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Three Things Every Contractor Should Know Before Signing That Construction Contract for Building Remediation

by G. Trippe Hawthorne and Mark D. Mese

In a perfect world, Contractors would only do business with owners, designers, subcontractors, and material suppliers that they know well and trust. No surprises, misunderstandings, or disasters.

In this world, doing business is risky. The trick is to identify and analyze as many of the risks as you can, so that when you take a risk, you know what the risk is, and have some ideas about how to deal with it, should things go badly.

Here are three risks that you always want to identify and analyze:
 

1. Who is paying for the work and what is the payment mechanism? In other words, if you are doing remediation, are you going to be paid by the property owner, the building tenant, their insurer, their bank? If the person you have contracted with can’t or won’t pay you, do you have a mechanism of getting funded from the funding source?

2. What is the history of the building where you are working? Are those asbestos tiles? Is that mold in the corner? The last thing you need is to get into a project and be shut down because you are not licensed to do critical path work.

3. What is the building user’s business? What happens in the building? If you are contracting with the building owner, does the prime tenant’s business keep you from working 9:00-5:00 Monday to Friday? Are there medical records or other confidential documents for which special accommodations must be made? Is there sensitive equipment that your demolition crew needs to know about?

It is hard enough just doing the work that you think you are agreeing to do. Make sure that you are not taking on other problems too.

Full post as published by Louisiana Law Blog on October 13, 2008 (boomark / email).