Construction Law Alert: A Checklist for Construction Professionals As Heavy Building Season Gets Underway

By: Joshua R. Lorenz, Construction Law Group Vice Chair

As weather warms and winter becomes a memory, construction projects are ramping up in frequency and job sites will see increased productivity. It makes for a good time for construction industry professionals to take a look at where their business stands.

Whether you’re a contractor, subcontractor, or project owner, you might want to use this checklist to get started on that path:

1. Past projects

What projects have been the most successful in recent years? What projects did not go as well as expected? Why?

A little self-reflection goes a long way. You want to recognize what made your successes work – e.g., good partnerships, adopting new and effective technology and processes – and what happened on projects that may have progressed poorly – such as substandard work or even arbitration/litigation.

2. Industry trends

It’s good business to keep abreast of what is new and exciting in your industry. Take the use of drones, for example. Once a novelty, these devices are now common on job sites and  growing in popularity. As a result, owners and contractors, in particular, should begin to factor this technology in their agreements, incorporating language for following regulations, setting forth insurance requirements and providing for indemnification. As other trends advance, so, too, should contract documents.

3. Legal changes

When changes in the law occur, business as usual won’t cut it for those who haven’t been paying attention. Perhaps more important than industry trends, the legal landscape is important to follow.

Pennsylvania had a good example in the past year with amendments to the Contractor and Subcontractor Payment Act (CASPA), altering key construction statutes that should be reflected in standard contracts. Ignoring these types of changes or new case law rulings could prove costly.

4. Business relationships

Take stock of your business relationships. There will probably be positive and negative observations – a certain general contractor might submit bids that are higher than others, but their work is superb, so they might provide better value. On the other hand, maybe a supplier you’ve used has a great product but consistently is late on orders. It might be time to make a change.

Taking a close look at these issues and adequately addressing them is key to minimizing problems and enhancing future success. Letting problems continue and escalate isn’t good for anyone.

5. Risk management

Construction is a pressure-filled industry. Be it the stress of meeting project deadlines, the competition for work, safety hazards or labor issues, inherent risks are everywhere. Unsuccessful projects that end in fiscal loss or formal disputes may stem from incorrectly managing those risks. Ask yourself if a project is out of your comfort zone, if you’ve identified all risk areas, and if you have the proper protections in place.

When considering what risks to take on, as well as the other items on this checklist, it’s not enough to just think about them. There are tangible solutions to your current and potential problems that you can implement now, and trusted legal counsel can help you find them.

For more information, please contact Josh Lorenz. A link to his contact information is included below.
This material is for informational purposes only.  It is not and should not be solely relied on as legal advice in dealing with any specific situation.
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