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Liabilities for Construction Owners

This article in the Business Courier lists some areas of potential liability for owners of construction projects.

“As a construction owner, you can incur liability if you fail to recognize and comply with certain implied legal obligations, many of which spring from an implied covenant of good faith.  Simply put, this covenant states that neither party will do anything to injure the right of the other to obtain the benefits of the contract. An owner can be found to violate this covenant when acting intentionally, or in bad faith, to frustrate or delay a contractor.”

Here are some examples of items that an owner can provide to avoid of liability issues:

  1. Providing a contractor with all soil studies and relevant information.
  2. Provide the contractor with accurate plans and specifications.
  3. Include contractual language making the contractor the guarantor of the adequacy of the plans and specs.
  4. Obtain a peer review of the design documents.
  5. Respond promptly to extension requests.

“To avoid claims and unsatisfactory results, it is important to pay attention to implied obligations on construction projects. With careful planning and awareness of potential issues, you can help ensure a successful project for everyone involved.”

Read the full article here.

September 5, 2008 | Filed Under Construction Management 

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