As anyone in the construction industry knows, a construction project never goes according to plan. Unfortunately, there are just too many things that can go wrong. Between weather delays, change orders, and, inevitably, lawsuits, there will always be something that goes awry.
The Subcontractor
Have you ever signed a contract to only, later on, realize that the scope of work in the contract was different than what you bid? Legally you are responsible for the work you signed the contract for, even if it is different from the work definition in your bid. Unfortunately, this means that any added scope of work that you did not account for is your responsibility on the project, and you will not get any additional funds to provide this work.
Why is scope of work important? Your employees, the subcontractors you hire, and your company will be out whatever it costs to complete the construction project you signed the contract for. This can even mean you will be responsible for the work details for an entire portion of the project that was not in your original scope. This is why it is crucial to make sure you carefully review the scope of work before signing any contract. To learn more about this process and ensure you are fully covered, read our blog Scope of Work – The Fundamentals.
The Owner or General Contractor
How do you create a good scope of work? If you are the owner or general contractor and provide a set of scopes to the subcontractor, you need to make sure you are providing the most accurate list of work you possibly can. If you give an incorrect scope of work to a general contractor or subcontractor, they may not have to provide the work. For example, your project has electrical, plumbing, and carpentry. You have one general contractor that provides a bid for all three of those scopes, so you hire that general contractor.
However, when you go to sign the contract, the scope is different than what you need—it only includes electrical and carpentry. This mismatch in the definition of the scope of work can lead to significant issues on the project. If you signed a contract stating the same amount of money requested in total for all three parts of the job for only two scopes, you would be required to pay that contractor the full amount. After that, you will still need someone to complete plumbing, and you will have to go through the entire bid and contract process again.
Conclusion
A lot of trouble can be saved by checking the scope and contract before you sign as they say, “An ounce of prevention can be worth a pound of cure!” Reviewing and interpreting contracts is a service we provide here at The Cromeens Law Firm. Our attorneys draft, negotiate, and litigate contract disputes every day. We have plenty of experience with these situations and can save you time, heartache, and money by properly negotiating your contract. We will make sure you understand every term you agree to so that you and your business are protected!