5 Steps to Writing an Effective Construction Contract

Construction contract is a legal agreement which is similar to other documents. It legally binds and defines the rights of both parties with respect to a construction job. While there are many default templates available in the market which you can purchase, creating your own document will be highly efficient and will deliver the right message when compared to pre-defined text. When you spend time to write the contract yourself, you are investing time to notify specific terms, insurance clause, obligations and deliverance pertaining to the project that you are going to undertake. Before writing one, go through the simple but efficient five steps given below to know what you should be doing.

Renovated House

Begin With Simple Layouts

A construction contract is a legal agreement and can be handled with professional ease when a lawyer does it. But, if you are going to do it for the first time and have never written such documents, start off with a simple layout. Stay away from complex clauses until you get the hang of the job. For starters, download a couple of templates from the web and read through them. You will most probably find some common elements shared between these documents. Use them to your advantage and tailor them to your specific needs. Make sure you give extra attention to the payments column.

Check the Important Ones

While it is easy and advisable to use general text found in samples, you should be very cautious when it comes to the important areas of your document. They are 1) the scheduled dates before which the project has to be done and 2) the payment details. If you are going to promise a client that the construction or design will be done by this date, you should get it done. Failing to do so could even lead to lawsuits if you don’t have an amicable relationship with the client. Specify the dates properly and check the text associated in the lines. The payment part also matters which specifies whether there are job milestones or a full payment is to be made at the end of the project.

Define the Job Scope

Clearly outline the jobs and responsibilities that you agree to do. This will help you avoid any additional jobs that may be imposed on you at a later stage. From a client’s perspective a good contract that defines the scope will allow them to make sure the work that was promised has been delivered with due diligence. Both parties should understand the obligations and the job scope area will play a key role in this aspect.

Add Insurance Provision

A detailed insurance provision is mandatory in any construction contract. When you associate yourself with a professional company like Urban Trendfor your remodeling, design or construction needs, they will provide comprehensive service. The insurance clause specifies worker compensation, coverage, professional liability, builder’s risk and any mistakes in workmanship which should be rectified. The clause will also be the guideline that will specify the liabilities of client and the customer. It will add information on who provides the insurance and who can avail it in case of any conflicts.

Define Deviations

Even the best planners in the country could sometimes fail to deliver or there could be deviations that come into picture because of varied reasons. Specify in the construction contract on how such deviations from the original plan will be handled. The clause can be used to reiterate the importance of receiving confirmation from a contractor before the sub-contractor begins any extended work, or to add or delete jobs or to modify the scope of the project.

Another important things all project owners should check are the contractor’s state license and the number of pages of the contract. This will safeguard them against additional changes in the future and from other fraudulent activities carried out by adding an extra page. The document should always include the full name of the parties involved as well as the companies they are associated with or working on behalf of. Drafting a construction contract is best done by a lawyer as it is prone to liabilities and claims if it has errors. You can always follow the tips above and consult an attorney at the end for a review – this is the most cost-efficient way.

You might also like;

Add a Comment