I know, you think you hear it enough from me here at Construction Law Musings. I am seemingly constantly beating the drum of early advice from a construction attorney and the benefits of spending a bit of money now to avoid spending a lot of money later. I do this because real world examples of both the costs of failing to prepare early and the benefits of following this advice abound.
An example of the costs of failing to prepare early can be found at the Construction Payment Blog where the zLien folks discuss a New Hampshire case where a contractor lost two thirds of its potential damages because it did not properly set out the contractual terms and what was to be included in contractual damages. Without any clear line to go on, the Court found liability against the NHDOT for negligent misrepresentation and could only award damages up to a cap that was approximately a third of the damages awarded by the jury and about half of what the trial court had determined to be the damages.
If you think you’ve heard enough of this, feel free to move on to another post here at Musings, but in the meantime, think about whether you as a construction professional have taken this drumbeat to heart.
- Do you have an experienced construction attorney among your advisors?
- If you are a subcontractor, do you always ask for the Prime Contract when reviewing your construction contract?
- Do you check to be sure that you have all of the proper construction contract essentials?
- Do you include clauses in your “downstream” contracts that protect you from issues?
- Do you vet your business partners to see if they cause any gut uneasiness?
- Do you actually call a construction attorney early in the process to try and avoid the costs of disputes later and assure that your business relationship starts on the right foot?
If you are doing all of these things, I applaud your foresight and am likely preaching to the choir. If you aren’t consider this a reminder that the pain of a bill from a construction attorney for contract review and early risk management will be much less painful than the litigation that could occur without such a consultation.
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