ABSTRACT
This chapter takes a less conventional approach to describing contracts, with the emphasis on risk. Unfortunately much of the literature describing contract types is misleading and some erroneous. The existing literature places great emphasis on describing contracts by their broad payment terms and sometimes by how they are organized. In contracts, risk is expressed by who suffers the financial consequences of a risk event or performance failure. At one end of the contract spectrum the contractor provides services to perform work with minimal or no definition. The contractor is reimbursed the cost of the work carried out, but accepts no responsibility a reimbursable or cost plus profit basis for the contract. The contractor may be responsible for all aspects of schedule, cost and quality control, but if they are reimbursed at an agreed rate for all man-hours used then the client is in effect assuming all of the risk.
