In general, contracts establish duties and obligations that the parties have agreed to, but they also provide protection to the parties if they do not comply with their obligations. Construction contracts include details about the project and the work to be done and how compensation related to the project will be managed. Having a construction contract protects the legal and financial participation of everyone involved in a construction project. Neither the owner of the construction company nor the owner of the property should agree to start working without one.
The parties to a construction contract can be, for example, an owner and a general contractor, a general contractor and a subcontractor, a subcontractor and a subcontractor, etc. A general contractor may handle some or all of the tasks associated with a construction project, or may incorporate other companies and individuals. This list is not exhaustive, and in the next section that analyzes the key elements of construction contracts there are other terms commonly found in construction contracts where the allocation of risks is also appropriate. A construction contract sets out the details and expectations of a project to ensure that everyone is in agreement before work begins.
The above-mentioned clauses are just a few of the many important clauses that can be included in a construction contract. Standard industry forms are commonly used in drafting and preparing construction contracts, especially for large projects. Understanding what can be included in a construction contract and its purpose can help you move forward like either party to this type of agreement, as well as to know what to include in a contract if you plan to hire a construction lawyer. Many construction contracts follow a certain format to ensure that appropriate information and details are included.
Having a legal construction agreement provides a layer of protection for both the contractor and the customer. When you're about to embark on a construction project, you'll want to make sure that you and your client are on the same page. Once all parties have drafted and reviewed a construction contract, the next step in the process is usually the negotiation process. Construction and renovation projects are a great investment for all parties involved, whether you are an owner, a contractor, or a subcontractor.
A construction contract is a document that sets out the scope and terms of the work of a construction project. If you are a contractor, subcontractor, or landlord, consult with an attorney before entering into any construction contract. Learn what should be part of a construction contract and why it's important to have one before starting any construction work. A construction contract is a legal document that describes, in detail, the parameters of a construction project.
