CONSTRUCTION

BIDS FOR CONSTRUCTION PROJECTS

Bids are different offers that contractors provide outlining how much it will cost to complete a project. Typically, an owner receives offers from contractors through a Request for Proposal (RFP) or a Request for Qualifications (RFQ).

A contractor typically publishes the RFP or RFQ during the design phase of a project, and includes specifications of what the owner wants. After the owner chooses a contractor, that contractor will advise on pre-construction matters during the design phase.

NEGOTIATION OF THE CONSTRUCTION CONTRACT

The negotiation of the construction contract occurs prior to the beginning of construction. At a specific time, such as the end of the design phase, the contractor will offer a contract price for the construction of the project. After the negotiations, the owner and contractor will be able to agree on a price and the contractor will continue construction. If an owner and contractor do not agree on a price, the owner may negotiate with other contractors.

CONSTRUCTION CONTRACTS

No matter which type of contract is used, the following clauses will typically appear in a construction contract:

• Changed conditions clause
• Termination for convenience clause
• Site investigation clause

A changed conditions clause is used to shift the risk of loss or delay from the contractor to the owner. A termination for convenience clause applies if a project becomes extremely difficult, dangerous, or expensive. A site investigation clause requires a contractor to investigate the site to prevent disputes about unexpected conditions.

DUTIES BETWEEN THE CONTRACTOR AND OWNER

The law implies duties between a contractor and an owner when they enter into a construction agreement even if the contract does not explicitly state the duties. Essentially, the parties are required to act in good faith in the performance of their contractual obligations.

A contractor owes an owner a duty to perform their services in an appropriate workmanlike manner, including a duty to warn the owner if a design or construction specification may have damaging results. An owner has a duty to cooperate with a contractor and not to interfere with or purposefully delay a contractor's performance.

CAN I SUE A CONTRACTOR?

Lawsuits filed against contractors commonly occur when a contractor fails to follow the contract that was agreed upon by the owner and contractor. Other grounds for lawsuits against a contractor may include:

• A contractor completes a job in an unsatisfactory manner;
• A contractor completes the job but the work violates safety standards;
• A contractor took advantage of a homeowner, including accepting payment but failing to complete the agreed upon work; or
• A contractor that overcharges, which may lead to a breach of contract claim.

TYPES OF LEGAL CLAIMS THAT CAN BE FILED AGAINST A CONTRACTOR

The most common grounds include:

• Breach of Contract — Available when one party fails to follow through with their obligations under a contract. A breach may occur when a party has not delivered in the specified time frame or if a party fails to perform at all.
• Contract Fraud — Occurs when one party knowingly makes a false claim with the intent to trick or deceive the other party into signing a contract.
• Defective Construction Work — Includes construction defects which lessen the value of a home, such as design deficiencies, material deficiencies, construction deficiencies from poor workmanship, or subsurface deficiencies.

SHOULD I CONSULT AN ATTORNEY EXPERIENCED IN CONSTRUCTION LAW?

Yes, it is essential to have the help of an experienced real estate lawyer for any construction law issues. Construction contract negotiations are often complex and difficult. An attorney can assist you with contract negotiations so your needs and requirements are met.

Your attorney can assist you with drafting a construction contract, explain your duties under the contract, and ensure your rights are protected. An attorney can also represent you in the event that a dispute arises and during any court proceedings, if necessary. Call our office today or complete the convenient online contact form to set up a consultation.