spot_img

What Commercial Builders Get Right: Get it in Writing

Date:

Share post:

I reviewed a risk management outline I drafted years ago for a client considering a multifamily project. What jumped out at me was the number of times I referred to the concept of getting it in writing.

“Carte si face, perche uomo e fallace.” This quote, which goes back to the Florentine Renaissance and means “Cards are faced, because men are fallacious,” has something to teach today’s home builders. To help me identify a topic for this article, I reviewed a risk management outline I drafted years ago for a client considering a multifamily project. What jumped out at me was the number of times I referred to the concept of getting it in writing.

Commercial versus residential documentation

One thing that has struck me throughout my career is the difference in documentation in a commercial project versus a residential project. In the commercial setting, rarely is something not documented. There are few facts about which attorneys can argue when litigating a commercial construction case. Critical issues are often clearly documented, creating a factual record.

When litigating residential cases, it seems like there are exponentially more questions about disclosures and the actual construction. Unfortunately, these gaps are often filled in with witness testimonies. I cannot tell you how many times I have heard a subcontractor testify that “I know I did not follow the plans, but the superintendent told me he knew of the problem and instructed me to do the best I could.” Without written evidence, it is easier to make up a narrative to fit the story you want to tell. Even if that narrative is true, from the subcontractors’ perspective, it would be better to have supporting documents, even if just an email stating “you are instructing me not to build in accordance with the plans, and I will not be held responsible for the result.”

RELATED: Attorneys’ Fee Clauses are Engraved Invitations to Sue

I am not suggesting that residential builders have to adopt all commercial construction practices when it comes to documentation or shoulder the cost of those practices. What I am suggesting is that residential builders should take time to identify those issues, which, if not documented, will serve as an Achilles’ heel during litigation, and create streamlined processes to document those issues. In the example from the previous paragraph, this could be as simple as creating a form for subcontractors to sign, along with their monthly lien waivers, certifying that they have performed their scope of work in accordance with the construction documents and have received no instruction from the builder to the contrary. While I have not seen this approach used yet, I believe it bears consideration.

While there is no perfect answer, perfection should not be the enemy of progress. Start today by identifying the crucial issues that would benefit from documentation and devise systems and processes to efficiently and effectively document them.

Get this in writing

Some crucial steps and processes that builders should document include the following:

  • Terms of the purchase and sale agreement
  • Warranty terms and process
  • Disclosures regarding expansive soils
  • Subcontract terms
  • Scopes of work for various subcontractors
  • Homeowner changes
  • QA/QC process
  • Pre-closing walkthrough
David McLain
David McLainhttps://www.hhmrlaw.com/
Please feel free to reach out to me at (303) 987-9813 or by email at [email protected] if you would like to explore revamping your building practices in order to make yourself a hardened target.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Related articles

Number of Women in Construction is Growing–Albeit Slowly

The opportunities and demand for women in residential construction have never been greater, even if growth is happening at a snail’s pace.

Finding Inspiration at the Women in Residential Construction Conference

Leadership Reimagined, the 8th annual Women in Residential Construction (WIRC) conference, was held in October in San Diego.

Female Influence Benefits Construction Industry

Women have made great strides in the industry, at all levels, in roles that include ownership/management, technical positions,...

Women Adding Value to the Construction Industry Every Day in Every Way

Today, more than at any time in the history of our construction industry, we are experiencing more women...