Signing a Construction Contract

The area of Construction is a challenging and robust field of work. In addition, there are many different issues to be looked at before entering into a construction contract. While general law and contract law can apply to dealing with a Construction Site and Construction Contracts, there is also some specialized area to deal with.

When you deal with Construction you often deal with a bidding process. The owner of the land or property solicits bids from different contractors and contracting companies. Based on the bids that they receive , they will then ask several for more formal written proposals in the form of a written specific bid.

The Bid that each Contractor makes is part of a binding offer, if their bid is selected then it can become the first part of a legally enforceable written Contract. There are some other details, but it is precisely for this reason that a contractor needs to know his stuff, and should only bid on projects and things that he can complete in the time and according to the limits of his Bid.

Private Construction operates a little differently, as the property owner has more flexibility on what kind of bids, what type they accept or reject, and the whole bidding process.

Government Contracts

In a Government type of Contract, the rules for the bidding process is strict and has to follow a set of rules and regulations, These rules and regulations are part of the local, state, and federal laws that govern the bidding and competitive public bid process.

Courts are often reluctant to have to get involved, often bids that have a disputed area or that are contested by one or more parties are required to submit first to arbitration before they can go before a court, sometimes this is even spelled out in the contract or public contract bidding rules themselves.

The different parties to a contract in the Construction field normally select from among several different types of contract pricing methods. There are many different kinds, but some of the most common are: Unit Price, Cost plus fees, Lump Sum, or a combination of one or more of these methods.

These are by no means all of the different types of pricing methods, but they are certainly among the most common ones found in the field of Construction today. When you sign a contract there are some things to keep in mind that will make your experience much more positive for everyone involve. Issues to consider include:

Payment Method: What will the terms be for payment, will it allow installments, lump sum, or some other arrangement?

  • Prices: The prices for your contract should be clear, and with no wiggle room or implied prices, everything should be set out clearly.
  • Material Terms: All of the expectations about the services, goods and other particulars should be put in writing in the contract. Don't leave anything to chance or assumption.
  • Time Frame: Make sure the timing of the project is also spelled out in detail, in a contract there is no such thing as "too much detail."
  • Resolution of Disputes: This is where you should put in writing how to solve problems. It is a great idea to spell out the process, and using specific language put how to resolve problems right in the contract itself.
  • Attorney Fees, Breach of Contract, Other fees or Disputed Issues: You should spell out the penalties to either party if something goes wrong, and who will be responsible for paying if something does go wrong.
Before signing a contract for any substantial amount of work, or if you are haveing a contract dispute, it is always recommended that you consult with an attorney before making any binding decisions.

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