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What to Consider Before Signing a Construction Contract

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Construction contracts are crucial for securing project completion. The details that shape project progression will be decided on with this document. If you’re reading this, you are likely a contractor that is frequently tasked with signing construction contracts. Below, we discuss what contractors should consider before they sign on the dotted line. To ensure every minute detail of your contract is reviewed for accuracy and transparency, contact a Houston construction attorney from Cotney Law. 

Scope of Work 

Before you sign, you must be aware of every aspect of the scope of work, including the expected time frame and prices. Be sure that the contract allows enough time for project completion and unforeseen hurdles that are sure to arise over the course of a project. Double check that the final contract amount is what you agreed to. If the scope of work is an attachment separate from the contract, be sure that the contract mentions this.  

Payment 

The contract should clearly state what you are to be paid and how often. This is crucial for avoiding disputes and ensuring that work continues on a project. Don’t be afraid to negotiate the payment schedule with an owner. Payments do little good if they are received after bills are due. Reviewing your contracts for payment details is especially important in Texas. Texas has prompt payment laws that stipulate when contractors, subcontractors, and suppliers must be paid by. In the event of slow payment, the contract will stipulate who is entitled to prompt payment penalties and remedies.

Dispute Resolution

Construction disputes are an unfortunate reality of the industry. They are made all the more unfortunate by how often they could have been avoided with a well-drafted construction contract. In the event of a dispute, your contract should have a clause pertaining to alternative dispute resolution (ADR) methods, such as mediation and arbitration, that stipulate how conflicts are addressed. 

You must also be on the lookout for language and sections that shift the blame from one party to another, such as indemnity clauses. Failure to account for a clause such as this could result in you being held responsible for another company’s negligence. This would be especially damaging in the event of a construction defect. 

Have a Professional Review Your Contract 

These are just a few of the things you should be considering before you sign. Determining if your contract is worded in your best interest will depend on its details and your specific situation. The only way to guarantee that a construction contract is comprehensive and well-drafted is to have it reviewed by Houston construction attorneys. Having a lawyer review your contract is a minor task that can pay dividends. Mechanic’s liens, stalled projects, and cash flow issues are all problems that can result from a poorly drafted contract. Before you sign, contact the team at Cotney Law to have your contract reviewed by a Houston construction attorney.

If you would like to speak with one of our Houston construction attorneys, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.