General contractors and construction managers are central players in almost every construction project, large or small. They are the “quarterbacks” of construction projects. They face legal and contractual issues on two fronts: (1) “Upstream” in their relationships with project owners; and (2) “downstream” in their relationships with subcontractors and suppliers.
Upstream challenges include:
- complex project scheduling
- pricing and delivery systems
- interfaces with the Owner’s design team (architects, engineers, and consultants)
- contemporaneous responses to constantly changing project conditions
Downstream challenges include:
- effective management of a multi-tiered system of subcontractors and suppliers
- site safety and security
- interactions with government agencies having jurisdiction over the project
- coordination with other contractors
The success or failure of a project begins prior to contracting. Our lawyers have many years of experience in contracting and front-end project management on a wide array of construction projects, from commercial, infrastructure, and manufacturing to health care, institutional, and multi-family. This experience is invaluable in helping contractors and construction managers identify, assess, and manage the risks of construction projects in their contractual relationships, both upstream and downstream. We also provide critical advice related to project insurance, payment and performance bonds, and other risk mitigation devices to help the businesses of contractors and construction managers remain secure during project performance.
Once projects begin, they are rarely free of problems. Despite a contractor or construction manager’s best efforts, most projects involve disputes of some kind, such as change order negotiations, disagreements with project owners and designers, and subcontractor defaults or non-performance. The method by which contractors and construction managers deal with these issues is often a strong determining factor in a project’s ultimate success or failure. Many times, situations call for a “measured response” that endeavors to “keep the peace,” while, at the same time, protecting the contractor or construction manager’s legal rights and remedies. Our lawyers are highly experienced in negotiating and are adept at counseling our clients as to the proper response to project claims and disputes.
We spend time understanding the businesses of our clients, because there is, very often, a difference between the “legal” response and the response that will resolve issues in the best interests of our clients. Our lawyers work diligently to find that balance.
Sometimes, claims and disputes cannot be resolved amicably during a project or shortly thereafter. If litigation or alternative dispute resolution proceedings (mediation and arbitration) become necessary to bring an end to claims and disputes or to collect amounts due to our contractor and construction manager clients, our lawyers have the skill and experience necessary to litigate effectively and efficiently. We have handled construction cases in all venues, including state and federal courts, boards of contract appeals, procurement review boards and panels, and arbitration.
With the COVID-19 pandemic and newly elected officials taking office, there are many uncertainties about what 2021 will bring to the construction industry. However, one certainty is that contractors will need to preserve their lien rights to ensure they are paid on construction projects if problems arise. Attorney Jeff Reichard discusses lien rights in North Carolina as they relate to subcontractors, specifically first-tier subcontractors.