• Five Things Construction Attorneys Have to Master

    Attorneys are some of the most valuable members of a construction industry team. In the world of construction and contracting, there are a lot of complicated moving pieces that need to be kept track of. Here are just a few of the areas where builders and contractors need attorneys to help ensure a smooth construction process:

    Employment Law

    One important aspect of commercial real estate law is employment contracts, regulations, and codes. From April 2006 to January 2011, the construction industry suffered a downturn and was forced to eliminate more than 40% of the workforce. While this kind of a move can bring savings, it can also bring some serious headaches if everything is not done exactly according to the law and according to all regulations and contracts.

    Insurance Issues

    Attorneys for construction company must also be experts in all the different issues that might require insurance. Builders risk coverage, for example, covers a new building or building that is under construction or repair and is usually written for a minimum of one year. The ISO builders risk coverage form, CP 00 20, provides a simplified language version of commercial property risk coverage. Yet this is just one type of insurance issue that a construction attorney must be able to understand and advise clients concerning.

    Regulations and Codes

    Codes and regulations can vary wildly from place to place and are subject to change at any moment. If a construction company or contractor has just taken a job in a new area, it’s essential to bring in a lawyer to help navigate all of the local codes and regulations and ensure compliance.

    Contracts and Claims

    Contracts for builders and construction companies can be tremendously complex, yet they must cover all of the issues that face a builder or project. It’s important that the contract covers all contingencies, the payment schedule, the building schedule, who is responsible for what, and also discuss what the two parties agree to do in case there is a breach of contract claim or some other issue that requires arbitration.

    Arbitration

    Arbitration is the preferred method of dealing with issues in the construction industry because it is typically faster and far less expensive for all parties involved than taking a case the court. Yet here too it is important to have attorneys in on the process. An expert in construction law with a full understanding of the contracts involved is invaluable in ensuring a good outcome. Even with arbitration, the stakes can be huge. The American Arbitration Association has reported that the largest claim that was ever resolved by a single arbiter was for $232 million. The smallest claim was $23,000. In 2015, that same association oversaw 551 arbitration cases in the construction industry that had claims of over $500,000. The largest such case was worth $2.6 billion.

    This is just a small sampling of what attorneys in the construction industry have to be able to deal with and master in order to effectively assist those in the construction and building industries. Having the right commercial real estate law firm in on the process from the very beginning is crucial to making sure everything runs smoothly from the moment the first contract discussions begin to the day the project is finished.