completion costs

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When an owner terminates a prime contractor or a prime contractor terminates a subcontractor, it almost always costs more for the terminating party to complete the work under the contract. Fortunately, if the termination was proper, the owner should be able to recoup the extra cost to complete the work from the terminated contractor. The same is true when a contractor terminates a subcontractor.

Often, the terminated party will argue that the excess completion costs were unreasonable. Generally, the burden will be on the terminated party to prove that the cost to complete the work was unreasonable. This can be very difficult to prove.Continue Reading Construction Completion Costs and the Burden of Proof

Willie Nelson supposedly quipped the following about divorce: “Why is divorce so expensive? Because it’s worth it!” The same can be true of an owner looking to “divorce” a prime contractor or a prime contractor looking to part ways with a subcontractor on a construction project.

But much like divorce, the termination of a contractor should only be considered where all faith has been lost in a contractor to perform its obligations under the parties’ contract. This is because terminating a contractor has been said to be the most drastic of sanctions.Continue Reading Four Things to Consider Before Terminating a Construction Contract