Sign Here: The Biggest Mistake Glazing Contractors Make When Signing a Contract

By Karalynn Cromeens

The glazing industry is a tough one to navigate. There are many things to learn and look out for that nobody teaches you when you’re just starting. Some issues even persist and interfere with seasoned glazing contractors. One of the biggest issues I see among all contractors is contract-based. Namely, people keep signing things they don’t understand. Now I know, I know; legalese is hard and confusing, and it doesn’t make a lot of sense. That’s why I’ll break down some of the most problematic clauses people sign off on without knowing what they are committing to.

Bid Vs. Scope

These first items probably sound familiar, bid and scope. Knowing what they are isn’t the issue. The problem I see most often is that glazing contractors will submit a bid for a specific price, get a contract and sign off on a scope for that dollar amount without re-reading the scope. They then overlook project-altering additions to the scope. This usually happens because glazing contractors assume that the scope of the contract is the same as the bid they’ve submitted, but that’s not always the case. The bid is NOT the scope, despite what you may think.

Don’t let yourself get duped by simple oversight. Review the scope in every contract like you are reviewing a new bid. Make sure it matches up with what you’ve budgeted, and if it doesn’t, adjust the cost attached and let the client know why you need to adjust. Don’t just sign on the dotted line when you see the numbers lining up. Don’t make the same mistake. Be sure you review this area of your contract thoroughly.

The Pay When Paid Clause

Another common clause you might see is the pay-when-paid clause. Though it may seem harmless, this clause can result in you fronting the entire bill for reasons that are entirely outside your control. Nobody wants to lose money working on a project, but signing off on this clause is an easy recipe for doing just that. Essentially, the pay-when-paid clause is a promise to front the bill for your work until the owner pays your general contractor (GC).
Though it’s not your fault that the owner isn’t paying the GC, you have forfeited your right to be paid in a timely fashion by agreeing to this clause. This can be a business-ending agreement if you aren’t careful, so be sure to look out for this clause and work to negotiate it out or agree on a fairer version.

Termination

You need to be extra careful when planning to terminate a contract. Always check to see what you’ve agreed to as far as termination is concerned. In some instances, you can wind up having to pay for the completion of the project after leaving the site. In other words, the termination clause in the contract may require that, if the new contractor completing the work costs more than you did, you are financially responsible for the remaining funds
it takes to compensate them for taking over your work.

Don’t Sign What You Don’t Know

Construction contracts are especially challenging. Many provisions make it difficult to understand what you’re agreeing to. Signing one dangerous clause can be the difference between shutting your business down and stepping your business up. Do yourself a favor, and plan ahead. Get educated about construction contracts or have a skilled construction attorney review and break down your contract before signing. Having a construction law professional in your corner is a surefire way to keep your contracts safe.

Karalynn Cromeens is the owner of The Cromeens Law Firm and The Subcontractor Institute in Houston. She has been a licensed construction attorney for over 16 years.

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