5 Good Reasons to Have a Construction Contract

It is important for both the customer/ consumer and the contractor to reduce their agreement to writing before construction begins. As follows are 5 good reasons:

  1. The scope of the work can be clearly defined. Putting a description of the scope of the project in writing helps clarify the work being done, and what the charges are.
  2. If the contract includes goods over $500, it must be in writing to be enforced. A contractor cannot enforce a construction contract that includes over $500 of goods or materials without the agreement being reduced to writing.
  3. The scheduling can be precise. With a good written agreement, the scheduling of the work, including when certain phases or parts of the project are to be completed, can be clearly described. The scheduling can also include a payment schedule, which gives the parties certainty.
  4. An attorneys’ fees clause can be included in the contract. Once a contact is created, the inclusion of a clause granting attorneys’ fees to the prevailing party creates leverage and relief in case of a breach.
  5. Insurance, including general liability and worker’s compensation, may be described. In the event of any dispute under the contract, it is important for the parties to ensure that insurance is in place to protect both the consumer and the contractor.

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