Use Your Instincts when Negotiating a Construction Contract
I have often discussed the more “mechanical” aspects of contract negotiation and drafting here at Construction Law Musings. However, there is another, less objective (possibly) and more “feel” oriented aspect to construction contracting that can have as big an impact on your construction project. What am I talking about? Your instinct as a construction professional when looking the other party in the eye and getting a feel for the company or individual with whom you are contracting.
Why is this so important? Firstly, and this is a truism, no matter how well drafted your construction contract is (and it should be well drafted and reviewed by an experienced construction attorney), if the other party wishes to “play games” and not honor the terms of that contract, you could still very well end up in litigation with the attendant frustration and expense. Having a great looking, well thought out and at least reasonably “fair” construction contract may make the litigation process somewhat less painful but it does not completely avoid the risk of litigation. If the other party or parties to the contract decide not to pay you or perform as they promised, you are left to enforce whatever contract you have in place.
Secondly, if you get a tingly feeling on the back of your neck when negotiating job terms, that feeling could be telling you that the job could be one that will be a painful one. Aside from the contract, the course of dealing and the management of the project are probably the biggest hurdles on any construction job. If it seems that you will have a tough time getting paid or that the project management team is one that would be less than ideal to work with, then seriously consider whether you want to move forward with that job. Getting into a project where you feel the management, scheduling, etc. of the project won’t go smoothly is a recipe for an unprofitable and frustrating experience.
Should you always avoid those jobs that you get a sinking feeling about? Not necessarily. Just think harder and bounce the possibility of taking the job or hiring the subcontractor you get that feeling about off of others before you do.
There will always be the occasional project where you wish you had known more before you got into it, but if you listen to your “spidey sense” more often than not, it will lead you in the right direction.
As a quick aside, the photo for this post was taken by my son, be sure to check out his other photos linked from the image.
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