The client's project manager and representative

Neither the Law of Obligations Act, the Building Code, the Public Procurement Act nor regulation no 80 on owner's supervision names the project manager. The Building Code (ehitusseadustik, EhS) knows the omanik (the owner) and omanikujärelevalve (owner's supervision), the Law of Obligations Act (võlaõigusseadus, VÕS) the client and the contractor, the Public Procurement Act (riigihangete seadus, RHS) the hankija (the contracting authority). Project manager is a term that comes from practice, as is client's representative, and both take their content from the contract alone.

This differs fundamentally from owner's supervision. Under § 20(1) of the Building Code, owner's supervision is the owner's statutory obligation, whose minimum content is set by regulation no 80. There is no such minimum content for the project manager. What the law requires of owner's supervision and what it does not is covered in the article on the tasks of owner's supervision.

The practical consequence: there are no default tasks. If the contract does not say that the project manager reports a rise in the forecast final cost, the wording of the contract gives them no such obligation. If the contract does not say that they may approve changes, it is unclear whether their consent binds the client.

The type of contract depends on what is agreed, and this article does not decide it. If the project manager undertakes to provide a service in the client's interest, the contract may be a käsundusleping (contract of mandate); if they undertake to achieve an agreed result, it may be a töövõtuleping (contract for work). The type affects which statutory provisions apply as the contract's default rules.

	Contract of mandate	Contract for work
Definition	VÕS § 619: the mandatary provides a service to the mandator	VÕS § 635(1): the contractor makes or alters a thing or achieves “another agreed result” (unofficial translation)
Standard of care	§ 620(1) and (2): loyalty and diligence; a professional acts “at the level of generally recognised professional skills”	conformity of the result with the contract (§ 641)
Personal performance	§ 622: personal performance is presumed, help from a third party is possible	according to the contract
What the client must write	tasks, reporting, powers	the result by which the work is assessed

The same advice applies to both types: write the tasks down expressly. If the contract describes the tasks precisely, the question of type matters less, because in a dispute the contract is read first (VÕS § 29(1): the parties' actual common intention). The contract of mandate standard of care, “at the level of generally recognised professional skills”, is a useful yardstick, but it does not replace a list of tasks.

The biggest risk to the final cost is unclear powers. If the contractor gets oral permission for additional work from the project manager on site, the question arises whether the client has agreed to it. According to the Supreme Court's case-law review, lisatöö (additional work) is work outside the subject matter of the contract which requires an agreement, and without an agreement there is no contractual basis for payment. Who may make that agreement on the client's behalf must be written down. How to tell additional work from muudatustöö (changed work) is covered in the article on additional work and changed work.

Write the authority into both the project manager's contract and the construction contract. In the project manager's contract, it is their obligation and their limit towards the client. In the construction contract, it is information for the contractor: who may give work instructions, who may approve changes and up to what sum. If the contractor does not know the limit of the authority, they may later argue that they had reason to believe the project manager's consent bound the client.

Decision	Typical allocation of authority, chosen by the client
Technical clarification with no price effect	the project manager decides and records it in the diary
A change or additional work priced below the limit set by the client	the project manager approves in writing and informs the client
A change or additional work above the limit	the client's written decision only
Extension of time	the client's written decision only
Acceptance of works, signing a certificate	according to the contract; confirmation by the client is advisable
Termination of the contract, claiming a contractual penalty	the client only

The financial limit is a sum or a percentage of the contract price, chosen by the client. No statute prescribes such a limit, and this article does not recommend a specific level. What matters is that the limit applies both to a single change and to the total of changes, because small approvals add up.

Every approval must be in writing and easy to find. Building Code § 15(3) lists, among the construction documents, the construction diary and the minutes of site meetings. If the project manager approves a change at a meeting, it must be in the minutes together with the price or the way the price will be determined; otherwise all that remains is two people's memories. The evidential value of documents is covered in the article on construction records as evidence.

The project manager's most valuable output for the client is the forecast final cost. The sum paid shows the past; the forecast final cost shows whether the agreed sum will hold. The contract can require the project manager to present, for each reporting period, the agreed price, approved changes, claims under discussion and the forecast, and to tell the client without delay if the forecast exceeds a limit set by the client.

How to prepare such a forecast is not the subject of this article. The cost tracking method, and who prepares the structure of the tender and the budget, are covered in the budgeting guide article on who prepares the structure. What matters here is the obligation alone: who prepares the forecast, how often, and within what time they report bad news.

The duty to report also matters as regards the contractor. If the construction contract contains a non-binding eelarve (estimate) within the meaning of VÕS § 639 (the estimated cost of the work agreed in the contract, not the client's internal budget), the contractor must notify the client without delay of a substantial overrun. The project manager must know that such a notice has to be passed on to the client immediately, because that is when the client gets the choice to agree or to terminate the contract.

The split between the two roles must be in writing. Under § 2(2) of regulation no 80, where there are several supervisors the owner must define each one's field and scope in writing and inform the builder. The project manager is not a supervisor, but the same discipline suits them too: write down who checks the quantity of work done, who assesses quotations for changes and who signs the certificate for covered works.

The requirement of independence applies by law only to owner's supervision. Under Building Code § 20(2), the supervisor may not be connected with other activities relating to the same building or with the persons whose activities they supervise. There is no such provision for the project manager: if the client wants the project manager not to be connected with the contractor, it must be in the contract, together with an obligation to report conflicts of interest.

If the same person performs both roles, check whether the project manager's tasks are compatible with the wording of § 20(2), and write the tasks of each role separately. The law does not deal with this combination directly, so this article neither confirms nor rules it out.

The client often chooses a person, not a company. For a contract of mandate, VÕS § 622 presumes personal performance, though help from a third party is possible. If it matters to the client that a particular person manages the project, the contract states their name, the conditions for replacing them and the client's consent to the choice of replacement. A change of project manager in the middle of construction is one of the most expensive moments, because knowledge of oral agreements leaves with the person.

The documents belong to the client and must be in the client's hands. The contract can require that all site meeting minutes, approvals of changes, contractor notices and final cost reports be kept somewhere the client can access, and be handed over when the contract ends. If the project manager's inbox is the only place where the approval of a change exists, the client cannot use it in a dispute without their help.

The end of the contract must be thought through. Write down the notice period with which either party can end the contract, what the project manager hands over at the end, and whether they will still answer questions about changes they approved after the contract has ended.

For a contracting authority, the project manager's opinion does not replace the authority's decision. The Public Procurement Act requires a written, reasoned decision by the contracting authority for certain decisions, for example when rejecting all tenders under § 116. The project manager can prepare the decision and draft the reasons, but the decision is made by the contracting authority; see the article on when all tenders exceed the estimated value.

The limits on modifying a public contract apply even when the change is prepared by the project manager. Their authority to approve changes cannot be wider than what the Public Procurement Act allows the contracting authority.

When reviewing the contract, five points are worth checking. They cover most of the risks described above:

1. a list of tasks that goes beyond the words “project management”;
2. powers and a financial limit for both a single change and the total, repeated in the construction contract;
3. reporting on the forecast final cost, with its frequency and a notification deadline;
4. the split of tasks with owner's supervision;
5. independence and the reporting of conflicts of interest, if the client wants them.

There is no neutral public source for the price of this service, so the article does not give price levels. The specific features of renovation are covered in the guide to choosing the designer and supervision for a renovation.