Construction

Whether you enter into an agreement with a contractor to build a new home or to make improvements on your existing home, you are entering into a complex and substantial relationship with your developer/contractor.

Therefore, before signing a contract with a developer/contractor, you should consider reviewing the proposed contract with an attorney.  In fact, some of these very contracts require homeowners/potential homeowners to agree that they have had an opportunity to consult with their own attorney before signing the contract. Other contracts actually give potential homeowners/homeowners a window of opportunity to consult with an attorney.

It is our experience that potential homeowners and homeowners are usually confused and/or mistaken with regard to the following issues: 

  1. Whether a deposit made pursuant to the contract is refundable?
  2. Which documents are customarily signed in this process (for example, should they be required to sign a deed over to the contractor, lender, etc.)?
  3. Whose responsibility is it to apply for permits, licenses, etc., and what happens if it not done appropriately?
  4. What is the exact date that the construction must be complete?
  5. What happens if the construction is not complete by a certain date?
  6. What is the effect if they fail to obtain financing?
  7. What is their role in ensuring that they obtain—and maintain—financing throughout the construction process?
  8. What is the developer’s/contractor’s scope of work (what exactly must the developer/contractor provide under the contract)?
  9. What is the role of the contractor as opposed to the architect/designer?
  10. How can their actions cause permissible delays to the construction?
  11. What are change orders—and how do they affect the contract?
  12. Do they have a right to negotiate the terms of proposed contract?
  13. What are progress payments and how should they be delivered to the contractor?
  14. Why is it the homeowner’s responsibility to make sure that the contractor’s subcontractors have all been paid?
  15. What are “Notices of Commencement” and what effect will they have on their homes?

Obviously, the more potential homeowners/homeowners understand the above issues, the more opportunity they will have to minimize construction disputes, delays, and/or disappointments.