The construction industry is one of the most important in the state of California and the entire country for obvious reasons. When a contractor or construction company has a bid accepted, it can then begin to work on the contract. There are four common types of construction contracts used in the industry today.
Entering into a contract for construction is an exciting time for all involved. It can also be a stressful time. Everyone involved might not know what to expect once the contract is signed, even if it is all laid out in black and white. One of the more difficult issues to deal with when it comes to contracts is a contract dispute. Here are some tips for avoiding breach of contract issues in California.
In a series of posts, our blog has been discussing how licensed California contractors must be aware that the complaints of aggrieved parties -- from homeowners and employees to subcontractors and fellow contractors -- may be resolved via alternative dispute resolution.
In a previous post, we explained how licensed contractors in California must be aware that homeowners, subcontractors, employees or fellow contractors may choose to address grievances with the Contractors State License Board.
It's important for licensed contractors here in California to understand that the courtroom isn't the only forum in which they might need to address the complaints of homeowners, subcontractors, employees or fellow contractors.
From developers and architects to general contractors and construction management agencies, ask any experienced party and they will tell you that the process of constructing any structure is at best an inexact science.
A complex technology lawsuit involving a Pakistani American entrepreneur living in San Juan Capistrano and one of the largest banks in Dubai, United Arab Emirates, is set for trial in July in federal court in Santa Ana. The lawsuit stems from a contract dispute about a plan to sell money transfer services in third world countries using cell phones and a form of pre-paid credit cards.
One of the greatest financial risk for a building contractor is not receiving payment from the project owner. California law provides two major protections for parties who provide labor, material or services in connection with construction projects: mechanic's liens and stop work notices. Both processes are intended to ensure that contractors, sub-contractors, suppliers and laborers get paid, but each works in a different manner. We will cover stop work notices in this post, and we will deal with mechanic's liens in a later installment.
Most California businessmen understand that a breach of contract may entitle them to recover damages or may expose them to a lawsuit aimed at recovering damages caused by the breach. However, very few business owners understand how much or how little money may actually be recovered if a contract dispute results in a lawsuit.
Most California contractors understand that filing a mechanic's lien is an effective way to guard against non-payment for work. To be effective, a mechanic's lien must be filed in the county where the work was performed within 60 days after completion of the work. Notice must also be given to the owner and to other potential lien claimants. Despite these protections, non-payment (or partial payment) for work is a common cause of contract disputes. Supposing that a contractor has complied with all of the statutory requirements necessary to create an effective lien, but still no payment is forthcoming. Now what happens?