Common Construction Contract Problems

The single most common reason that there are problems with construction contracts is that the parties do not understand exactly what is expected of them. Specifically, one or both of the parties don't know the terms of the contract, their obligations or even their understanding of the other party's obligations.

There is a false sense of security when using standard contracts such as AIA, that both parties will be fairly treated. In fact, all contracts are slanted to favor one of the parties, usually the one that created the contract. Because of this, it is especially important to have a contract that was drafted for a specific project by an experienced construction attorney.

Things get more difficult when someone who is not very familiar with construction contracts, decides to make modifications. In nearly every situation, there are other clauses within the contract that are affected by these modifications. Or, when specific language is substituted with general or vague language in order to be more encompassing, the contract loses its power.

Because there is no requirement to put clauses in any particular order, it is not uncommon to find similar or even the same clauses in different parts of a contract.

It is also common to have clauses that are not allowed, such as pay-if-paid, or pay-when-paid, or waivers of some right. Anyone who is well versed with contracts will be able to spot these immediately, and have them removed.

Conflicting Terms
No Contract
Breach of contract
Termination (for cause or convenience)
Payment disputes
Change orders
Changed conditions
Bid Protests/disputes
Defects & Failures
Liquidated damages

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