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What to include in a construction contract

On Behalf of | Jul 7, 2024 | Firm News

The secret is out: Safety Harbor is one of Florida’s best places to live. It may be due to the great folks who live there or the mineral spring waters de Soto discovered when searching for the Fountain of Youth.

One thing is for sure: building is booming, and for homeowners and contractors, having a good construction contract is crucial.

Avoiding disputes

A well-drafted construction contract provides clarity for all parties involved. It can help prevent misunderstandings, disputes and potential legal issues. Here are the essential elements that should be in every contract:

  • The identity of all parties involved, including the property owner, general contractor and any subcontractors. Full legal names, business names and contact information should be listed.
  • A comprehensive description of the work to be performed, such as specific tasks and materials.
  • A timeline with projected start and completion dates, along with any milestones. There should also be a process for handling delays.
  • The total contract price, payment schedule, due dates, amounts and form of payment.
  • Provisions for change orders that detail how they will be priced, approved and documented.
  • Who is responsible for obtaining the necessary licenses and permits for the project.
  • The types and amounts of insurance coverage required for the project, such as general liability and workers’ compensation.
  • Manufacturer warranties for materials and equipment.
  • The hiring and overseeing of subcontractors.
  • How disputes will be handled.
  • The circumstances under which either party can terminate the contract, including breach of contract, failure to perform or mutual agreement.
  • Force majeure events, such as tropical storms or hurricanes, that may impact the project’s progress.
  • Provisions for maintaining safety standards and adhering to federal and state laws, local regulations and building codes.

A comprehensive construction contract protects everyone. Before signing any contract, it’s imperative that it be reviewed to ensure it’s legally sound and covers all aspects of the project.