Nowadays, the global demand for residential and commercial buildings is on the rise. Even though high construction profits are almost guaranteed, a mishandled contract may leave you with losses and costly lawsuits.
Notably, most contractors and subcontractors regard this contract as a mere document filled with legal jargon. They would rather assume that the other party in the agreement has their best interests at heart, and thus sign the contract without understanding it.
However, to get the most out of your contract, here is what you need to consider:
Time frame
Most contractors will quote the shortest project completion time frame to please a client. Your contract should nonetheless allow adequate time for you to complete the project. The time frame should include the project’s start date and its projected completion date.
Termination clause
This will detail the circumstances under which you may halt your obligations in the contract. The law allows you to terminate your agreement by mutual consent if the contracting party breaches its terms. The termination clause is essential for you to end a contract that is not favorable to you, without attracting legal penalties.
Dispute resolution
Even though you may do everything to uphold the terms of the contract, disputes may still arise. For that reason, your contract should include the methods of dispute resolution.
Most construction contracts have an arbitration clause. This means that the settlement of disputes arising from your contract may take place in arbitration and not in a courtroom. Whichever option you choose, just make sure you handle all the issues amicably.
Payment terms
Most disputes often arise from payment disagreements. The payment terms in your contract should, therefore, be clear. Also, they must include the cost of services that you intend to offer and any additional fees. You should also include your preferred payment method and possible penalties in case of late payment.
