10 Essential Contract Documents for Every Construction Project

Scoping, Schedules, and Construction Costs Are Key

Constructing a solid contract represents one of the first steps toward the success of your project no matter what you're building. This list explains the documents that are typically a part of every construction contract. There are also numerous other exhibits or forms that you can use in combination with these documents.

1. Contract Agreements and Contracts

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This agreement is used by the contracting officer or owner and the contractor. It's an essential component of the contract documents. It's the main document to which most other documents attach or reference.

2. Statement of Works (SOW)

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Having a solid scope of the work involved is helpful during the bidding process and later on during the construction sequence. A well-defined scope can be used to determine the amount of work needed to complete the project.

3. General Conditions

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This contract document defines obligations regarding the execution of the project as well as each party's rights. Overhead costs, what to claim, and your entitlements must be included in this portion of the contract.

4. Special Conditions

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This is usually an extension of the contract and an addendum to the general conditions. It should specify certain conditions and clauses that pertain to each particular project or job. Pay special attention to specific instructions and requirements on how to perform the work.

5. Bill of Quantities

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This document is formed by the list of diverse trades and materials that will form part of the construction. Sometimes this document is not required by the contracting officer.

6. Drawings

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All contracts should include a set of drawings that form part of the job to be performed. These drawings are usually the latest and most recent available and must be received by the contractor prior to the date of commencement. They must include all drawings from consultants, and they'll constitute the entire project that's being contracted.

7. CSI MasterFormat Outline

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This is the technical requirement to complete, execute, and/or perform every little task or supply every material being incorporated into the construction project. It will add intelligence to the construction drawings, specify common standards, explain deviations that have been accepted, detail materials that have been accepted, and cite the required testing for all materials. Specifications are usually made by referencing construction standards and codes.

8. Creating Construction Schedule

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The construction schedule is an important component of the document. The contracting office will know how and when the project will be completed by reviewing this part. Construction contracts sometimes require updated schedules throughout the construction progress, and they might form part of the monthly or agreed term for application for payments.

9. Cost in the Construction Industry

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This is a breakdown of all items being incorporated into the construction project. It's usually the base of the application for payment. It can be detailed per item or in a lump sum form that doesn't specify individual items.



10. List of Common Types of Construction Insurance

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This is an essential part of the contract because it provides a guarantee to the owner that the contractor has the means and the economic backup to perform under the terms of the construction contract. It will include specific types of coverages, required bonding, and all insurance protections available to the owner, the contractor and third parties.

Do you need more?

You can also include details on when to issue stop-work orders, information about liens, staffing requirements, safety instructions, and excusable events and how they can be identified. Every contractor or builder should explore the possibility of additional documents depending on their industry and trade specification. The goal of these documents is to establish a way to solve claims and issues and to provide the legal body that will be used to present claims and solve the potential conflict in the case of any legal action.

Source: The balance small business, written by Juan Rodriguez (16/05/18)

www.thebalancesmb.com