Commercial construction can be a relatively lucrative industry. The companies providing commercial construction services often have to worry less about clients defaulting on their payment obligations. Additionally, commercial construction projects tend to have a higher overall price point, meaning that they offer more opportunities for profit.
Unfortunately, organizations hiring commercial construction firms can be very demanding clients. They may take issue with any deviations from the contract, including delays in project completion. Business clients could theoretically file lawsuits against construction firms for substantial delays, as those delays could lead to additional operating expenses or a loss of company revenue for the client.
How can commercial construction firms minimize the risk of a client filing a lawsuit in response to delayed project completion?
Include the right terms in the contract
The contract for the project likely includes numerous key details, including a proposed timeline for the project. Construction firms often need to allow for unanticipated challenges by including a buffer in the project timeline in case of unexpected delays. Pushing out the final completion date and adding a few extra days to each stage of the project can help reduce the likelihood of the client feeling frustrated by how long the project takes to complete. Additionally, contracts may need to include standards for communication and rules for alternative dispute resolution so that clients don’t immediately file lawsuits when they become frustrated. Contractual details can potentially minimize the risk of a frustrated commercial client taking a project delay issue to court.
Control as many aspects of the project as possible
From having backup subcontractors available if initial arrangements fall through, to having alternative vendors already researched, there are many ways for construction businesses to proactively address the possibility of disruptions. That being said, even the most forward-thinking construction professional can’t control international conflicts, inclement weather and other abnormal circumstances. Communicating promptly with commercial clients about uncontrollable factors that could delay project completion can reduce the possibility that a frustrated client may decide to take legal action against the company.
Those helping run construction firms should have plans in place for even the most unusual worst-case scenario. Negotiating appropriate contract terms and planning to offset potential delay risks can help those in commercial construction minimize the likelihood of a client taking them to court over project delays.