{"id":904391,"date":"2025-05-29T17:06:21","date_gmt":"2025-05-29T23:06:21","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=904391"},"modified":"2025-05-20T17:12:50","modified_gmt":"2025-05-20T23:12:50","slug":"construction-contract-what-to-include-to-prevent-delays-and-cost-overruns","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/construction-contract-what-to-include-to-prevent-delays-and-cost-overruns\/","title":{"rendered":"What To Include In A Construction Contract To Prevent Delays And Cost Overruns"},"content":{"rendered":"\n<p><a href=\"https:\/\/www.lawayala.com\/construction-contract-delays-and-cost-overruns\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Ayala Law<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.lawayala.com\/financial-losses-for-contractors\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>Construction projects are notorious for going off schedule<\/strong><\/a>\u00a0and over budget. If you\u2019re a property owner, developer, or contractor in Florida, you already know how easily timelines can slip and costs can balloon. But many of these issues can be avoided\u2014not on the job site,\u00a0<a href=\"https:\/\/www.lawayala.com\/how-to-draft-a-construction-contract\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>but in the contract.<\/strong><\/a><\/p>\n\n\n\n<p>At Ayala Law, we\u2019ve helped clients handle the legal consequences of vague or incomplete construction contracts. In this blog post, we\u2019ll break down exactly what to include in your <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/preventing-and-resolving-construction-disputes-types-of-damages-in-construction-contracts\/\">construction contract<\/a> to protect your project, your budget, and your time.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Why Do Construction Projects Go Over Budget or Run Behind?<\/strong><\/h4>\n\n\n\n<p>Before diving into contract terms, it helps to understand what causes construction delays and cost overruns in the first place. In our experience, the most common reasons include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Poorly defined scope of work<\/li>\n\n\n\n<li>Miscommunication between parties<\/li>\n\n\n\n<li>Weather or material shortages<\/li>\n\n\n\n<li>Delays in permitting<\/li>\n\n\n\n<li>Payment disputes<\/li>\n\n\n\n<li>Change orders without clear procedures<\/li>\n<\/ul>\n\n\n\n<p>Many of these problems can be anticipated and managed in the contract itself\u2014if the right language is in place.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>What Clauses Should Be Included in a Construction Contract to Avoid Delays?<\/strong><\/h4>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>1. Clear Scope of Work and Specifications<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cWhat should a construction contract include?\u201d<\/em><\/p>\n\n\n\n<p>Start with a clearly defined scope of work. Vague descriptions lead to misaligned expectations, disputes, and change orders. Your contract should include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A detailed description of all tasks and deliverables<\/li>\n\n\n\n<li>Specific materials and quality standards<\/li>\n\n\n\n<li>Architectural plans and engineering drawings as attachments<\/li>\n<\/ul>\n\n\n\n<p><strong>Why it matters:<\/strong>&nbsp;The more clarity upfront, the less room there is for disagreement later.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>2. Project Timeline and Completion Deadlines<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cHow to prevent construction project delays?\u201d<\/em><\/p>\n\n\n\n<p>Include a realistic construction timeline with:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Start and end dates<\/li>\n\n\n\n<li>Milestone dates for specific phases<\/li>\n\n\n\n<li>Allowances for weather or permitting delays<\/li>\n\n\n\n<li>Penalties for missed deadlines (a \u201cliquidated damages\u201d clause)<\/li>\n\n\n\n<li>Bonus incentives for early completion (optional)<\/li>\n<\/ul>\n\n\n\n<p><strong>Tip:<\/strong>\u00a0Define what constitutes a \u201c<a href=\"https:\/\/www.procore.com\/library\/substantial-completion\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>substantial completion<\/strong><\/a>\u201d and how final inspections will be handled.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>3. Payment Schedule and Conditions for Payment<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cConstruction payment terms in contracts\u201d<\/em><\/p>\n\n\n\n<p>Disputes over payment are a leading cause of delays. Avoid this by clearly laying out:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>When payments are due (e.g., at milestones or monthly)<\/li>\n\n\n\n<li>What documentation is required for each payment (e.g., lien waivers, invoices)<\/li>\n\n\n\n<li>Whether retainage will be withheld (typically 5\u201310% until final completion)<\/li>\n\n\n\n<li>Consequences for late payments<\/li>\n<\/ul>\n\n\n\n<p><strong>Bonus clause to consider:<\/strong>&nbsp;Add a \u201cpay-when-paid\u201d or \u201cpay-if-paid\u201d clause to clarify your obligations in subcontractor relationships.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>4. Change Order Procedures<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cHow to handle change orders in construction contracts?\u201d<\/em><\/p>\n\n\n\n<p>Change orders are one of the top reasons for budget overruns. A good contract includes:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A written process for requesting and approving changes<\/li>\n\n\n\n<li>Clear cost impact assessments before any work begins<\/li>\n\n\n\n<li>Timelines for reviewing and approving changes<\/li>\n<\/ul>\n\n\n\n<p>Avoid oral or informal change orders\u2014they lead to misunderstandings and disputes.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>5. Dispute Resolution Clause<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cWhat to do when there\u2019s a dispute in a construction project?\u201d<\/em><\/p>\n\n\n\n<p>Even with the best planning, disputes can happen. Your contract should specify how they\u2019ll be resolved:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.lawayala.com\/how-does-mediation-work-in-business-disputes\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>Mediation<\/strong><\/a>\u00a0as a first step<\/li>\n\n\n\n<li><a href=\"https:\/\/www.lawayala.com\/ayala-obtains-295000-arbitration-award\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>Arbitration\u00a0<\/strong><\/a>or litigation as a follow-up<br>Choice of jurisdiction and governing law<\/li>\n<\/ul>\n\n\n\n<p>In Florida, many contractors and owners opt for mandatory mediation before filing a lawsuit. It can save time and money.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>6. Force Majeure and Delay Clauses<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cWhat happens if construction is delayed due to weather?\u201d<\/em><\/p>\n\n\n\n<p>In Florida, hurricanes, heavy rain, and supply chain issues can disrupt a project. Include a\u00a0<a href=\"https:\/\/www.lawayala.com\/force-majeure-clauses-delayed-construction\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>force majeure clause\u00a0<\/strong><\/a>that addresses:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>What events qualify (e.g., natural disasters, government shutdowns)<\/li>\n\n\n\n<li>Extensions allowed for certain delays<\/li>\n\n\n\n<li>Notice requirements if such delays occur<\/li>\n<\/ul>\n\n\n\n<p>This protects both parties from being unfairly penalized for circumstances outside their control.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>7. Termination Rights<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cCan I cancel a construction contract?\u201d<\/em><\/p>\n\n\n\n<p>Include terms that outline:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>When either party can terminate the contract<\/li>\n\n\n\n<li>What happens to payments, materials, and work completed<\/li>\n\n\n\n<li>A required notice period for termination<\/li>\n<\/ul>\n\n\n\n<p><strong>Why it matters:<\/strong>&nbsp;If the relationship breaks down, this clause prevents chaos and outlines a clean exit strategy.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>8. Insurance and Licensing Requirements<\/strong><\/h5>\n\n\n\n<p><strong>Search term match:<\/strong>&nbsp;<em>\u201cDo contractors need insurance in Florida?\u201d<\/em><\/p>\n\n\n\n<p>Protect yourself from risk by requiring:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Proof of general liability and workers\u2019 comp insurance<\/li>\n\n\n\n<li>State licensing compliance for all contractors and subcontractors<\/li>\n\n\n\n<li>Bonding, if applicable<\/li>\n<\/ul>\n\n\n\n<p>Without this clause, you could be exposed to serious financial and legal liabilities.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Final Thoughts: A Solid Construction Contract Is Worth the Time<\/strong><\/h4>\n\n\n\n<p>We often hear from clients after problems arise. In many of those cases, the issue could have been avoided with a stronger, more detailed contract at the start. A well-drafted construction contract is not just a formality\u2014it\u2019s your first and most effective tool to prevent delays, control costs, and minimize disputes.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes &#8211; please call Advise &amp; Consult, Inc. at 888.684.8305, or email <a href=\"mailto:experts@adviseandconsult.net\">experts@adviseandconsult.net<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Ayala Law Construction projects are notorious for going off schedule\u00a0and over budget. If you\u2019re a property owner, developer, or contractor in Florida, you already know how easily timelines can slip and costs can balloon. But many of these issues can be avoided\u2014not on the job site,\u00a0but in the contract. At Ayala Law, we\u2019ve helped clients&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/construction-contract-what-to-include-to-prevent-delays-and-cost-overruns\/\">Continue reading <span class=\"screen-reader-text\">What To Include In A Construction Contract To Prevent Delays And Cost Overruns<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[9],"tags":[9895,224],"class_list":["post-904391","post","type-post","status-publish","format-standard","hentry","category-construction-contracts","tag-advise-consult","tag-construction-contract","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What To Include In A Construction Contract To Prevent Delays And Cost Overruns - Advise &amp; 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