We’ve all heard horror stories about how what was supposed to be a straightforward home renovation blew through its budget and time restrictions after unforeseen problems turned up during construction. And, the larger the construction project, the more chances there are for these problems to arise.
Because of this possibility, it’s common for all construction contracts to include a “scope of work” provision. This term refers to the section of a contract that details the expectations of the client and the contractor. If done correctly, it can protect all parties to the contract. It limits the possibility that the costs and timeframe of the project will go way beyond the client’s budget, and also helps the contractor to keep its costs and commitment under control.
What should be included?
Scope of work agreements should be tailored to the unique goals of each construction project, but there are certain items that should be a part of every contract. These include:
- An overview of the project: This may be a broad description or a more detailed explanation of what the finished project will look like, and what it is meant to achieve.
- A schedule: This may give a loose timeframe for how long the project should take. However, it should also include smaller deadlines, including expectations for certain milestones.
- Business details: This section of the contract should include details of project management, such as how payment must be handled and guidelines for safety inspections. It should also provide details of how the parties will handle changes when or if they arise. It may also provide a method for resolving disputes.
Generally speaking, the more detailed the scope of work agreement is, the better. Every party to the contract can benefit from clear expectations and guidelines. However, it may be impossible to plan for every contingency and unexpected development that could possibly arise.
Scope of work disputes
In fact, it’s quite common for construction litigation to revolve around scope of work disputes. When these come before courts, judges typically start by looking at the language of the contract itself. If the dispute involves something that is not mentioned in the agreement, or if the relevant language is ambiguous, the court may look at other factors. These may include the relevant business histories of the parties or even the standard business practices in the industry.