8 Things to Keep in Mind Before Signing a Construction Contract

In the construction industry, you’ll find yourself in this situation time and time again: signing a contract to work on a project as a contractor or subcontractor. Ideally, these documents are meant to define what the responsibilities are for all parties involved in the project are, obligations to each other, delivery of products or services and payment terms.

Once everyone has come to an agreement, the document is signed and cannot be changed unless all parties involved agree. It’s important to understand the terms before signing the contract so you know what you’re committing yourself to. Use the following guidelines below, remember that a contract is supposed to be workable for you and if are not comfortable with it, attempt to negotiate before signing.

If you need someone to help guide you through the process of drafting or making sense of a construction contract, then contact our lawyers in McAllen today!

Timing is Everything

A contract should always include a timeframe. For example, if you are delivering goods, make sure to consider the time it will take to deliver them. If you are on the other end of the spectrum, make sure the delivery schedule meets your needs. If you are looking for a month-to-month type service, double check the contract to make sure the agreement isn’t obligating you for a longer period. We specialize and represent a variety of clients in the construction industry, so call us today if you have any questions.

Prices Matter

When discussing prices, make sure that everything that was discussed is included and look out for other charges that were not agreed upon. For example, when contracting another party, you will often be quoted at an hourly rate. Make sure to include additional charges for services, such as running errands to buy materials. Make sure to know what you’ll charge for additional fees and give estimates.

Payment Methods

Negotiate the terms of payment depending on when you need them and ensure that they pertain to your financial situation. If the contract calls for a payment at the end of the month and your workers are telling you that they are pressed for a different date, renegotiate the terms. You can also ask for installment payments.

Payment Penalties

Speaking of payment dates, determine whether there should be a late payment penalty and if they are reasonable. If you’re working on a project alone, you could be more lenient.

Include Materials and Goods and Services

Coming to terms on the goods and services to be delivered can be tricky. However, as with everything pertaining to a contract, make sure the agreement on the terms is included. For example, if you agreed on collecting roof shingles from a different state, make sure the contract specifically mentions it.

An Inability to Agree

If work needs to be started as soon as possible, but for some reason you still can’t come to an agreement with the other party, make sure not to sign a contract that is enforceable as a permanent arrangement. Include language in the contract such as, “This interim agreement is in effect only until a more suitable or permanent agreement can be negotiated.”

Anticipating Disputes

No matter how good of a relationship you have with the other party, a dispute could arise and you need to be protected. Many contracts usually include an arbitration clause, which means that a dispute could be settled in arbitration instead of court. It’s less costly, but if you do sign a contract with the clause intact, you could waive your right to take the matter to court.

Anticipating Problems

Always do your homework and research the party you’ll be working with before entering into an agreement. They could include prior experiences and particular methods to resolving disputes. Some could be agreeable, but others could be unfair to you and beneficial to them.

Here to Help

We specialize in a variety of cases, including construction litigation. A contract that you understand from the beginning can help avoid headaches down the road. If you have questions about breach of contracts, payment claims, construction agreements, etc., then contact our McAllen lawyers today!

Leave a Reply

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>