Construction Contract Provisions Every Florida Contractor Should Understand

By Aaron Haak, Esq., Florida Board Certified Construction Attorney

Every construction project begins with a contract, but not every contractor takes the time to review what that contract actually says carefully. While most contractors focus on the scope of work and the contract price, some of the most important provisions are often found in the written terms and conditions or “boiler plate” provisions.

A well-drafted construction contract does more than describe the work to be performed and the price to be paid. It establishes each party’s rights and responsibilities throughout the project and can substantially affect the outcome of a payment dispute, project delay or extra work claim.

Whether you are a general contractor, subcontractor or supplier, understanding your contract before work begins can help protect your business, preserve your right to payment and reduce the possibility of costly construction disputes.

Why Is a Clear Scope of Work Important?

Many construction disputes begin with one simple question:

“Was this work included in the contract?”

A clearly written scope of work should identify the services to be performed, the materials to be provided, project specifications for the work to be performed, and any work specifically excluded from the agreement. Vague or incomplete language can lead to disagreements over whether additional work was included in the original contract or should be treated as a change order.

Taking the time to clearly define the scope of work before construction begins establishes expectations for everyone involved and reduces the potential for misunderstandings later in the project.

What Payment Terms Should Florida Contractors Review?

The contract price is important, but so are the terms that explain when and how payment will be made.

Before signing a construction contract, contractors should understand when payment applications are due, what documentation must accompany a payment request, whether retainage will be withheld and what happens if payment is delayed.

Florida law may also provide statutory protection in certain circumstances. For example, Section 715.12, Florida Statutes, commonly referred to as Florida’s Construction Contract Prompt Payment Law, establishes payment requirements for qualifying written construction contracts and addresses the consequences of untimely payments.

Understanding both your contractual rights and any applicable statutory protections can help avoid unnecessary payment disputes.

Why Should Every Change Order Be in Writing?

Few construction projects proceed exactly as originally planned. Owners often request additional work to be performed, unforeseen site conditions arise, and project specifications evolve as construction progresses.

Your contract should establish how changes to the project will be approved, documented and priced before additional work begins. While verbal agreements may seem efficient at the time, they can quickly become the source of disagreement when the final invoice is submitted.

Consider This Scenario:

During a commercial renovation, an owner asks the contractor to relocate several interior walls after framing has already begun. Wanting to keep the project moving, the contractor performs the additional work without obtaining a written change order. When the final invoice includes the added labor and materials, the owner disputes the charges, claiming the work was included in the original contract. A written change order documenting the revised scope of work and additional cost could have helped prevent the dispute.

What Should Your Construction Contract Say About Delays?

Construction delays are often unavoidable. Severe weather, permitting issues, labor shortages, supply chain disruptions and owner-requested changes can all affect a project’s schedule.

A construction contract should explain how delays will be handled, when a contractor may be entitled to additional time and whether written notice is required to preserve contractual rights.

Many contracts contain strict notice requirements. Failing to comply with those provisions may affect a contractor’s ability to seek additional time or other contractual remedies.

When Can a Contractor Suspend Work or Terminate a Contract?

No contractor begins a project expecting to suspend work or terminate a contract. However, circumstances sometimes make those options necessary.

Every contractor should understand when work may be suspended, whether advance written notice is required, when either party may terminate the agreement and what compensation remains due if the project ends before completion.

Contractors should never assume they can stop work because payment has been delayed. Likewise, owners should ensure they comply with the contract before attempting to terminate the agreement. Understanding these provisions before a dispute develops can help preserve legal rights and avoid making an already difficult situation even more complicated.

Bottom Line

A construction contract is much more than a pricing document. It establishes the framework for the entire project and often determines each party’s rights if a dispute arises.

In addition to the terms of the contract, Florida contractors should also be familiar with Chapter 713, Florida Statutes, Florida’s Construction Lien Law, which provides important rights and remedies relating to payment on construction projects. However, the strongest protection often begins before work starts with a carefully drafted and thoroughly reviewed contract. Learn more in a related article, “When Can a Construction Lien Be Asserted in Florida?”

Taking the time to understand your contract before signing it can help minimize risk, protect your right to payment and keep your project moving forward.

If you have questions about negotiating a construction contract, resolving a payment dispute or protecting your rights under Florida law, I may be reached at aaron.haak@henlaw.com to schedule a consultation.