I have been beating the drum of the need to have a solid construction contract as the basis for your construction project and contractor/subcontractor/supplier relationships. I have also emphasized that communication early and often is one of the best ways to assure a smooth project. However, the sad truth is that even with the best contract drafted with the assistance of an experienced construction attorney, if the other party to the contract simply decides not to perform, whether that is through unjustified non-payment or simple refusal to complete a scope of work without reason, it will be an expensive proposition to force compliance or be compensated for the monetary damage caused by such actions.
It is this often unmentioned truth relating to any contract, including those that construction professionals in Virginia deal with on a daily basis, that makes having a good knowledge of those with whom you plan to contract is key to a successful (read profitable) construction project. Of course be sure that any contractor or subcontractor you contract with has the basics of propoer insurance, the right experience and of course a contractor’s license with the proper specialty or specialties. These basics will get you most of the way to assuring that those that contract with you at least are responsible in business. Another key component, if you can find this information out, is the financial wherwithall of the other party. For a General Contractor, this means both sides of the equation: Owner and Subcontractors. For a Subcontractor, the key is the Contractor, but any other information you can get on the Owner is helpful (though this can be difficult) particularly in the face of a “pay if paid” clause.
While the items above are the “objective” measures and may seem obvious, sometimes the less obvious and more instinctual measures can and should be considered at least as carefully. If you’re reading this blog, I hope that you’ve had some experience in construction. Use this experience by looking the project manager for the General Contractor, or the owner of the electrical subcontractor, in the eye and decide if you think that person will be a good partner for you moving forward. The hair on the back of your neck or that feeling in your gut (not to mention word on the street) can and should inform your contracting decisions.
If you take the time to do the above, you can at least go into a job with your eyes open. Can you contract with a company that you get “that feeling” about? Sure, but you need to be even more of a stickler with the terms of the contract and with assuring that you follow them to the letter and hopefully have enough padding built into your price to allow for a hiccup or two. Of course you should have this with the best jobs but you may want more for a job that projects as difficult.
To wrap up, a good construction attorney can get you set up from a document and advising standpoint with the baseline contracts and interpretations of those documents, but use of your instincts and some basic investigation along with this advice will be key to a successful construction project.
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