More than labor demands, rising material costs, or acts of God, a poorly drafted contract can make or break a construction project. From schedules to dispute resolution, it’s amazing how only a handful of pages can determine the entire course of a project. In this article, a Birmingham contractor attorney with Cotney Construction Law discusses what you need to do to create a solid foundation for your construction contracts. Just like how you’d never build upon a pillar of sand, you should never leave the fate of your projects up to poorly negotiated and drafted construction contracts.
Avoid “Boilerplate Contracts”
Boilerplate clauses are standard across the industry and are essential for ensuring that all parties are on the same page. However, you’ll want to avoid “boilerplate contracts,” entire contracts that you download online. While these contracts can be a great starting point, they are in no way comprehensive enough to detail the complex stipulations discussed throughout this article, let alone protect your business.
Set Yourself Up for Success
Contract negotiations can either set you up for success or failure. This is your time to negotiate everything from the scope of work to payment schedules — nothing is off the table. Too often, contractors can back themselves into a corner later on during a project by agreeing to contract provisions that weren’t in their company’s best interest.
Include a Way Out
No construction contract would be complete without an alternative dispute resolution (ADR) clause. These clauses are vital for ensuring that projects are seen through to completion even if multiple parties threaten litigation. Your contract should specify exactly how disputes are to be settled, whether they be by arbitration, mediation, or another form of ADR. Without an ADR clause, you could be leaving litigation as the only option to resolve disputes on your projects, something that your company may not be able to afford.
Related: Can You Afford a $19 Million Dispute
Consult an Attorney
Only a contract drafted by an attorney can be comprehensive enough to not only outline dispute resolution processes but also prevent disputes in the first place. When we draft construction contracts, our Birmingham contractor attorneys ensure that every care is given to payment schedules, the scope of work, project timelines, and expected outcomes — variables that commonly lead to disputes. Before you sign on the dotted line, consult a Birmingham contractor attorney 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.