One of the most commonly asked questions in the construction world is if a construction contract should always be recorded in writing. This is a very important question that should be answered by an attorney with experience in construction law.
It is not required by law in most jurisdictions to have a construction contract in writing. For the most part, when a construction contract falls within a statute of fraud in California, it will need to be in writing in order for it to be enforced.
What is a statute of fraud? A statute of fraud is in place to prevent claims that can be fraudulent involving the contract. This is especially important when it comes to claims made against large contracts. There are instances when construction contracts will fall within the statute of fraud, which means they must be in writing and can be enforced.
Some of the situations where a construction contract must be in writing include the following:
- Construction projects that cannot be completed in one year or less
- A construction loan contract
- A contract for the sale of an improved property
- Contracts that involve the sale of construction equipment
Even if your construction project does not fall into one of the categories mentioned above, it's still a good idea to get it in writing. You will have a clearcut document to refer back to when an issue arises.
Are you preparing to enter into a construction contract? No matter the area of construction, residential or commercial, you should be sure it is in writing with the help of an experienced construction law attorney in Orange County.