As a subcontractor on any significant construction project, your first instinct after you’ve been selected by the general contractor might be to get the contract out of the way so you can get to work. But rushing through the contract process can leave you at a significant disadvantage down the road, particularly when the project hits the inevitable bumps along the way. Taking the right steps at the contract stage will help cushion your company from damage when things don’t go as planned.
Bid Realistically
This might sound obvious, but at Emalfarb Law, we’ve seen project after project where an eager subcontractor underbid a job or left themselves without enough cushion to cover problems that arose during the project. Everybody wants to get work and keep busy, but you also have to stay in business.
As you calculate your bid, try to account for both the factors you can control and the ones you can’t, building in some room for unexpected delays, material price changes, rework, and the like.
Negotiate for Future Claims
A good contract will set you up for making strong claims in cases where the GC or owner is responsible for a delay or project change that negatively impacts your bottom line. That means you need to make sure the contract is clear about exactly what your role is in the project, which documents or plans define the scope of what you’re expected to do, how and when you’re to be paid for your work, and what the procedure is when there are problems with or changes to the project.
Over the years, we’ve seen too many situations where an unclear contract leaves a subcontractor unsure about their rights and how to enforce them. At Emalfarb Law, we’ll make sure you’re working with a strong contract so you can avoid those kinds of problems.
Stay on Top of the Paperwork
Experience has its benefits. If you have one or two key people in your organization who are responsible for reviewing and negotiating all of your contracts, you’ll be more likely to end up with strong contracts that benefit your company instead of dragging it down. It’s just as important, once the contract is signed, to have someone making sure that the contract is being followed and highlighting potential problem areas when it isn’t.
Emalfarb Law can work with you and your accounts receivable officer or contract manager to make sure the proper claims, notices, and filings are made in a timely and effective way. We regularly help our clients avoid big problems by making sure they take care of the little ones. Staying proactive about potential claims goes a long way towards keeping projects profitable and avoiding expensive and time-consuming construction lien litigation.
Contact Emalfarb Law for More Information
For more on contract and claim strategies, check out our other recent posts. To discuss your contract, use our online reservation form to set up a consultation.