Prior to initiating operations on a new project, company owners may first wish to protect their interests by setting clear terms for the arrangement via a legally binding agreement. As construction contracts can come in various forms, knowing which type of agreement best fits the situation prior to moving forward could be essential. While company owners in New York may feel that better understanding their options could be vital to making informed choices, they might not always know how to achieve this goal.
Common types of contracts
Experts indicate that one of the most common types of construction agreements involves a fixed price contract. With such an arrangement, the parties involved must agree on a fixed price for all project costs, while still having the option to add terms on possible incentives and dispute resolution. While cost plus contracts may also require parties to agree on certain payment amounts in advance, these agreements could also cover topics pertaining to the various costs associated with construction operations.
Another potential option involves a time and material contract, in which both parties may seek to negotiate acceptable terms for hourly or daily rates. These contracts can also cover expenses stemming from project costs. Unit pricing contracts are another common type of agreement that may typically be more common when project owners wish to set a predetermined rate and put the project up for bid.
Choosing the best path
There are various factors that could influence what type of construction contracts may prove preferable in each scenario, such as lack of clarity on project scope. Those who wish to choose the best path to help protect their interests could benefit from retaining the services of an attorney for advice on all their options. An attorney in New York can help a client address each available option and assist him or her in choosing the type of construction contract that best aligns with the interests of the company.