Key Construction Contract Terms
There are many risk shifting, risk alleviating and/or risk sharing clauses that should be read carefully. Below are some of the more important ones to read first when reviewing a contract.
Most construction contracts require the contractor to submit written notice to the owner or architect within a defined period of time after an event arises causing a change in time or cost to the contact. Such notice requirements are requirements are imposed to protect the interest of the owner, who may be unaware of the causes of a particular event. Failure to provide notice may result in the waiver of the contractor’s rights. Section 4.3.2, 4.3.5 and 4.3.7 of the standard AIA A201 contract document defines the necessary steps and time frame to notify the owner of potential changes in cost or time to the contract.
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