As any contractor knows, issues that arise on a job can trigger a dispute, which could lead to a production delay and ultimately to litigation.
Creating a clearly written agreement to begin with goes a long way toward preventing a costly outcome.
Construction contracts often contain a great deal of information from building plans and specifications to the scope of work involved in the project. Unfortunately, readers, notably various subcontractors, can misunderstand various sections of a construction contract, which can lead to disputes. Therefore, each clause in the contract should have a clear meaning so as to avoid misinterpretation.
Disputes in the construction industry often arise over undocumented change orders. When a client requests changes from what appears in the original agreement, contractors sometimes make the mistake of agreeing to the change without drawing up proper documentation. Disputes between owner and contractor can erupt over the amount of time the change is estimated to take as well as the additional payment the work requires.
Subcontractors are often caught in the middle of an argument. They do not communicate directly with an owner but take their orders from a general contractor. They are at a further disadvantage if the construction contract leaves questions as to the scope of work or other issues that might draw them into a dispute.
The well-written agreement
Disagreements concerning change orders, construction defects, subcontractor substitutions and other problems can easily develop during the course of a construction project. However, documentation that is clear, concise and easy to understand can lessen the opportunity for harmful disputes.