Does signing your general contractor's
construction contracts make you feel like you're stepping off
of a cliff??
Unfortunately, signing construction contracts is
a necessary "evil" for
almost all construction contractors ... Even more unfortunate is
the fact that many construction contracts issued by general
are extremely risky to subcontractors.
section of our site serves to highlight some of the dangerous
clauses that subcontractors accept in their construction contracts,
often without even realizing what they've put at risk.
THIS ARTICLE IS A GREAT BEGINNING SAFETY NET.
READ AND LEARN FROM THE NIGHTMARES OF OTHERS!
Currently, construction contracts are required when the work is
over $500 (in California). Signing a contract issued by a general
without reading and understanding it first can
You must read the entire construction contract before
you sign it. If
you do not read, and understand, the contract before
you sign it you could be putting your
entire company (as well as your personal possessions, home, etc.)
at risk, without even knowing that you have.
I wish that I could tell you that all contracts are created equal
and that all contracts protect the subcontractor as much as they
protect the general
contractor, but unfortunately that is not the case.
I have seen
so many different contracts out there, some that are very simple
and many that are extremely complex.
I received a contract from one company that was so 'out there'
that I put it in front of my attorney to review for me. She told
me that this particular contract was one of the harshest contracts
she has ever seen (meaning: I would be at great risk if I signed
it as is).
So, I contacted the general contractor and requested that either
a) they modify the contract as specified or b) they contract with
me via my proposal
Of course they were offended and decided that they did
not want to hire me to do the project so they called the next
bidder and asked if that bidder would do the project at my price!
That bidder told the general contractor no way, so they ended
up agreeing to contract with me via my proposal.
As it turned out,
was an absolute
(the superintendent couldn't manage a self-contained ant farm,
let alone a jobsite!) and the only thing that saved me from
put out extra money that I should not have to put out (because
the super was too busy chasing ants to make sure the job was
properly), was the fact that I did not sign their contract, they
signed my proposal.
Be aware that when and if you request changes to the contract,
the general may refuse and then it is up to you to decide if you
want to sign the contract as is or not.
There have been jobs that
I did not take because the general would not make changes that
requested, but there have also been several contracts I've accepted
even when the general would not make the changes (many times
base our decision on how much we stand to lose if the general chooses
to enforce the unfair clause)....
Now please keep in mind, we are not attorneys
nor do we have any legal training whatsoever, everything we include
here is strictly examples based upon our and other contractors
actual experiences. Please
speak with an attorney to make sure the construction contract that
has been issued to you is acceptable and worded properly.
Contracts Continued on Page 2