Reviewing Contracts in the Construction Sector
As we conclude the year, it’s crucial for those in the construction industry to conduct a thorough review of their contracts, especially for long-term projects. It’s advisable to revisit your contracts to confirm they accurately represent the current state of the project. Any discrepancies should be addressed and documented immediately, rather than waiting for issues to arise.
Key areas for review include the scope of work, ensuring it aligns with the actual construction being undertaken. This includes verifying details, from fixtures to significant additions like a new wing in a building. Changes discussed in meetings should be formally documented in line with the contract’s terms to avoid future disputes.
Pricing adjustments are also essential. For contractors working on a fixed price basis, it’s vital to include any additional scope in the pricing. Owners should adjust payments accordingly if project elements have been removed. For contracts based on actual costs, the end of the year is a good time to align charges with incurred expenses.
Another critical factor is the project schedule. Both owners and contractors should assess whether the project is on track and address any delays appropriately, including documenting reasons and determining responsibility for any schedule slippage.
Administrative aspects, such as updating the contact person for your company in the contract, should not be overlooked. Contractors should also ensure timely submission of any claims as per contractual deadlines to avoid disputes during litigation.
In summary, instead of considering the contract only at the start, end, or during disputes, it is beneficial for both owners and contractors to proactively review and update their contracts throughout the project’s lifecycle to ensure they reflect the ongoing work accurately.
_________
At Construction Bonding Specialists, we work with new and experienced contractors to find the most satisfactory bond solutions. As a dedicated surety-bond-only agency with decades of bonding experience, we strive to discover surety solutions for all types of cases, ranging from routine to challenging. Contact us online or call us at 248-349-6227 to learn more.
Written by the digital marketing team at Creative Programs & Systems: www.cpsmi.com