Wise Up Wednesday – An Important Message About Your Business!
Understand The Contract.
It’s back after a summer break! Your exclusively for Specialist Contractors weekly email with important advice and information directly relevant to your business.
As you may well know, I am an ex Specialist Contractor and have been resolving commercial and contractual problems for Specialist Contractors for over 30 years. And I have seen all manner of dirty tricks and mistreatment dished out by some of the people for whom you work.
Of course there are some great companies out there and when things go well construction is a fantastic industry. But, I am sick and tired of seeing good people like you suffer at the hands of the liars and cheats that work for certain Contractors and Employers.
Construction can be a tough place to do business and as a Specialist Contractor, Trade Contractor or Subcontractor your business is most at risk.
And whilst losing everything you have grafted for and worked so hard to build up isn’t something you like to think about, understanding how it happens to others can help you to prevent it from happening to you!
It’s a blunt message, but I need to get the message to as many of you as possible, because otherwise the liars and cheats are going to destroy the very core of the industry which is made up of the great hard working businesses like yours.
So, my blunt message is that if you ignore the following advice, you put your business at risk. It’s up to you!
Here it is – Understand the Contract:
1) Check and Understand The Contract
If you don’t check the terms and conditions of your contract eventually the Contractor will use those terms to screw you over! It might not have happened to you yet, but at some point it almost inevitably will.
Not all contracts are the same – some are extremely onerous – do not simply hope for the best. Make sure the key elements are clearly spelt out and understood.
There is no shame in not understanding contracts, no-one has the capacity to understand everything about their business and no doubt you have hundreds of other things to be concerned about, and probably employ other professionals to help you with other elements such as accounts. So why not get the contract checked?
Ensure that you give notice, at the time, of any event which is going to hold up your progress or cause additional cost to be incurred. Be clear and specific in your wording.
You must do what you need to do, when you need to do it, otherwise you will lose your entitlements!
Always get a written instruction from the person authorised to give instructions on behalf of the Contractor/Client before carrying out any additional work.
In all probability the contract will say that Instructions given to you verbally by the Contractor/Client are not valid. Therefore you must always confirm them back to him in writing or otherwise comply with the contract.
4) Obtain Agreement to Additional Costs
It’s easier said than done, but whenever possible get agreement to the costs of additional works before you carry them out. Otherwise, sit down regularly with the Contractor/Client to agree and sign-off any additional work costs.
Don’t wait until the end of the job before getting his agreement.
5) Final Account – Never Submit One!
You need to build-up your final account files from day one, but don’t submit it as a “Final Account” because you may fall into the contractual trap of them having literally months to respond to it.
But do keep on submitting interim applications.
Keep copies of all correspondence, cost information breakdowns, etc., together with site records relating to each individual variation. This will save an incredible amount of time and frustration at the end of the job, should a dispute arise.
Ideally you should produce and issue a issue a detailed programme for your works and monitor it daily/weekly depending on the size and circumstances of the project.
Even if you don’t produce your own programme, you must notify the Contractor if you are prevented from achieving progress, and ensure the causes of the delay are properly recorded. You may be telling him what he already knows, but you must still do it.
7) Records, Records, Records
So said a very learned construction lawyer and Arbitrator called Max Abrahamson.
You can never keep too many records – these will be invaluable in pursuing any payment or time entitlement should the other party not agree later on.
8) Take Action Early
Take action when you are not getting paid properly or on time. The sooner action is taken, the sooner you will get paid.
Most importantly, never allow an unpaid account or unpaid variations to go unresolved, as the problem is more than likely to grow rather than resolve itself.
9) Speak to a Senior Manager or Director
If discussions at site level are not addressing the problem, consider elevating the matter to a senior decision maker within the Contractor or Client’s business.
It is often the case that when site personnel become entrenched in their views, senior management are able to take a wider view and thus help to resolve the dispute without the need for adjudication or other proceedings.
10) Pick Up The Phone – Get Advice Sooner Rather Than Later
A phone call to obtain appropriate expert advice at the time a problem first arises will cost nothing in comparison to the cost of resolving a dispute later on.
You can speak to one of our experts free of charge on our friendly helpline on 01773 712116 or email firstname.lastname@example.org for a free no-obligation initial discussion, so that you can get a very quick idea of what we can do to help you.
And please do not think that if you are the boss you should automatically have all the answers. This is simply not the case. We have over 30 years of professional and practical experience of dealing with this stuff every day, helping Specialist Contractors to understand the contract, and we are here to help you.
Please Help Spread The Word – Understand The Contract
I hope you enjoyed this Wise Up Wednesday article and that it gave you some food for thought. If so, please help to spread the word within your own business and with your colleagues in other businesses. Specialist Contractors are the backbone of the industry and we are here to help you all stick together.
And if you want to get your contract checked or you need help with Acceleration, Adjudication, Applications and Payments, Business Development, Contractual Advice, Delay and Disruption, Dispute Resolution, Extension Of Time, Retention, etc., or any of your business issues, please don’t hesitate to pick up the phone and give our friendly Helpline a call.
Need Help To Understand The Contract?
For this, or anything else, you can contact us on 01773 712116 or email email@example.com. You can also find our Contact Us page here.