Contracts are at the heart of construction operations. Without a contract, your company won’t be able to operate with any type of protection from fraud, broken deals, or disputes. It’s rare that construction companies will work without any type of contract, but it does happen when construction companies agree to do work without a written contract. There are many potential problems that arise from this, including not knowing whether or not they can file a claim without a written contract. In this article, a Nashville license defense attorney discusses the possibility of filing a claim without a written construction contract.
Different States Have Different Laws
Written contracts are required because it helps ease the process of doing business and prevents one party from potentially entering into a contractual agreement with someone else that could easily be voided. In addition to this, written contracts help protect the interests of both parties by ensuring that adequate consideration has been made for their interest before a transaction is closed.
Some states enforce verbal contracts, while others require a contract to be in writing. You need to know about the different rules that each state has regarding what type of written contract must be used before a transaction closes. Some states do not require a written contract for certain types of contracts. Other states require that a written contract be used for a building contract but don’t require the same for any other type of contract. This varies based on the state.
Always Have a Contract
In most states, there are laws that prevent contractors and employees from being able to use non-standard language in their written contracts, but these laws only apply when the contract is actually being created and not just verbally agreed upon. If you have a written contract with a person that works for you, they cannot be accused of not signing it because you didn’t write it down, even though verbal contracts may be enforceable in some states. Therefore, you should always make sure that your contracts are 100 percent legally enforceable, especially if you’re having any type of contractual disputes with other contractors or your own employees.
Make Sure It’s Enforceable
Even if you do have a written contract with a person that works for you, sometimes that contract can become worthless in the event of a lawsuit, regardless of whether it’s enforceable or not. This is why it’s so important that you talk through any concerns you have with your potential contractors before you ever sign anything. That way, if a lawsuit arises, you’ll have something to show a judge or jury of impartiality. In addition, most construction law firms will let you discuss the specifics of any construction law contracts or oral agreements with a construction attorney before you sign them, so it’s really important to use this resource if you’re ever in any doubt about anything.
Sometimes You Can’t Make a Claim Without a Written Contract
There are many instances where you will not be able to make a claim without a written contract, even if you are on the right side of the law. This is because you aren’t able to prove the terms that the other party agreed to or show that you honored the agreement. Sometimes, in projects that don’t have any issues, this doesn’t matter but, if you run into a legal issue, you’ll soon wish that you had a written contract that could be enforced.
Verbal Contracts Aren’t Enough
Although verbal contracts are common in many types of transactions, one does not always have the ability to enforce them. Verbal contracts are harder to enforce, in general, because it is not necessarily in writing, as it is in the case of a written agreement. Therefore, there is always the risk that the verbal contract will be interpreted differently and not as a legally binding contract. The courts are likely to take a dim view of any construction dispute where the parties did not agree with a written contract.
A construction lawyer may be able to help you avoid any type of construction law controversy by helping you negotiate written contracts so that they do not run afoul of the various construction law statutes. However, it’s important that you work with someone who is able to understand the legal implications of verbal contracts. Your construction lawyer should also be aware of any other pertinent legislation that may concern you and how that legislation may be affected by your contracts.
Starting a construction project without a written contract is a gamble and is one that your company does not have to take. There are plenty of available options to help your company create and use contracts, including working with a Nashville construction attorney. If you have questions about the kinds of software and documentation you may need, contact a Nashville construction arbitration lawyer from Cotney Construction Law.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.