"Pay me less before the dispute erupts … or pay me more after the dispute erupts …" is a phrase that many construction litigators have said to their clients.  What that means, practically, is that if you invest the time and money to have your attorney review construction contracts before the job starts, you will save time, money and effort later when the dispute begins (and perhaps you may even fend it off). Despite the warnings, there are many out there who want to "go it alone" … and that’s okay.  This post is for you.

Learn to Write Better

The American Bar Journal posted an article two weeks ago about a federal bankruptcy judge who was fed up with "superfluous words and too much capitalization."   The judge took a stand against legalese and issued some guidelines (pdf) to the practicing bankruptcy attorney.  Some of my favorites include:

  • Lawyers apparently disfavor articles, both definite and indefinite. Use the
    articles “the,” “a,” and “an” as appropriate.
    Write the way you would speak.
  • Never use and/or.
  • Eliminate superfluous words. They serve no purpose other than to make the
    document sound more legal … Examples of such words are: “hereby,” “herein,”
    “in and for,” “subject,” “that certain,” “now,” “that,” “undersigned,”
    “immediately,” “heretofore entered in this case,” “be, and hereby is”–the list
    goes on and on.
  • Keep plurals and possessives straight and consistent. Know when to use
    debtors (plural), debtor’s (singular possessive), and debtors’ (plural
    possessive). Make sure the verb matches the subject of the sentence.

You can tell by the terse language in the judge’s guidelines that he likes clarity and he wants litigants (and particularly their attorneys) to follow those guidelines.  If I were a construction litigator … which I am … I wonder what my suggested guidelines would be for construction contracts.  Here are a few:

  • Keep the names consistent.  I know this will take some searching and replacing in your form contracts, but it is important to track the parties’ names correctly.  Many times, I have found a "subcontractor" listed as "contractor" in one section and "subcontractor" in another section.
  • Identify the "contract documents" for the parties.  Too many disputes arise because someone thinks the proposal or purchase order is part of the parties’ agreement only to learn later that it has not been incorporated as part of the contract documents.  Many form contracts have an "order of precedence" clause that ranks the precedential value of the documents in the event of a dispute.  Make sure to expressly include every document that you want into the contract documents.
  • Evaluate and clarify the "dispute" provisions.  Again, I have seen a number of lawsuits between parties spend too much time on the procedural issues such as litigation, arbitration, mediation (because the contract was not clearly written), rather than getting to the heart of the matter.  Make sure your contracts clearly identify your method of dispute resolution.

Do you have any other guidelines for your construction contracts?

Photo: Flckr – LucasTheExperience