1. Change Orders:
Supervisory personnel on the job site should
be advised that no change order work is to be done
without a written order provided by the owner or the
owner’s representative. Forms acceptable to
the owner should be available on site for your supervisory
personnel to provide the owner with the costs associated
with a proposed change. If there is a dispute as to
whether the change order work is compensable, there
should be a provision in the contract allowing for
work to be done under forced account with an agreed
upon time and material price for labor and materials.
2. Photographs:
Photographs should be taken of site conditions,
as well as any problem area which may impact upon
the progress of the work. Before and after photographs
of work that has been corrected is important to protect
one’s position as to the claims by nonperforming
subcontractors. Photographs and videotapes of work
left uncompleted by a subcontractor are important
tools to assist in a litigation or
arbitration action that attempts to value the work
of that particular subcontractor. In determining whether
to use videotape or photographs, the image to be projected
must be considered. Frequently, a photograph will
allow an arbitrator or trier of fact to look at a
potential problem area as long as they desire. A videotape
typically lacks the ability to focus the individual
on a particular point for any extended period of time.
Actual work in progress is usually best shown in a
videotape.
3. Owner/Contractor Communication:
Correspondence sent by the owner referencing
alleged problems or concerns should always be responded
to by the contractor. The weekly progress meetings
or reports by the architect or other owner’s
representative should be responded to or amended by
the contractor or affected trade contractors when
the contractor believes the information contained
therein is inaccurate.
4. Daily Reports:
Daily reports should be kept by responsible
supervisory personnel. Information provided should
include the trade contractors on site; the number
of individuals on site for each trade and the work
being performed; weather conditions; and any particular
problems with the project should also be noted on
the daily report. If your supervisory personnel fail
to focus on the daily reports, these reports can sometimes
do more harm than good. The reports must accurately
reflect what is going on at the project site.
5. Notice of Commencement:
General contractors working in the state
of Georgia should always prepare, file and post a
notice of commencement of construction on the job
site and file the same with the Clerk of Superior
Court in the county the project is located. This notice
requires second tier subcontractors and material suppliers
to give notices to contractor and the owner on private
projects that they are supplying labor and material
for that particular project. This allows the general
contractor and owner to have an understanding of who
is actually working on the project and allows them
to keep track of whether the subcontractor or material
supplier has been paid. General contractors can ascertain
if there are payment problems between their subcontractors
and second tier subs or material suppliers.
Further,
failure by a second tier subcontractor or a material
supplier to a subcontractor to provide a notice to
contractor and owner on a private project results
in the waiver of that particular subcontractor’s
or material supplier’s right to file a lien
upon the property. This is a powerful tool in the
hands of a general contractor and no contractor should
ever do a job in the state of Georgia without filing
and posting an appropriate notice of commencement
of construction. The legal requirements of this particular
document can be obtained through your attorney in
the state of Georgia. The filing of a notice of commencement
of construction is required by statute on most public
projects. The failure of the second tier subcontractors
and material suppliers to send the statutory notice
will bar their claims on the contractor’s payment
bond.
The very nature of construction is that
when a job is recreated for review by a trier of fact
or arbitrator, the recreation occurs through visual
images and review of the paper trail prepared during
the construction project. Therefore, the careful documentation
of a contractor’s position with the backup for
the same must be part of the daily routine of a contractor.
Almost every construction project of any significant
size will foster at least one potential legal problem.
The better the documentation provided by you to support
your position, the more likely this dispute can be
resolved via negotiation to your satisfaction or result
in a favorable litigation or arbitration award to
the contractor.
No construction industry member can be
successful without understanding their legal obligations
and rights, the impact of the various construction
documents and their provisions, as well as an understanding
of the rights and obligations of the various parties
involved in the construction process. The ability
to file a lien upon the real property of an owner
on private projects and make claims upon payment bonds
on public projects provides trade contractors powerful
tools to protect their ability to recover amounts
unpaid for their work. The filing of liens and the
preparation of bond claims are areas in which any
contractor should seek legal assistance.