USER’S account.

Loading and Unloading

3. The OWNER shall be responsible for unloading and reloading at site and any driver/operator or other person supplied by the OWNER shall be deemed to be under the OWNER’S control.

Driver/Operator

4. Where the OWNER supplies a driver or operator, they shall be a capable and experienced person and shall be duly licensed to operate the machine in accordance with any statute or by-law.

Handling of Plant

5. When a driver or operator is supplied by the OWNER to work the plant, they shall be under control of the OWNER. Such drivers or operators should for all purposes in connection with their employment in the working of the plant, be regarded as servants or agents of the OWNER.

6. The USER shall not allow any other person to operate such plant without the OWNER’S consent in writing.

7. The USER shall apply adequate supervision at all times. Permits and License Fees

8. The USER shall be responsible for obtaining the necessary permit and/or plans and pay such fees as may be required by the public authority for the location and marking of all services, shall expose all such services, and shall conform with the requirements of all by-laws and regulations.

9. The USER shall observe and comply with all statutory obligations and by-laws or regulations imposed by any public authority for the safety of persons and/or property and shall indemnify the OWNER for any liability caused by failure to so comply.

Damage to Existing Services

10. The USER shall be responsible for any damage, which may result to services not properly located, marked or adequately Breakdowns

11. When the plant is used without the OWNER’S driver or operator, (see Clause 6), any breakdown or the unsatisfactory working of any part must be notified immediately to the OWNER. Any claim for breakdown time will only be considered from the time and date of notification.

12. No charge will be made to the USER for any stoppage due to the breakdown of plant caused by the development of any inherent fault or fair wear and tear and for all stoppages for normal running repairs in accordance with the terms of the contract.

13. The USER shall be responsible for all expense involved arising from any breakdown and all loss or damage incurred by the OWNER due to the USER’S negligence, misdirection or misuse of the plant, whether by the USER or his servants, and for payment at the appropriate idle time rate during the period the plant is necessarily idle due to such breakdown. The OWNER will be responsible for the cost of repairs to the plant involved in breakdown from all other causes and will bear the cost of providing spare parts.

14. The OWNER accepts no liability, responsibility for any consequential loss or damage due to or arising from the breakdown or stoppage of the plant through any cause whatsoever, or through non-arrival arising from accident or breakdown or circumstances beyond the control of the OWNER.

Delivery in Good Order and Maintenance (Inspection Reports)

15. Unless notification in writing to the contrary is received by the OWNER from the USER in the case of plant supplied either with or without a driver or operator, within two (2) working days, of the plant being delivered to the site, the plant shall be deemed to be in good order in accordance with the terms of contract and the USER’S satisfaction, provided that where plant is required to be erected on site, the period above stated shall be calculated from the day of erection of the plant instead of the date of delivery on site. The USER shall be responsible for its safe-keeping, use in a workmanlike manner within the manufacturer’s rated capacity and return on the completion of the work in equal order (fair wear and tear excepted).

16. The USER shall, when using plant (see Clause 6) without the OWNER’S driver or operator, take all responsible steps to keep himself acquainted with the state and condition of the plant and shall notify the OWNER without delay of any suspected fault or malfunction.

17. Where the machine becomes bogged because of the USER’S instructions, the OWNER shall receive full rates and any costs incurred for repairs and towage.

18. In the event of the USER wishing to place the machine on standby, the USER must notify the OWNER as soon as possible. The OWNER retains the right to divert the machine to another site or job. Charges

19. Rates and conditions of use of plant/machines are as nominated by the OWNER from time to time and are payable on completion of job or as negotiated.

Insurance

20. The USER shall at all times exercise due care that the plant and/ or machine is not being driven or operated by any person not duly authorised under all relevant laws, by-laws and regulations to be driving or operating such plant or machine for the purpose of which it is being used. The USER shall take responsible precautions to prevent bodily injury or damage to property and to comply with all statutory obligations and by-laws and regulations imposed by any public authority for the safety of persons and property as though he were the owner.

21. The OWNER reserves the right that if, in the opinion of the operator, it would be dangerous or detrimental to the plant, the operator can refuse to operate the plant under such conditions and shall, if a dispute arises, report back to the OWNER for instructions. The operator has no authority to accept liability on behalf of the OWNER under any circumstances whatsoever.

22. The OWNER is responsible to effect all necessary statutory insurances.

23. Sub-hiring of equipment is not permitted without the OWNER’S permission.

24. No claims will be recognised after 7 (seven) days from the signing of this docket. Supplier must be notified of any claims within 7 (seven) days.

ADDITIONAL CONDITIONS

1. Exclusive Service and Not a Hiring Arrangement

The conditions of use are made on the understanding that the plant manned by the OWNER or his driver or his operator remains under the control of the OWNER and that the operation of that plant is an exclusive service.

2. Minimum use

Air Compressors – Minimum time 8 hours Rubber Tyred Equipment – Minimum time 6 hours Tracked Equipment, Large – Minimum time 8 hours.

3. Overtime

Additional to standard rate at current rates. Overtime rates, shift or special allowances are not included in the hire rate calculations.

4. Ground Engaging Tools

Hire rates include normal wear and tear on ground engaging tools and are exclusive of hard rock or abrasive materials.

5. Quotations

All quotations given by the OWNER will be valid for a period of 30 days.

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