Construction Law

How to Avoid Problems in the Construction Process – Part 1 

If you’re involved in construction, you know that the construction process is document-driven. That means all companies in the construction industry must remain on high-alert when preparing, editing, negotiating, modifying and managing those documents. You may think that “construction” means owner, general contractor and sub-contractor. However, the construction industry really consists of all providers within the design-build process. These providers include:

  • Project & Property Owners
  • Architects
  • Surveyors
  • Engineers
  • Site Development Specialists
  • Realtors – Brokers & Agents
  • Title Companies
  • Financiers
  • Lawyers
  • Insurance Providers
  • Property Managers
  • General Contractors
  • Sub-contractors
  • Vendors
  • Suppliers
  • Logistics - Transportation

Plus even more! 

And every step of the process requires the proper documents – to ensure that all parties do what they’re supposed to do, when they’re supposed to do it. Many other reasons exist for the document trail, for example, to:

  • Detail the tasks required;
  • List prices agreed upon, modified and/or paid;
  • Verify what was done and when it was done;
  • Document who did what and when;
  • Outline what tasks remain; and
  • Close the project in an efficient manner.

For those involved in the construction industry, you know that the document process is cumbersome and often difficult to track. Even so, proper document flow is the foundation for a successful project. That’s not to mean it’s the only factor to consider – but that if the process is flawed by incorrect or inaccurate documents, it can influence the success of the project. Consider that the construction project contains these general documents, often in multiples, between the parties involved, listed above:

  • Agreements for Services (Contracts)
  • Prime Contract
  • EPC (Engineering, Procurement, Construction)
  • Contract
  • Design/Build Contracts
  • Sub-contracts
  • Procurement Contracts
  • Supplier Services Agreements
  • Non-disclosure Agreements
  • Financing Documents & Contracts
  • Insurance Agreements
  • Purchase Orders
  • Real Estate & Title Documents
  • Engineering & Architectural Plans
  • Engineering & Architectural Agreements

Within each of those documents, the various factors that affect the project are outlined, including timelines, costs and other rights and responsibilities, such as:

  • Scope of Work
  • Warranties
  • Limitation of Liability
  • Site Conditions
  • Contract Modifications & Modification Procedures
  • Insurance Terms & Conditions
  • Indemnification
  • Payment Terms
  • Lien Information (Releases, Waivers)
  • Schedule & Time
  • Damages & Delay Clauses
  • Notices & Claim Provisions
  • Inspection & Acceptance
  • Termination
  • Retainage

All of these providers, agreements and provisions spell out the rights and responsibilities of those affected. So you must make sure that the document flow is smooth, to avoid many of the problems that plague projects. Why? Because these problems will always result in escalating costs, delays and mistakes.

The key to success is to be organized and efficient as well as knowledgeable about the content.   Since the purpose of this site is to help your business, I will be posting more information, articles and checklists regarding these topics.

Questions?

Call Dan Dorsch, at 913-685-9190.

The Dorsch Law Firm is dedicated to helping your construction business prosper.