Construction projects rarely go exactly according to plan. While everyone may be on the same page when the project begins, eventually there may be disagreements about the cost of materials, changes to the work, problems with payment and deadlines.
When a construction contract doesn’t clearly address potential issues, a relatively small disagreement can turn into a costly dispute. A well-written agreement can help reduce uncertainty and provide a clear framework for resolving problems. Here are some common mistakes to avoid.
1. Failing to define the scope of work clearly
One of the most common sources of construction disputes is a vague description of what the contract is actually expected to do.
A well-drafted contract should identify the work to be performed in enough detail that both sides understand what is included, and what is not. By incorporating plans, specifications, materials, finishes, equipment and other project requirements, you leave less room for conflicting interpretations.
2. Relying on verbal agreements
Construction projects often change after work begins. An owner may ask for a different material, additional work or a design modification. A contractor and owner may discuss the change and agree verbally to move forward.
The problem is proving exactly what was agreed upon later. Document important changes in writing, including any price changes and their effect on the project schedule.
3. Being vague about payment terms
Money is frequently at the root of construction disputes. Contracts should clearly explain the amount due, payment schedule, retainage (if applicable), conditions for payment and procedures for submitting invoices.
The agreement should also explain what happens if a payment is late or disputed. Contractors and subcontractors should also pay close attention to Florida’s construction payment and lien laws rather than relying solely on the contract’s language.
A carefully drafted contract can’t eliminate every potential problem, but it can establish clearer expectations. It’s essential to understand the statutory requirements that can affect the contract and the project. A legal professional can work with you to create a construction contract that is clear, well-written and compliant with Florida law.
