Owners, Contractors and Design Professionals – the three major players in a construction project. Are they partners in the project? Are they members of the same team?
The answers are: No, Maybe and Depends. From both a legal and financial perspective, these parties are not partners and you, whether an owner, contractor or design professional, should not think that is the relationship you have.
Construction Team Objectives
Are the parties part of the same team? If the objective of the team is to complete the construction project in accordance with the owner’s vision, (with valuable input from the design professionals), for the price agreed upon and on the date expected by the owner, (with valuable input from the contractor), then maybe all are playing on the same team. However, the team’s objective is only realized if the plans, specifications and other contract documents accurately reflect the owner’s vision; the price specified in the construction agreement is the total amount the contractor will demand to build the owner’s vision; and the time frame expected by the owner is realistic and met.
Construction Team Agreements
- These goals will not be achieved unless prior to the commencement of construction, the owner, contractor and design professionals enter into agreements which:
- Clearly and fully describe all labor, materials and services the contractor is required to deliver for the price listed in the agreement?
- Clearly and accurately assign responsibilities between the owner, contractor and design professionals–and the parties understand all of their responsibilities versus those of the other parties. Provides an initial communication and follow up dispute resolution process between the parties whenever an event or dispute arises which threatens the successful completion of the project on time, on budget, and as envisioned by the owner.
In the next three articles I will explore each of the elements of a successful project on the basis of the legal rights, responsibilities and risks of which each party must be aware before embarking upon a construction project.
Business Law EntitiesThe Construction Project: Do We Have a Team? Part 2
It’s No Fun Paying Twice
The Construction Project: Who’s Responsible When Something Goes Wrong? Part 3