If you want to avoid issues with the other party in a construction transaction, there are some hurdles you will need to cross and certain elements you and your legal party will want to look for in your contracts. Whether you are a construction contractor, a vendor or a property owner looking to build or renovate, this applies to you.
How you draft a construction contract has short- and long-term implications on the wellbeing of your project and future projects down the road. Consider looking for the following elements in every construction contract before finalizing your agreement:
- Does it address a timeline? Everyone should know what the expectations are for project completion and other vital timeframe landmarks.
- What about the various costs? Pricing for the services and materials should be included. Also, address any necessary additional fees and extra work charges.
- How will the necessary parties make their payment? The payment method is an important element. Especially when dealing with big money, your plan for the purchases (A monthly plan? All at once?) should be set in stone prior to parties signing.
- Will there be penalties? Penalties for late payment or late delivery of services will help everyone involved better understand the expectations.
- What about material for the job in question? Be sure the contract addresses the types of materials used, as well as their cost, and that they are not prohibited by Florida state law.
- Is there a plan for potential dispute resolutions? If you plan to use mediation or another form of dispute resolution in the event of a contract breach, that should be addressed in the contract.
A good construction contract does more than legally protect businesses, owners and workers, it protects all those involved and provides your project with a solid foundation.