A contractor on a Dillard University construction project is being sued for breach of contract by a subcontractor for nonpayment for services provided. On Sept. 26, 2014 the Ellis Company LLC filed suit in a New Orleans district court against Gibbs Construction LLC and Western Surety Company, claiming that according to a 2012 contract Gibbs agreed to pay Ellis some $270,000 for services that the subcontractor provided Gibbs.
The amount covers labor, roofing, waterproofing, masonry and other services Gibbs received from Ellis, including an additional fee Gibbs agreed to pay for a change order it requested. Ellis alleges that the defendant has failed to pay them any part of the owed monies, despite having received numerous invoices. Ellis also claims that Gibbs has profited off the work completed in the project, while failing to hand over any of the project’s revenue, in direct violation of its subcontract agreement.
Ellis is suing Gibbs for the full amount of the contract. This is a very common fact pattern in construction disputes. A well written contract will make or break the final outcome of this dispute.
Know the Terms of Your Contract
Whether your business is on the supplying or receiving end of a construction contract, the last thing you need is to be caught unaware by a disagreement over contractual terms that lead to a breach of contract suit.While it may be difficult to sort through the maze of language contained in a construction contract, you need a well-written contract in which the terms and description of work performed is clearly written and understood by both parties. A good construction attorney can help here.
When writing a construction contract, the finished product needs to be described in full detail, and all blueprints and work plans need to be understood by both parties and brought under the contractual umbrella.Although statutory building codes may ensure that the construction conforms to state and local standards, a project will often have unique functional requirements. This means that any kind of testing parameters or procedures used by the contracting party, as well as the standards or benchmarks that they will use to verify the fidelity of the finished work, need to be stipulated in writing for every part of the project.
In order to manage misunderstandings that may arise in the course of the project, the contract should also contain a full materials list and all delivery schedules that the contracting party expects the vendor to adhere to. The complexities of a construction contract can fill up text books, much less this short blog post. In these situations an ounce of prevention is an ounce of cure.
Rely on Construction Law Specialists to Ensure a Foolproof Contract
Whether you are a property developer, general contractor or subcontractor, an attorney who practices in construction law, can help you make sure that your contracts are as sound as the structures you build. Contact the construction law attorneys at Smiley Law before signing your next contract.