A contract is crucial before a construction crew can get to work. In eagerness to start a job, a company may make costly mistakes with a contract.
A recent report shows over $48 billion in dispute in construction projects. Preventing contract mistakes helps a company avoid adding their compensation to that figure.
Signing a generic contract
A smaller company may not feel like there is any harm in using a standard contract found online, but doing so can result in missing vital protections. A generic contract can be a helpful guideline, but distinct agreements should fit every unique project.
Missing or misprinting critical information
In an effort to keep the contract simple, a business might leave out essential details. One missing element can become expensive down the line. Any questions about the job and the company’s responsibilities must be in the paperwork to avoid liabilities. Sifting through legalese might be a headache, but anything that leaves room for interpretation opens the door to disputes.
Additionally, a misprinted name of an entity can void agreements and leave payments and approvals in limbo. A company needs to ensure all items are correct to not deal with troubles later because of a minor technicality.
Not reading the entire contract
Most people rush through a contract and end up taking negotiators at their word. All parties must remember that what is in the document holds up legally in court 99 times out of 100. Contractors and subcontractors should be totally clear on what an agreement obligates them to do and understand all contingencies.
Contracts help honest people understand what to do and how to do it. Construction companies can avoid troubles through due diligence in creating and reviewing contracts.